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SIMON BAIN SATURDAY INTERVIEW
The German-born businessman had turned his back on becoming a blue-chip chief executive after heading up seriously large companies in Canada and the UK, and had instead ploughed his life savings into starting a steel fabrication workshop in Forfar
Mr Twickler's PressureFab start-up in 2009 consumed his life savings, mortgage, car and even personal credit.
"I remember standing in Dundee, opening my wallet, and working out which of my credit cards I could use to take out £100," says the man who sunk £500,000 into building his dream, in impeccable English.
Three years on – and transplanted from Forfar to a site 10 times bigger on the Dundee waterfront – PressureFab is now Scotland's biggest supplier and only manufacturer of offshore containerised equipment, it has a portfolio of other high-spec oil and gas services, and it employs 90 skilled workers.
Its creator, recently named Scotland's emerging entrepreneur of the year by the Entrepreneurial Exchange, is blazing a trail for manufacturing in Scotland, and for the quicker payment of smaller businesses.
Now Mr Twickler hopes to get Scotland an early foothold in the burgeoning wind turbine industry by persuading a European manufacturer to set up a joint venture in Dundee which could create up to 500 jobs.
"Nobody in my family had ever been self-employed and I worked for relatively large companies all my life, but I always wanted my own business," says Mr Twickler, who grew up in north-west Germany and became a shipbuilding apprentice then a master craftsman – the qualification required in Germany to start your own business and train apprentices ("it's not like Britain, everything is regulated").
An internship at Boeing in Seattle led to senior roles in companies across North America and a reputation as a manufacturing turnaround specialist. "I was mainly brought into under-performing factories. I was solely responsible for them and I was increasing productivity by up to 250%. Steel fabrication is what I have done all my life – manufacturing and management."
Mr Twickler developed strong views on the corporate culture which encourages short-termism. He says: "I got frustrated with owners and shareholders who are just looking at dividends and expecting far too high returns.
"You also get frustrated with board members and CEOs who just shouldn't be there. But they are, you are reporting to them and doing all the work, and you get a warm handshake for it."
He quit his job as operations director of VT in Portsmouth in 2008 and founded PressureFab. His start-up budget of £150,000 was more than trebled until he nearly ran out of cash.
"I really thought suppliers would supply, banks would lend you money if you had orders for customers ... but because of the financial crisis a lot of people were very nervous."
He also believes necessity is the spur to survival. "You will find every entrepreneur has to reach the point where he is out of money – where he has to make the business pay."
Mr Twickler does not accept 2008/09 was a bad time to start a business. "If everything is going strong and everyone has got a job, where is the opportunity?"
But banks didn't see it that way. "This company didn't have any bank funding until we were already a multimillion-pound company. Credit reference agencies don't help because they are always based on historical data – businesses now doing really poorly will still have a good credit rating and businesses going strong who haven't published the results will not."
PressureFab landed in Dundee, the founder says, because of its manufacturing heritage and skills base, as well as the price of real estate.
"A lot of big companies were here and had facilities here. I know there have been issues, especially with trade unions here previously, but I have found there is a huge skill base and university support."
Banks, competitors, and some potential customers told Mr Twickler it couldn't be done – offshore containers came from China, they claimed.
"I said, 'well they shouldn't'. In Scotland there is no other manufacturer who can build containerised equipment from A to Z in-house, it doesn't exist. I also believe British manufacturing businesses are outsourcing far too much, it is an outsourcing culture to avoid investments. Businesses need to invest in their people, their facilities and their equipment in order to be competitive. This is a classic example of short-term vision."
PressureFab's core container product is competing successfully with lower-specification equipment that uses imported components assembled in the UK. Its breakthrough contract came when, within 18 months of start-up, it won an order for 18 platts (pipe connectors) for a BP project requiring submersion to a depth of 400 metres.
Mr Twickler says: "If you have gone through all the scrutiny these companies give their supply chain, that is a milestone for the company."
A more recent flagship project saw PressureFab build a huge £500,000 pipework unit for Honeywell, to instal in a gas-fired power plant in Spain. Turnover has raced to £6 million, with profitability from day one.
The firm is now strong enough to insist on 30-day payment terms with customers, and pass that benefit on to suppliers. "We had a contract at the end of 2009 and I had to wait 130 days for my money. As a consequence, I afterwards never gave anyone over 30 days payment terms again."
Mr Twickler says the UK payment culture originates in finance departments and is "crippling manufacturing", and suggests: "If the Government could take on the enforcing of any debt over 30 days, that would be the biggest help."
Settled in Dundee with his partner Jesse Youmans, the firm's commercial manager who followed him from Canada, Hermann Twickler's ambitious plans to grow the business in the renewables sector show he is shaping up to become one of Scotland's most valuable imports.
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