At the cutting edge

It's rare for one company to be active in so many different aspects of the industry - from distribution to manufacturing, data collection to butt fusion, and polyethylene pipe and fittings to ductile iron. And, with its international sales almost doubled compared with last year, Fusion Group is flourishing.

If you are looking for a barometer for the health of the international water industry, then Chesterfield-based Fusion Group is a good place to start.

Fusion was established in 1971 by chairman Eric Bridgstock. Working for DuPont, Bridgstock pioneered the introduction of polyethylene pipe into the UK, initially for gas applications. Having tried, without success, to convince established toolmakers of the potential market for tools to join the pipe, Bridgstock decided to do it himself - and Fusion was born.

"People today talk about the need for the utility sector to innovate, but the really exciting thing about those early days was that innovation wasn't an option - it was the only choice. I try to instil some of that sense of improvisation and experimentation in the design engineers we employ today."

Securing the future
Bridgstock believes continuous product improvement has a vital role to play in securing the long-term future of the company. "Fusion Provida was the first to introduce automatic butt fusion, and our latest range of Gator machines incorporates no-lift technology, which eliminates the need for a two-man lift of the trimmer or heater-plate."

With the emphasis in AMP5 likely to be on asset integrity, it is becoming ever more important for utilities and contractors alike to be confident in the quality of the new infrastructure they are putting in the ground.

Fusion has invested heavily in developing digital data capture and transmission systems for its butt fusion machines and electrofusion boxes. The company's equipment division is Fusamatic, the electrofusion fittings manufacturing facility. Bridgstock accepts that smaller electrofusion fittings in particular have become commoditised.

While clients still value quality and consistency, the market is increasingly price-driven.

To remain competitive, Fusion has developed state-of-the-art robotics and continuous manufacturing systems.

Bridgstock explains: "Over the past three to four years, we must have spent almost £5M to create one of the world's most efficient production facilities.

"It was a bold and potentially risky decision at the time. But I'm a manufacturer at heart and believe that with the right equipment and management. British companies can still compete in the international marketplace."

Although privately owned, Fusion is a multinational, owning many of its overseas distribution outlets. The company has also established two manufacturing facilities in China.

Group managing director Kevin Raine emphasises that the strategic impetus for this move was to secure a chunk of the rapidly expanding natural gas market, and Fusion Provida remains a net exporter to China.

The company has almost doubled its international sales compared with the same period last year.

"The most exciting development is that we are growing sales in virtually every continent," says Raine. "We have established solid distribution arrangements in the Middle East, Australia, Canada and Algeria; and our established distributors in Europe, the Far East and China are doing well."

In international markets, as in the UK, Raine believes you have to speculate to accumulate. "In May, we had the biggest stand in the UK pavilion at the Rebuilding Iraq exhibition in Amman, Jordan.

"We were one of a small and select group of UK companies chosen by the US organisers for speed meetings with Iraqi businessmen flown in for the day. Gas networks are limited in Iraq and the emphasis was on rebuilding the country's damaged water infrastructure. Since the event, I've signed quotes worth more than £100M for fittings, pipe and equipment."

In the UK, Fusion's national distribution centre in Chesterfield is supported by a network of 11 strategically located depots.

Transition
As always, the transition period between AMP periods is making trading conditions difficult for distributors. Raine says the company has counteracted the hiatus in water company orders by focusing on private markets, and in particular the multi-utility opportunities starting to appear on developer sites.

"I believe we're the only distributor to offer a truly comprehensive multi-utility package for contractors installing gas, water and electricity infrastructure.

"With one of our clients, Thames Water Developer Services, we take computer-aided-design layout drawings; create a detailed schedule of the gas, water and electricity products needed on a plot-by-plot basis; and then deliver them direct to site when the client calls them off."

Hire and service
The network of Fusion depots also acts as hire and service centres. Raine estimates that Fusion has well over 30% of the butt fusion and electrofusion hire market in the UK. "It's a virtuous circle really. We manufacture equipment that is built to last. We hire it out. And then we get direct feedback, which drives the next wave of product improvements and innovations. It's not rocket science, but it gives us a strong competitive edge."

Two years ago, Fusion joined forces with Indian ductile-iron pipe manufacturer Electrosteel to take on dominant market players. With framework contracts already under its belt with Yorkshire Water and Northumbrian Water, its joint-venture company Chesterfield Ductile Group has already established a significant market share.

Raine believes there is more to come: "This year, we're hoping to win further framework contracts with southern water utilities, and we've just appointed two new distributors, PDM and UGS, to attack the specification market."

Bridgstock says: "I believe site efficiency is going to be a key driver in the next few years as utilities and contractors seek to maintain profits by increasing productivity.

"We've recently established a new division called DataProvida to create systems which digitally collect and transmit data from site using the internet and hand-held PDAs.

"I'm not an IT expert but, from the business viewpoint, I can see the enormous benefits of receiving up-to-date information delivered direct to my laptop or mobile phone."

He adds: "We've nearly completed trials of a system which will allow clients to place orders direct from site using a PDA."

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