Global Ambitions entrepreneur network visit to BCF headquarters

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We visited BCF at their smart new HQ in Strathclyde Business Park, Bellshill. I knew my first question before I got through the door “How do you find premises like this?” 

The networking lunch quickly converged on the subject of business banking. It seemed we had all been on a similar journey, and it didn’t take long to reach a broad consensus, placing HSBC as favourite with Santander close behind. It was heartening to hear positive accounts of what some banks can and will do for small companies trying to grow and trade globally, rather than the usual accounts of frustration in dealing with the big local players. Attempting to open a dollar account seems to be a good test of whether your bank will help support your international expansion.

Alan Picken (BCF Chief Executive) then took us through BCF’s history, its value proposition, management philosophy and growth strategy.

BCF was founded in 1983, and is named after the initials of its three founders, who were pioneers in medical imaging.   When it became clear that they would not beat the likes of GE and Siemens in the medical market, they decided to develop ultrasonic imaging equipment for veterinary applications (confirming pregnancy and counting lambs).  Medical and veterinary systems use the same core technology, but the need for very high throughput, the demands of “in the field” use – literally – and the canny finances of farmers call for a subtly different product and service offering. 

 

I had expected that BCF to be an engineering company, designing and manufacturing hardware.  But it turns out that half their business is reselling equipment made by other vendors, for equine and small animal diagnostics (they will sell you a horse-sized MRI system, if your pockets are deep enough), with software as a key differentiator for both home-grown and resold products.  They invest heavily in training and support for all of the products they sell, regardless of manufacturer.  Their “hedgehog” is about making their customers productive, which ultimately owes as much to the customer’s skill and insight as it does to equipment, and so BCF see their core strengths being in customer and application expertise, rather than instrument design.  All of this is distilled down into the company goal of being world leaders in veterinary imaging. 

 

Alan had a technical role in the company until 2000, when he bought the company from its founders and became Chief Executive.  It was clear from his talk that his passion lay in developing the business as a whole, not just in the technology.

Since 2000, BCF’s strategy has been one of organic growth, by reinvesting earnings rather than raising capital through debt or equity.  They have a huge market share in the UK (95% share for their farm equipment?), and see overseas expansion as the key to future growth. Overseas sales are achieved through a combination of subsidiaries and distributors.  The ground rules are different for each country – setting up a business in the US didn’t provide a model that could readily be transplanted to either France or India.  And patience is needed – they expect to take4 years for a new overseas operation to start paying for itself.

For those of us in VC-backed companies, who may have repeatedly peddled the same hockey stick to the same investors, BCF’s strategy was food for thought. Our companies are born into a life of risk, and we accept that as a natural consequence of our high-growth plans. Focussed on growing the top line and reaching that magical land of positive net margin, we don’t think too much about what our strategy will be once we’re over the rainbow.  Do we want an exit to end the story or to start a new chapter?  Would security reduce our hunger for growth?  I guess we all look forward to finding out.

BCF’s approach has clearly paid off, allowing them to steadily expand, while retaining the freedom to run the company their way.  BCF spent a long time developing their core values of Partnership, Learning and Innovation.  These are written through the company like Blackpool rock, and alignment with these values is a key part of recruitment and staff development.  BCF’s philosophy is to give staff autonomy to enable them to grow personally, accepting that mistakes will be made on the way.  This came across in the factory tour, from the layout of the factory to the comments and insights from staff, who clearly have a strong sense of pride and ownership in what they do.

History and philosophy over, it was not time to see the factory, the folk and the kit.

BCF outgrew their previous premises in Livingston, forcing a move to a very tidy building in Bellshill two years ago.  After 30 years in Livingston, this was a huge upheaval.  A key part of the move was ensuring the staff all bought in to the need to move, and that the company did what it could to reduce the impact on them individually.  Their experience, which included a year spent looking for suitable premises in Livingston, underlined how challenging it is to find premises for a manufacturing-based technology company, particularly when a high-growth strategy starts to deliver steady expansion. 

The factory oozed 5S, as did the staff we talked to on our way round. Alan was very open in answering questions about operations, in particular about all aspects of their Enterprise Resource Planning (ERP) implementation, which is visible everywhere in the factory.  ERP success stories and advice are a great help when you’re trying to justify the eye-watering cost, and hoping to avoid repeating one of the many ERP disasters that are now legend.

BCFs products were the highlight of the trip.  Having grown up in a farming area in ‘70s, it was impressive to see diagnostic capability that had barely made it into hospitals back then now being used by trained-up shepherds, with a highly-accurate lamb count taking just a few seconds per ewe. 

The practicalities of handling and scanning cattle have driven the development of what is surely BCF’s coolest-looking product – a lightweight, ergonomic, man-portable bovine scanner with VR goggles!  If Arnie does another cowboy movie, you’ll surely see him wearing these. 

There were plenty of questions throughout the afternoon, particularly since everyone in the audience turned out to have an unhealthy level of interest in either medical imaging or equine diagnostics. Alan comfortably fielded the rather intense technical questioning in these areas, as well as the expected grilling on more business-oriented matters.  I think we poked and prodded every aspect of the company, and came away both impressed and wiser. 

All in all, BCF came across as a great example of a Scottish company with truly global ambitions – with the effective management and execution to make these ambitions reality. We’ve seen it can be done – the rest is up to us!

 

Roy McBride

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