Caerphilly-based civil aviation parts distributor and lessor, AerFin, which provides end of life solutions for the aviation industry, has enjoyed something of a meteoric rise since its inception in 2010. Last year it became the first company from the South Wales Valleys to top the Fast Growth 50 list and shortly after that it was named the sixth fastest growing business in the UK by the Sunday Times. And fortunately, this dazzling ascendancy shows no signs of abating any time soon.
Here AerFin’s Managing Director, Bob James talks about how the business is achieving its rapid growth and evolution and just how it plans to capitalise on its existing successes.
As a passionate businessman, I’ve always been very ambitious, with a real passion for entrepreneurship, so when I established AerFin in 2010 I had a clear-cut growth strategy in place.
Securing significant investment was always going to be a key part of this plan, so when we agreed a major equity share agreement with CarVal, a global investment manager in December 2014, this brought with it the kind of significant capital injection and extended market reach that made it possible to implement such an accelerated growth strategy.
But as most business folk will know, quick growth alone is not enough to demonstrate the robustness of a business, nor is it enough to guarantee a firm’s continued success – so what’s the real secret behind sustainable business growth?
Shared vision and expertise
Without a doubt, having a thorough knowledge and understanding of the sector in which you operate is one of the most crucial aspects of being able to cultivate and sustain business growth. And it’s not just about having knowledge about your competitors, markets and products, but it’s also about understanding industry trends, patterns, and developments. Being highly attuned to your sector is what creates true industry experts. It’s all about having a feel for what your end users want, knowing what partner companies are looking for, and showing investors that you are not only experts in your field, but forward-thinkers, innovators and trend-setters.
And this kind of thinking needs to permeate your entire workforce, which is why we have been rigorous in our recruitment strategy, making sure we hire aviation professionals of a truly high calibre who share our ethos and are able to deliver a consistently excellent standard of service to our customers.
Smart investments and strategic partnerships
Smart, strategic investments are a vital component of AerFin’s growth plans. Each of our investment decisions has been the result of carefully considered strategic and tactical assessments that take into account long-term pay-off potential, rather than a ‘quick-win’ approach.
For example, with the launch of Airbus’ A350 aircraft, it was inevitable that airlines worldwide would eventually start phasing out the older model, the A340-300. Knowing that the sum of the parts of these aircraft was now of more value than the whole aircraft itself, we bought eleven of these soon-to-be obsolete A340-300 in a multimillion-pound acquisition.
After disassembly the parts of each aircraft will be used to extend the life of various airline’s maturing fleets of A340-300 aircraft by reducing their operational costs, including engines, airframe and component maintenance.
The strategy resulted in an ongoing joint venture between ourselves and one of the world’s leading Maintenance and Repair Overhaul companies, Swiss company SR Technics. The collaborative venture, Beyond Fleet Services, is designed to reduce the costs incurred by airline operators, helping them maximize the life-span and revenue potential of their existing fleets, before their eventual withdrawal from service.
For the time being, our strategy is to focus on proven strategies, although we wouldn’t rule out deviating to other product lines in the future. The message here can translate to businesses across almost all sectors: keep an open mind about future opportunities but focus on what you know works. The things that your business does well should be your primary concern.
An international outlook
In order for a business to grow exponentially, having a global perspective is crucial. For AerFin, our expansion into Asia makes perfect business sense. Due to the nature of our industry, the company has a broad customer base on an international level and we’ve sought to enhance our offering to these global markets by launching an office and warehouse distribution centre in Singapore to support the Asia-Pacific region. With the pan-Asian economy growing at pace, it was an obvious move for our business, in order to operate effectively out of this region.
Positioning AerFin as a global company is a strategic move that has paid off; so much so that we’re now doing more than 60% of our business internationally, a figure bolstered by opening outposts in new territories like Singapore, as well as strategic alliances with global partners like Swiss based SR Technics as mentioned previously.
It’s vital that more firms focus on driving growth forwards, learning from one another and pushing for innovative solutions. With the right mind-set, strategy and a highly effective team in place, I firmly believe that strong growth and international standing are possible for myriads of companies in Wales.
AerFin has been named as one of the principal event hosts of the forthcoming Business Wales Growth Week: a week-long series of events from February 27th – March 2nd hosted at flagship growth companies across Wales. The events are designed to help foster a growth environment in the Welsh market, and equip SMEs with the skills to grow successfully, and sustainably.
Business Wales, which is funded by the European Regional Development Fund through the Welsh Government, supports the sustainable growth of small and medium size enterprises across the country by offering access to information, guidance and business support. Visit www.businesswales.gov.wales or www.busnescymru.llyw.cymru for further information.