WHEN THE RELATIONSHIP MATTERS MOST

Offsite Solutions

When global supply shocks put pressure on cash flow for this bathroom pod manufacturer, Investec provided a confidential invoice discounting facility and has built a partnership based on trust and understanding.

CASE STUDY: Manufacturing, industrials, transport & capital goods

At a glance

20+

Years under current ownership

£400m+

Sales revenue since 2007

10,000+

Bathroom pods supplied every year

MEET THE CLIENT

A premium supplier of modular bathroom pods

Offsite Solutions is the UK’s leading manufacturer of bathroom pods. Its pods, which are manufactured offsite to reduce build times, improve quality and simplify site logistics, are used in large-scale construction projects and developments across several sectors, including student accommodation, build-to-rent, build-to-sell, hotels, and projects for the Ministry of Defence and the Ministry of Justice.

The current owners bought the business in 2004, at a time when it was in financial distress. Today it supplies more than 10,000 modular, fully completed bathroom pods annually to major developers and contractors.

Richard Tonkinson, Executive Director, Offsite Solutions

I think we're very much regarded as the premium manufacturer, the premium supplier in the British market, and that has been something we've developed over the course of the last 20 years.

THE CHALLENGE

When supply shocks meet long project cycles.

The company has faced several “once-in-a-lifetime” events in the past five years. The most immediate was Russia's invasion of Ukraine. The company sourced materials from that part of the world, meaning its supply base was disrupted overnight.
The length of its project cycle adds to the potential strain on capital. Offsite Solutions quotes today for projects that will be built in two years' time. When input costs rise sharply after a price has been agreed, the gap falls on the business's working capital.

Looking over shoulder of CAD designer working

Kon Harrod talking while walking through warehouse

Jon Harrod, Financial Director, Offsite Solutions

The Russian invasion of Ukraine was a year or so into my time at Offsite Solutions. That meant immediate upheaval in our supply base and immediate spikes in prices, which you sometimes cannot pass on immediately or at all. That puts immediate pressure on your cash flow.

THE SOLUTION

A facility backed by a service.

While the company already had invoice financing in place, it was looking for a fresh approach. Investec put in place a confidential invoice discounting facility that allows the business to receive funding against outstanding invoices, so it can pay suppliers and cover overheads as required.
But how Investec manages the relationship has been the biggest difference. For example, when the company had an issue with a payment from a particular customer, all it took was a phone call for different options to be outlined, and the company could then judge how much flexibility it needed and work through the problem in its own way.

Jon Harrod, Financial Director

We had an equivalent facility, but not an equivalent service, which is why we moved over to Investec. It was great to have those options on the table… to navigate the challenge we were going through. That's why I describe it as a partnership, not a supply agreement.

THE OUTCOME

Direct access and a lender that knows the business.

Offsite Solutions sees Investec's approach as more in-depth: taking time to know the business and the people running it. That understanding helps ensure financing decisions are aligned with the company’s risk appetite and its commercial objectives. For the team at Offsite Solutions, the future is bright. As development schemes become larger, and construction deadlines become tighter, their solution becomes more and more appropriate. It means the company has some great years ahead of it.

Jon Harrod chatting while walking through warehouse

Jon Harrod, Financial Director

I believe Investec’s approach is more hands-on… We’ve got each other’s mobile numbers, that means there's no login credentials and passwords and things and chat bots to get through to someone you can talk to. We’re able to pick up the phone and have a quick chat.