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Business / Thulecraft investment ticks all the boxes

LOCAL company Thulecraft is investing almost three quarters of million pounds over three years into expanding and upgrading its box plant at Lerwick’s Blackhill industrial estate.

Thulecraft director David Nicolson with the Bank of Scotland's relationship manager Michael Thomson.

Thulecraft produced around 1.8 million polystyrene boxes for the islands’ aquaculture industry last year, but the demand from the sector is such that the company has to find ways to become more productive and efficient.

Director David Nicolson said more storage room for boxes, a second boiler to produce the steam needed in the production process as well as an additional moulding machine will all help to overcome bottlenecks experienced in serving the three main players in the salmon farming industry as well two large mussel farm businesses.

“It really depends on what the salmon farming industry does,” Nicolson said.

“If they need to speed up harvesting then that puts pressure on us, and the two extensions will allow us to store more manufactured boxes, as well as house the second boiler, so that we can respond more flexibly to demand,” he said.

Nicolson said that apart from a few boxes that are exported to Orkney, all of its production is being used by Shetland based aquaculture businesses. Production can be as high as 14,000 boxes a day.

“It is not about increasing the production, it’s to make the factory more flexible. At the moment, we have to slow down production at times because we have nowhere to put the boxes,” Nicolson said.

“The investment will allow us to have all our seven machines going at all times when the factory is open, and that will help us reduce our cost.”

Local construction firm Hunter & Morrisons are currently working on the two extensions to the existing plant.

The £700,000 investment has been made possible thanks to a £300,000 funding package from the Bank of Scotland, as well as grants of £153,960 from Highlands and Islands Enterprise and £25,000 from Shetland Islands Council’s economic development unit.

The bank’s relationship manager Michael Thomson said: “Developing relationships with local businesses across Scotland, especially in remote areas such as Shetland, is extremely important to us.

“It’s great to help businesses like Thulecraft reach its full growth potential in what is a very important and increasingly competitive sector.”

A spokeswoman for HIE added: “As the business is experiencing high demand from the local aquaculture industry, the new extension will provide a better opportunity to store the products increasing the efficiency and productivity of the facility.”

Thulecraft is owned by charitable trust The Sandison Trust and employs 14 people. The company pays an annual donation to the trust, and its remaining profits are invested into its business.

It started out making polystyrene boxes for the emerging aquaculture industry from a small factory on Browns Road in 1986 before moving into much larger premises at Gremista in the 1990s.

“Ongoing growth in the local aquaculture industry has meant we’ve had to keep investing in our business to ensure we meet demand and guarantee the quality our customers expect,” Nicolson said.