Tapping Into New Ideas
21st March 2017 Paul Andrews
It’s often said that family firms have the ability to reinvent themselves with each new generation, but it’s harder to find real-life examples where this has actually happened. Greg Rowe Ltd is one of them.
After growing a hugely profitable tapmaking business in the ‘80s and ‘90s, the family started up a new venture focusing on drinking water filtration products, and is now expanding back into the kitchen taps that gave them their initial success. And it’s all down to the power of innovation…
Greg Rowe Senior built his first business from his garage, with his partner, Bob Perrin. It eventually grew into the Perrin & Rowe range of luxury kitchen and bathroom taps, showers and accessories. The company’s success was also driven by their invention of Triflow. The world’s first three-way tap, the product dispensed hot, cold and filtered water from a single spout and was patented in 1991.
As Greg’s wife Alex says, “At one point, there were Perrin & Rowe taps in every single 5-star hotel in London, as well as other luxury venues all across the world." Greg adds, “We grew at 30-40% a year for about five or six years.”
That international expansion was built on an exclusive distribution arrangement with Franke, the biggest sink manufacturer in the world, and over time, Perrin & Rowe expanding its sales in the USA. At the end of 20 years the business was turning over around £19m, and had three manufacturing sites. Greg Rowe Junior, Greg’s eldest son and his brothers, Scott and Todd were all working in the firm, alongside other family members. But with retirement looming for both of the founders, the decision was made to sell their shares.
However, as Greg Rowe Junior says, “Once an entrepreneur, always an entrepreneur. When the chance came up to acquire a small filtration business called FreshWater, Dad couldn’t resist. And it wasn’t just that – he also wanted to give me and Todd a chance to build a family business of our own, just as he had.”
Both sons were prepared to “roll our sleeves up and do what had to be done”, but that task turned out to be even bigger than they expected, as the timing coincided with the 2008 credit crunch. “We knew FreshWater had problems,” says Greg Junior, “it was already losing money and lost even more when the downturn hit. But we’d bought it because it had a good digital sales platform, and we focused on growing that. It was tough, and we had to pare back to the bare bones, but we hung on in there. We focused on improving quality and streamlining the product range. And then we had a stroke of luck.”
That luck was a call from the MD of Franke UK. They were still working with Perrin & Rowe, but had encountered some challenges, so they asked the Rowes’ new business if it was interested in making filter cartridges for a range of taps which Franke were planning to make themselves. “It was our breakthrough,” says Greg. “We started hiring engineers again – some of whom had worked with us at Perrin & Rowe – and set up a whole new call centre and after-sales function to deal with the Franke products."
"That turned out to be key, because it meant we were hearing directly from consumers about what worked with the Franke taps, and what didn’t. That was the spur to start working on a new tap of our own. Because when it comes to innovation, it isn’t just about engineering, it’s about practical issues like how the product is installed and used. Having that insight helps you identify what exactly consumers are buying from you. In our case, it’s not taps, per se, it’s water – water at the quality and temperature they want, in an instant. That helped us see that we’re not just competing with other tap manufacturers, we’re competing with kettles too.”
The result was Omni, a new multipatented four-way tap, dispensing filtered boiling and cold filtered water, as well as normal hot and cold flows. “It’s easy to install, and easy to maintain,” says Greg. “We’re making around 600 a month, and they retail at £1,400. We’ve plans in place to begin exporting to Europe, China and Australia, and we’re adding to the range all the time. And everything we’ve done so far, we’ve funded ourselves.”
The key to the family’s success is their dedication to innovation, just as it was the first time around: “Around 15% of our turnover went into R&D last year,” says Greg. “We empower our employees and apprentices to come up with new ideas, and we’re backing up our investment in our physical infrastructure with investment in digital – new websites, new systems, and better e-commerce platforms."
"We’ve never been followers and we never will be.We always want to be first.”
This article was featured in the 2016 PwC UK Family Business Survey and has been reproduced with their permission. Click here to see the report in full.