AS debate rages about the wisdom of the Government's decision to impose the Apprenticeship Levy on firms amid uncertain times, an engineering sector veteran highlights the benefits his firm has enjoyed as a result of investing in such training programmes.

Name:

Alan James.

Age:

63.

What is your business called?

AJ Engineering & Construction Services Ltd.

Where is it based?

Forres.

What services does it offer?

AJ Engineering is primarily a metal fabrication company and predominantly it is structural steel fabrication for buildings and structures. We have a sister company NEWCo which is based in Fort William.

We normally work to our customers’ unique designs. For example we are currently working on the development at Forres Railway Station and the station building has curved rafters. It makes the process slightly more complicated and challenging, but that’s what we like. This job is special to us as it’s for the town where the business was born and bred. However, we work all over the UK on projects of varying sizes.

We also offer mechanical engineering support to firms which involves maintaining and servicing their equipment and have a CNC machining department that provides machine components.

To whom does it sell?

Technically we can sell to anyone. We have worked on jobs ranging from making replica garden gates for a homeowner to fabricating and installing the structural steel and cladding for Stronelairg Wind Farm substation near Fort Augustus. That deal alone was worth upwards of £2.5 million. We do a lot of work for distillery companies including Diageo and one of our longest standing clients is in the wood industry, Norbord, which is a world leading manufacturer of engineered wood-based panel products.

A large part of our CNC business is servicing the Aberdeen subsea industry where quality and close tolerances are paramount

What is its turnover?

£12 million.

How many employees?

Between AJ Engineering and NEWCo we currently have 90 employees and of those 90, we have 12 apprentices.

I was an apprentice myself, as indeed were most of the AJE and NEWCo management team, and I am delighted that apprenticeships are now the in thing. Apprentices are the lifeblood of our company, but for AJ Engineering that is nothing new. Every year we take on new apprentices. Last year, due to an increasing workload we employed three and we expect that will be the same this year. The reassuring thing for us is the amount of good quality applicants we get.

Apprentices work well at AJ Engineering as in our line of work there is nothing like learning on the job and we work on such a varied amount of projects. We make it clear that the apprentices can progress and find people who join in their late teens or perhaps early twenties work their way up through the business. It’s because of this mix that I believe we have such a strong employee retention rate.

When was it formed?

1998.

Why did you take the plunge?

A lot of folk start in business as they have a desire to be their own boss and to ultimately own their own business. It was never like that for me. Forres-based William Reid Engineers was where I started as an apprentice in 1971 and worked my way up through the ranks to become the projects director. Unfortunately they went into receivership in 1998 and most of the 100 employees were made redundant. Some of us were kept on for a couple of months to see some the contracts through to completion and this gave me time to review my situation as I had to look to the future. It made sense to me to start something that I knew about and that was a metal fabrication company. Starting my own business at the age of 45 wasn’t planned but I had the full support of my wife, Ainsley.

What were you doing before you took the plunge?

I was very happy at William Reid and if it hadn’t folded I expect I would still be there today and would have helped develop it further. However what I didn’t fully recognise, at the time, was how much I had learned at William Reid about metal fabrication, customer relations and running a business.

How did you raise the start-up funding?

I had some small savings which were all ploughed into the business and an endowment policy which I had started when I was 18 and that matured the year I started up AJE. It wasn’t a lot but it was important

I also found a bank in Aberdeen that provided £50,000 under the government backed small business loan scheme. That was really important as it was the first time that I had a backer.

Moray Council helped me to buy a metal cutting guillotine.

Finally, my father loaned me a small sum of money to bridge a temporary funding gap and I was delighted that I was able to pay him back within the first year of business.

What was your biggest break?

Getting a contract with Norbord. The problem was that to do the job I needed £100,000. I explained to them that I couldn’t fund the project and they made an early deposit meaning we were able to progress the work. They were very helpful and 18 years on, we are still working with Norbord.

What do you most enjoy about running the business?

Having the freedom to make decisions. I love meeting and fulfilling customer requirements, employing apprentices and watching them develop, that gives me a real buzz. I also enjoy seeing the business develop for the mutual benefit of the employees and long term secure benefit of the company. Business is all about people and their development and that is very important to me as I have seen it first-hand.

What do you least enjoy?

Having to chase money.

What are your ambitions for the firm?

To keep continuously growing and developing the companies in a planned way which we have always done.

What single thing would most help?

A sensible reduction in regulation and paperwork.

What could the Westminster and/or Scottish governments do that would help?

Often the application process for official support is a long and winding road. However the small business loan scheme that provided me with the £50,000 to get started certainly worked and it did not take a lot of form filling. The result has meant that I now have 90 employees, a turnover of £12,000,000.00 and I’m paying rates and taxes. All the people I employ are paying taxes. That to me is a good investment for the government and they should continue to fully support and help develop small businesses.

What was the most valuable lesson that you learned?

Once you make a decision stick with it.

How do you relax?

I like to spend time with my wife and my family. There would be a difference in opinion of how much time I devote to this!