Wolf Heating UK is a year old but already Steve Lauri, managing director, is making waves. Paul Braitwaite reports.
STEVE Lauri, managing director of Wolf Heating UK, is the new kid on the block.
The company has been going for about a year but he is already signalling the German parent company is in this market for the long haul.
He sees the installer as key to the business. That is why he is dealing with colleges and training centres where installers have to go to keep up their certification. Steve’s idea is to help installers to market themselves as the expert.
“Many small firms don’t have the marketing know-how. They are installers, not marketeers,” says Steve.
“The one- or two-man band installers are competing with maybe five other installers for the business. I would like them to look outside the box and offer different equipment, not just a combination boiler and several radiators.”
Steve thinks installers are nervous of condensing boilers and this is one of the reasons the market is in decline at the moment. “There are enormous opportunities but only if you can get installers to think differently.”
It is, he says, about holding the installer’s hand and giving him the confidence to try new ideas.
Steve maintains everyone is in business to make a profit. Without profits, manufacturers cannot invest in the next generation of products, the merchant cannot open new outlets and the installer cannot grow his business either.
Wolf’s German parent invests huge amounts of money in research for tomorrow’s business and “I believe the heating industry needs to invest in its future”, hence the work with colleges and installers.
“Installers need to invest in the future. It is no use thinking from job to job. They have to try and work out where they want to be in five years time.”
He adds: “Unless we have pro-active innovative manufacturers to look for new market opportunities, to train and convince installers – be they one-man bands or large contractors – the market will stagnate or even decline. We, as manufacturers, can go only a certain distance before we need the help of forward-thinking installers and other partners including government and trade journals.”
Steve is obviously passionate on the subject. He was quick to tell me his company’s parent, Wolf GMBH, was Europe’s market leader for air handling products – “and very much an innovator in that sector”.
The parent company was founded 43 years ago to produce hop dryers which, if you consider its manufacturing plant is in Mainburg in Bavaria (where much of the German beer comes from), shows that it can spot an opportunity.
From hop dryers it was a short step to ahus and other air movement products. As the business grew, Wolf saw its opportunity to move into commercial heating products which in turn lead to condensing boilers for commercial and domestic markets. Latterly, it has moved into renewables such as solar and biomass.
Considerable opportunities
Wolf is a global player with businesses in China, Russia and Dubai and now here in the UK. Wolf Heating UK is a daughter company, formed in October 2005. There are sister companies in France, Spain, Poland and Luxemburg.
“The UK is the biggest market opportunity for condensing wall-hung boilers,” says Steve.
The immediate object of opening an office in the UK was to launch the high efficiency gas boilers which the company produces. And, says Steve, it was easier to support the product sales of its renewables, commercial and air handing products.
Wolf Heating UK is based in Northwich, Cheshire. Currently there are eight employeesbut “with the considerable opportunities which the UK presents, I would like to see about 35 staff working for the UK company in five years time”.
Steve believes his company will have a 7% to 8% share of the market in five years time.
He says Wolf has many different products in domestic, commercial and air movement. Currently it is about creating demand and “it is important Wolf has a close working relationship with key decision makers in local authorities, developers, merchants and heating contractors. Wolf has also been working with government bodies and key organisations such as DEFRA, The National Energy Foundation, NEA, The Solar Trade Association and the Energy Savings Trust.
“This gives us added credibility (and approved product) especially when we are talking to local authorities which are able to secure funding for our products,” says Steve.
“To gain approval for our products from the Energy Saving Trust has taken a few months of work.”
The company’s selection of wall-hung gas fired boilers are SEDBUK A-rated and have an output range from 3.2kW to 100kW.
There are two new boilers based on combination boilers with stratification cylinders ensuring a fast water supply with minimum storage.
“Basically, this is the perfect solution for larger domestic properties where hot water requirement is critical but space is also a factor.”
There are also commercial oil-fired and gas-fired boilers from 17kW to 5.9MW, which, says Steve, puts Wolf UK in a strong position in the marketplace with boilers which can be used in small commercial premises up to a large hospital/hotel complex.
“In the commercial sector, we have a wide range of air movement products which include warm air units, fan coil convectors, heat recovery units, exhaust extraction units and air handling units. There is a wide range of controls to match the systems.”
These can be integrated with hot water storage cylinders or solar systems as Wolf also manufactures solar panels. More recently the company has moved into renewables.
“This is the way we sell ourselves into the market with specifiers. Dealing with a high quality German company gives consultants and contractors confidence. Further the products are individually tested and guaranteed.”
For instance, Steve maintains, every wall-hung boiler which leaves the factory is individually tested, commissioned, calibrated and certificated.
“It’s almost plug and play.”
And he adds that the product has so few moving components which again reduces the risk of failure. If there are still problems then a dedicated service team will swing into action.
Steve is very proud of the German manufacturing heritage and he insists customers believe the products are high quality with many prepared to pay a premium.
And there are no logistics issues. Wolf works with a number of logistics companies and there is a dedicated partner to distribute the products in the UK. Stock of fast-moving goods is held here. However, the air products are often built to specific requirements. Even then, the customised units are usually available within 10 to 15 working days.
Hard task ahead
Steve has no illusions. He has a huge task ahead of him. He is breaking into a strong established marketplace.
On the plus side, while the products are high quality they are, nevertheless, affordable.
He admits he will have to work hard to take some share but insists: “We can offer the client such a wide product range and many partners are looking for more than just a range of, for instance, condensing boilers”.
Further, Steve believes that while price is an issue, it is not always the most important factor.
The company is prepared to try all routes to market. Steve agrees the merchant is crucial to the business as he is very much the stockist for the heating and plumbing contractor. Just as crucial are direct partnerships with consultants although often the product still goes through the merchant. For the bigger air handling systems, the route is direct. It is about horses for courses.
Its products have already been listed in United Merchants. “We have our products in United Merchants outlets and are beginning to enjoy some success.”
Steve adds: “Changing people’s buying attitudes is the hardest thing to do.”
Which begs the question: How do you change those attitudes?
“ Many installers are happy with their supplier and the products and in many cases the manufacturer has trained the installer, and incentivised him too.
To change this, Wolf UK has three dedicated training centres, one in the south west, another in Yorkshire and a third in Cheshire.
Each centre holds a wide range of Wolf products. All are BEPEC approved for solar too.
Steve insists his company has done more in the short time it has been operating in the UK than some competitors have done in all the years they have been here. Wolf has also addressed a number of seminars.
“It is important to remember not just the installer but people like building control officers or architects as they will create more awareness of our products as they write them into specifications.”
Steve has had some quality wins for Wolf with air conditioning products installed in the Home Office; air handling products have been installed in Debenhams stores; commercial boilers are heating Bentley Motors; condensing boilers heat the Scottish Parliament building and in Europe Wolf’s air conditioning is installed in Bayern Munich’s football stadium. One of its most prestigious projects is the Kremlin Palace.
“One of the problems of being the new boy is that clients ask you if you are here for the long haul or is it a case of doing a deal and going away?”
Steve laughs that when you deal with the Kremlin, the Scottish Parliament or the Chinese military, there is nowhere to hide.
China? But don’t the Chinese make most of the air conditioning units even if they are badged with different logo!
Here again, Steve insists it is the quality of the German kit that the Chinese wanted.
“Quality stands out, it is critical.”
Further, Steve suspects one or two of the major players will drop their standards, because they believe the end-user will lead the market.
“They are wrong. One of the biggest factors in the domestic market is the installer. He is very influential, the key decision maker – and he can make or break a sale of high efficiency heating and ventilating systems” Steve insists.
“I am quite confident that if we can help the installer market himself and his business, that will be a huge benefit for the industry and the environment. And this is the area on which all manufacturers and organisations such as CORGI and others should be concentrating.”