Chris Holland meets the owner of an international wool firm which is thriving in private hands

PART of the Bradford-based wool trading and processing business Standard Wool dates back more than 200 years.

But it is the past decade which gives owner Paul Hughes the most satisfaction.

Ten years ago he gained control of the business he joined as finance director in 1987 through a management buyout from the Standard Commercial Corporation, a US-based tobacco merchant which diversified into wool.

An accountant, Paul has worked in textiles throughout his career, starting with the Calico Printers' Association.

Standard Wool (UK), based on Trevor Foster Way, Odsal, is a multi-million pound group and one of the world’s leading wool trading businesses with customers in more than 30 countries.

Specialising in sourcing, supplying and processing wools from the UK and overseas, the company employs around 150 people in West Yorkshire, Chile, New Zealand, and China.

Standard comprises four companies, including Dewsbury-based Thomas Chadwick & Sons, which is one of only two wool scouring plants left in Britain (the other is Haworth Scouring in Bradford).

Jacomb Hoare & Co is the trading division of Standard Wool’s South American operation based in Chile's Punta Arenas region. It dates back more than 200 years when it began importing South American wool into Bradford and is one of the world's oldest wool firms. Today, Hoare handles the trading and processing operations of Standard Wool (Chile) S.A.

Standard Wool's New Zealand business is a wool buying, scouring and international shipping company and the Chinese operation, Standard Wool (Nanjing, China), is a sales operation serving Chinese clients and specialising in Australian wool.

Standard Wool's turnover has risen from £38 million in 2005 to more than £50 million.

The buyout was completed with funding from RBS. Professional advisors included Ian Marwood at Grant Thornton who is now an independent director of the business.

"I am grateful to SCC for the opportunity to return this business to a Bradford-based private limited company again and I am very proud of our continued success since we completed the deal," said Paul Hughes.

But it has been far from plain sailing.

Six months after the acquisition a fire destroyed the scouring, carding and combing mill in Punta Arenas. The warehouse full of greasy wool was saved, which enabled Standard Wool to continue trading with support from its Uruguayan competitors who provided combing facilities during the rebuilding .

After a tussle with the insurers, Paul acquired second hand combing machines in France and the Chilean plant was officially reopened in 2007 by the Princess Royal who was touring the country. She had previously opened Thomas Chadwick's Dewsbury scouring plant in 1991.

Paul said: "Having completed that transaction it was devastating six months later to have the Chilian facilities destroyed. Reinstating the plant 18 months later showed the resilience of the business and the team effort that went into it.

"It was important for us to reinstate the operation. Some people may have taken the insurance money and ended production. It was a lonely decision for me as owner of the business but it was the right decision as it's important to our future."

Then came the banking crisis which led Standard Wool to switch from RBS when it became clear that no new money would be available. The business was re-financed through KBC Business Capital, an asset-based lender, now part of US-based PNC, which provided a three-year £13 million working capital facility.

Paul said: "We need an asset based lender who understands that we are funding working capital and not debt and appreciates the commodities sector. They have been excellent bankers who we regard as partners with whom we can be transparent and discuss things openly."

There has also been investment in Thomas Chadwick which employed eight people scouring two million kilos of wool annually at the time of the MBO. This has risen to 55 employees working three eight hour shifts a day processing more than 20 million kilos.

In Chile, the plant employs around 70 people and processes 60 per cent of Chilean wool clip and handles a total of 3.5 million kilos.

Standard Wool's head office, which opened in 2011 after a move from Clifton St, off Manningham Lane, has 18 staff.

The company's clients are in carpet weaving, including leading names Brintons - whose carpet adorns Standard Wool's boardroom - and Ulster Carpets, as well as the expanding Chinese Axminster industry, along with the apparel and knitwear sectors.

Paul is delighted that his son Paul junior, 31, joined the business six years ago after qualifying as an accountant and working in private practice.

"It was his decision and he has had no privileges. He has learned the business from scratch and is now wool trading director. That appointment was part of formalising a board structure and succession plan and I am very proud that he wanted to join the business.

"Some of my best assets are not on the balance sheet - they are the people who work or have worked in this business.," he said.

Paul junior added: "I always saw accountancy as a means to an end. Understanding a business better and knowing the figures means you can't have the wool pulled over your eyes. The skill is managing the risk and maintaining a position. The appeal was that I could put those things into practice."

Paul senior puts Standard Wool's continued success down to its experienced team of wool traders who are passing on their skills to the next generation, including the firm's first female trader Rebecca Spinks-Carter,who joined form Huddersfield University where she studied fashion and marketing.

He co-trainee is Pete Handley from a farming family who is a fully qualified sheep shearer.

They are learning from senior wool buyer Andrew Jones, who started in Standard's sample room in 1987 on a YTS scheme.

Paul junior is concerned about a skills shortage, having had little response when contacting local colleges.

He said: "There are good opportunities in this industry and we're keen to hear from youngsters with proficiency in maths, good communication skills and a passion for people and trading.

"Contrary to perceptions this is not a boring trade. During my training I have worked in

Port Elizabeth in South Africa, Melbourne and Freemantle, Australia, in New Zealand and Chile learning about different fibres and staple. It's a a worldwide business with good opportunities."

The Hughes are committed to continued development of the business, including a potential seven figure investment in replacing the processing line in Chile with the latest technology over the next 18 months.It will be the first South American company for many years to buy new machinery.

Paul senior believes that honest and reliable trading practices are key to Standard Wool's progress.

He said: "Our reputation is very important - even more than the bottom line. A contract is a contract. We fully believe that and we deliver what we contract to deliver."

While he now works three days a week and plans to eventually step up to become chairman and be succeeded as managing director by his son, Paul, 67, has no immediate intention of letting go of the reins.

"When I did the MBO, a lot of people felt that at 57, I wouldn't be successful. I'm very proud to say that today my company and balance sheet is as strong as it was in the SCC days.

"The opportunity to own a business came to me late in life and I never did it to sell out as a trade sale. I wanted to keep our independence and continue doing what we do well through serving clients. It's been a very interesting journey and, apart from the setbacks, one that has given me a great deal of satisfaction and pleasure," he said.