by Real Business - Thursday, 30th August 2007

If you ever meet Gary Dutton, kick him in the balls. A swift pile driver to his knackers should instantly confirm what has long been suspected, but never confirmed: that Dutton’s cahunas are solid brass.

Take his attitude to staff relations. When unions threatened to recruit the workforce at his PVC window and conservatory frames firm Synseal four years back, Dutton faced them down.

“I was in a minority of one. My directors asked me to appease the unions, and I flatly refused. I went on Channel 4 news and told Kirsty Lang that I’d rather shut the business than let the unions in. We are a fair employer, but I won’t have them. I told the ISTC union that if you want me to stand in a cherry-picker in the car park and tell the world I’m going to make 700 people redundant, push me, and I will do it.” The unions fled.

Needless to say, Dutton is not your typical company chairman. He doesn’t wear a pin-striped suit, “and I don’t like golf”. What you’ve got instead is a no O-levels, been bust twice former sole trader from Mansfield who’s on the brink of becoming the UK’s biggest player in the PVC windows industry.

When he founded Synseal in 1980 he was the only employee. Today Synseal has 700 employees and a 19 per cent market share in conservatories, second only to Ultraframe’s 24 per cent. Dutton reckons he’ll overtake Ultraframe in the next year – and it’s hard to doubt this. Synseal’s turnover for the past five years has gone from £29m to £85m. Profits have leapt from £2m to £16m over the same period. And Dutton, you’ll note, still owns 100 per cent.

Talking to him is a revelation. In his broad Notts accent he answers every question with a directness and honesty that has been expunged from most modern boardrooms. He isn’t even shy about his wealth. “The Sunday Times got me wrong. They rated me at £87m. Well, I got an offer for the firm a year ago for £85m, and I’ve got assets of about £15m to £20m, so I’m worth north of £100m.”

Dutton runs Synseal his own way. With no formal business training he’s developed his own homespun business philosophy. Some of this thinking is ingenious, such as his Seven Man Rule: “I believe that each man should have no more than seven people reporting to him. I’ve got my seven directors, and they’ve got seven people below them, and so on. It’s an efficient way to run a tiered infrastructure.” Some of his other notions are rather more eccentric: “The only bad ship is a partnership. They do not work. They are counter-productive and self-destructive. When good executives get a slice of the equity they get proprietorial syndrome – which means they stop doing the bloody job.”

With his maverick methods and old-fashioned priorities, you sense Dutton could have succeeded in any industry. He confesses he picked PVC frames at random. “In 1980 I’d just gone bust selling baths and showers. I was looking for direct sales product to build a company around. I had no concern for PVC, but no prejudice either. I rented a small shop in Sutton-in-Ashfield and bought ready-made frames. I’d handed out a few leaflets, and had the courage to book a double-page colour ad in the local press. On my first day I took 32 leads and booked £10,000 in business in 48 hours.”

He quickly learned what a savage industry he had chosen, however. “Direct sales products need mystique. You need mystique to charge the sort of prices you need to recoup marketing costs. But the usual life expectancy for a product is nine to 18 months. Once the mystique has gone, and you can get the product at Curry’s and the Co-op for £99.99, you can’t charge £300 quid.” Dutton responded by diversifying. By 1989 he’d established a chain of retail outlets selling PVC window frames and doors, but shut them down, firing 200 people, to concentrate on wholesaling. When margins eroded in wholesaling, he moved on to manufacture.

Synseal started with fabrication: clipping together the plastic parts. In 1992, he took another step up the chain when he invested £1.5m on an extrusion manufacturing plant. This converts plastic gloop into the window frame parts. “Extrusion is a capital-intensive business,” he says, “but I believe you can do anything if you’ve got the right people. People laugh at my quotes, but the three most important things in business are, in reverse order: funding, timing and people.” Dutton knows what he’s looking for: hunger and experience. “Give me someone who’s been through the mill against a Harvard Business School graduate any day. We’ll leave them for dead.”

Extrusion turned out to be very lucrative. So much so, by 1994 he fancied cashing in through an IPO. “I wanted a nest egg. But I had misgivings. I felt the people involved in the process were severely lacking in commercial expertise. A lot of brokers and advisors couldn’t run a bath. So I pulled it.” Instead he flogged the fabrication arm. “I realised I was in competition with my extrusion customers, so I sold up.”

Having gone bust twice in the 1970s, Dutton was able to exorcise the ghosts of the past, walking off with a cheque for £3.25m. How did it feel? “Absolutely brilliant! Only an utter imbecile could go backwards from that.”

Dutton did not go backwards. He invested £2.5m in a plant to make the plastic compound used in the extrusion process. “Our capital investment was out of cash flow. Always was, and still is. Clearing banks are there for debtor funding only.”

He also entered another line of business – conservatory roofs. “Ultraframe had two-thirds of the market. I got a design team to come up with a product of our own. We made sure we weren’t infringing their patents, and undercut them by 30 to 40 per cent.” Ultraframe’s market share slumped, and Synseal will shortly become the number one conservatory roof manufacturer. Turnover for the group will also pass £100m by the end of next year, making Synseal the biggest name in the business.

Synseal has since entered other areas of production such as injection moulding to ensure it can milk as much revenue as possible from each customer. “Our average order value per customer in the mid-nineties was £1800. Now it’s more like £4,000.”

“Some people react to success by thinking they’ve got the midas touch, and fall foul. Fortunately I look in the mirror and say to myself, no, you are the same guy you always were.”

To keep on the straight and narrow, Dutton has a few simple laws. “No pomp and circumstance. My MD wears jeans and people still call me Gary. We don’t tolerate fools easily, and we don’t tolerate time wasting. We analyse and assess more quickly than our competitors because there’s no bureaucracy.” Dutton’s MD is Malcolm Le Masurier, who he hired in 1981. He’s a guy Dutton knows “will tell me I’m talking ‘bollocks’ if needs be.”

Dutton’s son, Nick, is head of sales and marketing. Is he the heir apparent? “There’s no favouritism here. I have no dynasty aspirations. He knows that.”

The only issue he won’t debate is exporting. “I don’t like it, don’t do it, and don’t want to know about it.” The UK has more than enough potential for him – though he says if Synseal get a two-thirds market share, he might reconsider.

His attitude to keeping directors happy is also simple. Pay them well – Synseal’s directors get over £160k – but also: “if anyone thinks they are indispensable, my view is make them dispensable immediately”. This way, loyal directors get rewarded. Prima donnas get shown the door. And Dutton stays captain of the ship.

At the ripe old age of 54 Dutton is starting to take a back seat role. He comes in when he likes, takes around three months of the year off, and “unless there’s a crisis, I’m ostensibly redundant”. When life is peaceful, Dutton’s to be found cruising round Nottinghamshire in one of his six cars. “I’ve got a Bentley Arnage T, a 360 Ferrari Spyder, a Range Rover Vogue, two Mercs and a Discovery. I love ‘em.” He’s also got a 25 metre gin palace moored in the South of France.

But you sense Dutton’s never happier than when he’s dreaming up ways to shaft his opposition and giving his directors hell. “I’m a crisis man,” he says with a maniacal glint in his eye. “I can sort shit out better than anyone else. You can’t relax in this business. We are there to be shot at. But we are still an aggressive organisation.” So if you fancy a pop – go ahead. Make his day. Just make sure your balls are up to it.

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