Orkney Jewelllers Increasing Sales Despite Global Downturn

13th October 2008

Scotland's biggest manufacturer of gold and silver jewellery is marking the run up to Christmas by launching eight new collections and opening two new stores.

Ortak has recorded sales of just under £5 million since January, a 9.7% increase compared to the same period last year.

Staff at the company's manufacturing base in Orkney are working overtime to keep up with demand.

Like businesses across the country, Ortak is having to cope with the challenges posed by the turmoil in the global economy.

But after another strong performance this year profits are predicted to better the 2007 pre-tax figure of £224,000. Ortak and its 150-strong workforce are perhaps better placed than most to weather the storm.

"There's no doubt this is the toughest financial environment we're ever experienced," said managing director Alistair Gray, whose father Malcolm set up the business more than 40 years ago.

"There's a distinct lack of confidence right across the economy. But at times like this you have to hold your nerve. We've been ambitious in the way we've grown the business during the year. We've just opened a new store in Glasgow, with another about to open in Livingston."

Ortak's new outlets take its retail portfolio to 14. Twelve can be found across Scotland, with two more in more in Newcastle and Sheffield. In all 90 staff are employed in the retail side of the business.

"Opening new stores at a time like this might seem a brave move," he said. "But for us it's all about growing brand awareness, with both in prime locations in central Scotland."

Often given as a gift, jewellery continues to be bought for special occasions. The company has noticed that customers are still enjoying the odd personal indulgence as well.

"We're delighted to have seen such a big increase in overall sales: it's something we've all worked exceptionally hard for," said Mr Gray.

"For everyone involved it's been a busy year and, despite the problems in the economy, it continues to be busy with the manufacturing operation on overtime for weeks now."

So what is the secret of Ortak's success?

For three decades this was primarily a production-led business, with plenty of demand for high-quality, high-volume jewellery of mainly traditional design.

But in response to the enormous impact of cheap imports from the Far East on the UK jewellery sector, the company embarked on a radical change of direction.

Unable to compete on price, Ortak needed a new way to keep manufacturing prosperous in 21st century Britain. The keys to success now are design and marketing.

The company uses the latest computer-aided design systems, enabling it to respond quickly to new fashion trends. As a result, Ortak can offer an ever-changing selection of contemporary jewellery in addition to its more traditional Celtic and Scottish collections.

"There's been a huge investment in design and product development," Mr Gray explained. "Five years ago we'd launch two main collections a year. Today that's gone up to 20, with eight new collections in our stores in the run up to Christmas."

The jewellery is manufactured in Orkney, where the traditional skills of the silversmith, handed down since Malcolm Gray started Ortak in 1967, remain as important as ever in the company's state-of-the-art workshop.

"We're unique among large jewellery manufacturers," Alistair Gray said. "With a strong presence on the High Street we know what our customers are looking for. That feeds into the design process. And by having our own manufacturing capability we can react fast to market trends, creating the jewellery we need when we want it - and with the quality our customers expect."

The latest collections are at the heart of a vigorous pre-Christmas marketing campaign fronted by Amanda Lamb, presenter of the TV property show A Place in the Sun and the new face of Ortak.

In the mid 1990s, Highlands and Islands Enterprise played an instrumental role in the creation of the modern production facilities needed by a company with ambitions to become one of the UK's leading jewellery designers and manufacturers.

"Assistance from HIE has been crucial in enabling us to fulfil those ambitions," Mr Gray added. "We wouldn't be operating on the scale we do today without their support."

Ken Grant, HIE's area manager for Orkney, said: "Ortak is a major manufacturing company producing jewellery that perfectly reflects Orkney's reputation for quality.

"HIE is keen to encourage innovation, support the development of new products and help the company become even more competitive in attacking new markets."