IN the dying days of the Scottish textile industry 22 years ago, Jim McFarlane created what is now the UK's top cycle clothing brand, and he continues to defy those who say he cannot make manufacturing pay in Scotland.

Endura has a unique visibility in the Tour de France, an industry-leading approach to ethical sourcing and community investment, and a remarkable export growth record, which brought it a national business award this year.

The founder left the Livingston-based business for five years while he founded two successful internet retailers, returned to find it stagnant, and in 2008 embarked on an ambitious overseas strategy of serious investment in direct selling and marketing. Turnover has rocketed from £3 million to £27m. Some 15 per cent of product is made in Livingston, enough to support 120 of the firm's 200 staff.

The founder says: "People say we should shut that down, but it is nice to employ people and make stuff in Scotland, if it was insane we wouldn't do it. We make a profit on it because it is technical wear and can justify the labour here."

The young Strathclyde engineering graduate was set for a high-flying career in management consulting and had been posted for a year to Sydney when his crossroads came.

"I was working 100-hour weeks and it was very corporate and Oxbridge, working for FTSE 100 companies…you are on a prescribed path to do your MBA so you can get billed out at a higher rate. I decided I would start to do something else, quit my job and went travelling."

But for the keen cyclist, the theft of his kit one day in Sydney had sparked a business idea. He soon discovered no global firm was making clothing suitable for the rapidly emerging new breed of mountain bikers, and set out to do it himself, in West Lothian.

"The Scottish textile industry was in free-fall collapse; big plants like Babygro, Levi, DAKS were closing. We approached two or three of them to see if we could set something up prior to them shutting."

But the commodity suppliers to the likes of M&S could not cope with high-stretch sportswear.

"I had no background but I was learning as I went along, it isn't rocket science …we couldn't get their attention and they didn't have the technical expertise. So we took a lease at Houston Industrial Estate and started making stuff ourselves."

The team had to learn fast.

"We took an order from a big cycle group for thousands of printed cycle jerseys and we had never printed one in our lives …we made a decent job of the kit, it was hundreds of thousands of pounds, and we made a loss on every one."

Helped by government support for screen print technology, the business was soon profitable but frustrated. "We got cheesed off with perpetual penny-pinching on specification from customers," Mr McFarlane recalls.

"If they had just spent an extra 30p it would be that much better… for instance, we thought we could get five times the product life if we used a better quality thread. We decided to do it ourselves, and in 1994 set up our own Endura brand."

The firm caught the wave of a reborn sport. "Cycling has very strong fundamentals, which since then have been brought into focus far more with health, welfare, personal fitness, gridlock, investment in cycle infrastructure … the government was already starting to plan for promoting cycling and it became something seen as socially responsible rather than weirdy-beardy. Now it is not only accepted but relatively cool, there is urban chic about cycling."

Endura exploited a market gap. "Cycle clothing had not been developed with crashes in mind, but mountain biking people are falling off on a daily basis."

By 1999 the business was coasting, and as dotcom boomed the founder got involved in setting up Pet Planet and Greenfingers.com, both ventures still flying. After five years he returned, to find it stuck.

"The business had lost five years, no question, but at the same time having a fresh pair of eyes on it was a powerful thing. Since then it has been about bringing in good management, investing in product innovation and tying it up with effective sales and marketing."

Mr McFarlane led the charge into direct sales, enlisting 2,500 bike stores in the UK and Europe and 500 in the US, along with indirect links to another 700 in the US and networks in Australia, New Zealand, Chile and Ecuador. "It was a really exciting project but it takes time," the founder says. "You invest heavily upfront paying people salaries and expenses, rather than using agents. Longer term you have far more control, it is far more patient from the customer perspective, and you set up local events to sponsor and build the brand with global level sponsorship."

A £1m-plus marketing budget has enabled the Scottish minnow to invest in constant new product and to pull off the first ever Tour de France team sponsorship involving a clothing brand (and it finished 7th).

"You need global volumes to justify fixed costs," Mr McFarlane says. "Most of our sales are now outside the UK."

The US market has been set back by the Lance Armstrong scandal ("the American hero drives their market-place") while in Spain growth is all in mountain-biking and in UK all on the road. But growth has enabled reinvestment in Livingston, where Endura opened a new plant last year. "We are trying to develop what we do here," the boss says.

What he will not do is use overseas plants with unethical practices, notably child labour. Endura enforces strict vetting by management of all its suppliers, and avoids some countries (Bangladesh, Pakistan) entirely.

The company's good citizenship now extends to a £600,000 investment in the Endura Lifecycle Barn, offering disadvantaged kids a bike experience aimed at giving them a hands-on feel for technology.

The company recently took on a minority investor to help with working capital, but Mr McFarlane says its finances are in good shape. A key ingredient has been executive director Pamela Barclay, whose career has spanned Trespass, Blacks, Austin Reed and John Lewis, and who is partner to Mr McFarlane and mother to their four-year-old twins.