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Flownetix Ltd

Sector:           Manufacturing
Employees:      6
Location:         Marlow, Bucks

The big idea :-  outsourcing flexible manufacturing capability to concentrate on core expertise.

What they do

Established in 2003, Flownetix manufactures radically new electronic water metering devices for consumer and industrial applications.

The challenge

… was to be able to increase the production volume of the company's innovative non-moving part water meters quickly and flexibly to meet demand once trials were completed and orders placed.

Flownetix meters were developed to counter problems with conventional mechanical meters which tend to trap air, leading to over-registration of water volume, reduced meter life and incorrect billing.

The Flownetix series of meters are fully electronic non-moving-part meters which operate at very low power. The enclosed battery lasts for 10 years while making 100 measurements per second rather than sampling intermittently. Furthermore, as measurement sensors do not contact the water flow, there are no moving parts to wear and no internal restrictions giving low pressure losses.

The meters can also be read remotely, so removing the onus on either the householder or business owner to read the meter and saving staffing costs of meter readers for the water company.

Whilst the low cost and low power technology used in the product was developed in-house during 2003-4 using existing resources and prototypes, it was necessary to work out how it could be manufactured in very high volume. Potential customers included utilities and contractors around the world looking at projects involving metering tens or hundreds of thousands of customers in one to two year projects.

The solution

It was never feasible to introduce the product at lower volumes and higher prices. But moving up to high volume production - to secure market credibility - would require a heavy investment in machinery and tooling, plus a large increase in staffing.

This dilemma was solved by going into partnership with a manufacturer in South China, a company with an excellent track record of supplying high quality injection mouldings and assemblies to global blue-chip companies.

Issues arising

Going into partnership with the Chinese manufacturer required significant investment and due to the small size of the company at the time, this had to be raised externally.

Investment came in the form of the DTI Small Firms Loan Guarantee scheme and from a private angel investor. This allowed the company to prepare production lines, testing fixtures and injection mould tooling for the whole range of products before going to customers.

Over a period of one year, the partnership developed the tools and techniques to give a production capacity of more than 1 million units per annum while achieving 100% testing of all critical components to maintain quality.

The outcome

With the product fully developed and exhaustively tested, high-volume production is in place for the right delivery schedule and price. The company is now poised to take a significant early share of this new market opportunity as well as offering an intelligent metering solution to those who would normally consider only traditional mechanical meters.

Despite the huge potential, the company is able to retain a small dedicated and highly skilled workforce to concentrate on further research and development (R&D), plus focusing its sales and marketing efforts directly to high volume clients in a global market.

Production will continue to be subcontracted and is flexible enough to respond to peaks and troughs in product demand. Joint venture agreements are pending around the world in order to aggressively enter new markets, though detailed information about these markets is not available for release at this time.

Says Simon Rhodes, Managing Director, 'We place great store in our ability to focus our R&D efforts on leading-edge technologies to stay ahead in our markets. We have applied for world-wide patent protection and we're looking at the R&D tax credits."

What could you do?

Have you developed a new product to the prototype phase but face the dilemma of how to finance the next step to limited or full production?

Is the DTI's Small Firms Loan Guarantee Scheme an option for you? Visit http://www.businesslink.gov.uk to find out more about this and other grants that may be available for you.

If you are a R&D intensive company you may be able to apply for R&D Tax Credits. Find out more at our Tax Credits webpages.

Innovation Exchange

Flownetix website: http://www.flownetix.com

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