Name:
Malcolm Morrison
Age
57
What is your business called?
GMG Energy Limited
Where is it based?
Upper Bighouse, Halladale, Forsinard, Sutherland
What does it produce, what services does it offer?
GMG Energy operates on a farm in the Halladale Strath between Tongue and Thurso. We produce kiln-dried logs, chip and sawdust for consumers and wholesalers and make door to door deliveries throughout the north Highlands. We also manufacture timber products for agricultural businesses, builders and consumers.
Our business is committed to replacing every log of timber we use, so we plant 10,000 new trees a year; we exceeded this target last year, planting about 20,000 trees.
We recently spent £150,000 on a Wood Mizer LT70 sawmill which means that wood from the local area will not now need to be transported 125 miles for processing. As a result, businesses across the North and the Islands can reduce their carbon footprint by sourcing locally. We are investing another £100,000 on a treatment plant to increase our range of products and investigating the possibility of creating heat and steam from wood waste to turn a turbine to self-generate the electricity we use to further minimise our environmental impact. Investment in the treatment plant will open new opportunities in agribusiness and with local construction companies for treated and stress-tested timber. We are also considering some limited manufacture of items such as garden furniture.
We recently made a strategic purchase of 400 acres of softwood-planted land at Quintfall Forest, towards the east coast south of John O’Groats to protect future supply and increase our resilience to market shocks. The forest contains 21,000 tonnes of productive timber, roughly equivalent to 90,000 tree-sized logs. Our sawmill currently processes around 2,000 tonnes a year, meaning that the purchase has given us security of supply for the foreseeable future. Our policy up until now has been to buy our raw materials on the open market from established local suppliers, but we can now ensure continuity of supply in an increasingly volatile environment. Quintfall is just over 20 miles from our base of operation at Bighouse Farm, so will not add much to the road miles burden and the acquisition aligns with our wish to invest locally and provide a reliable resource for other local companies. Nor does this purchase affect our ongoing planting programme, as replenishment is the key to sustainability, and we will continue to try to reduce our impact on the environment by not wasting any of the product with which we work.
To whom does it sell?
Consumers and wholesalers locally but we are looking north, not south, for markets and have clients such as a pallet manufacturer in Orkney who supplies the fishing industry. Local estates and farms are outlets for fence posts, gate rails, cladding and the like. Customers can cut down on imported timber and timber products, road miles can be minimised and a sustainable market can be created for this area’s abundant forestry resources.
What is its turnover?
£2m in this current year.
How many employees?
10
When was it formed?
2016
Why did you take the plunge?
When I worked for Clydesdale and then Santander banks I had a lot of customers who were exploring renewables and I saw the opportunities which were becoming available so, in 2016, I set up a standalone renewables business with six-megawatt biomass boilers to dry logs, sawdust and chips. Then, as now, our farm has 200 acres of trees so I was pretty familiar with the timber market. The sawmill, which gives us further wood processing capability, was established just 18 months ago with support from the Forestry Commission and the business now has six full-time staff and one employee, a shepherd, on the farm.
I believe in leveraging assets in search of a sensible return. As a farmer from boyhood I am all too aware that the agricultural business is risky and that returns can be low. This is the exact opposite of the mantra that high risk should equal high rewards which I learned and fully endorsed in my time as a banker to the agricultural sector. I have been planting trees on our farm land since 1993 and they are still growing, aside from selected trees that we have cut annually and sold at Christmastime. Most of the original planting will be ready for harvest from 2027 / 2028, that is, typically, after 35 years of growth.
What were you doing before you took the plunge?
I was studying in agricultural economics at Glasgow University but decided to return to farming before going into the agricultural business sector and thence into Agri banking, initially with Clydesdale Bank.
How did you raise the start-up funding?
With our own capital, supported by medium term loans provided by the excellent Paul Healy and Sandy Hay, and now Jaqui McLaren, at Bank of Scotland in Dumfriesshire where I live.
What was your biggest break?
When I was 19 or 20 I had the privilege of working for my grandmother, Annie Douglas, on the family farm. She was an amazing person, a farmer and businesswoman and an inspiration to me in her integrity and clear focus on achievement. Another big break was meeting Andrew Shepherd, now chairman of property consultants, Galbraith Group. He mentored me and taught me the importance of having a vision for your business and of seeing things through to a conclusion. More recently, I have had the good fortune to have another mentor in Stuart Clark, managing director of our accountants and financial advisers, Russell & Russell.
What was your worst moment?
No specific worst moment but I find the constant, fractious engagement with the planning authorities very wearing. It seems to me that we should really be on the same side in seeking enhanced economic opportunities for the rural north of Scotland but the planning system and its long-drawn-out processes sometimes make you wonder.
What do you most enjoy about running the business?
I enjoy creating and sharing wealth and the feeling of success that comes with it. Working with my team and growing the business, having it punch above its weight in a rural area and becoming steadily more profitable as we innovate and develop it is a great source of enjoyment.
What are your ambitions for the business?
To grow steadily and profitably and to provide local people with the opportunity to have a productive career in a professional environment which delivers success for everyone.
What are your top priorities?
Profitability, staff wellbeing in a safe and supportive environment and continuing to contribute to the North of Scotland economy.
What could the Westminster and/or Scottish governments do that would help?
Both governments need to relax planning regulations, let entrepreneurs be entrepreneurial and encourage investment that can secure a good return. They should also invest a lot more in infrastructure, especially the road network, to encourage commercial trade.
What was the most valuable lesson that you learned?
If you aim to be successful, surround yourself with clever people. If you find you are the smartest person in the room, you are in the wrong room.
How do you relax?
Watching our children’s success and spending time with close friends.
A version of this story appeared in: https://www.heraldscotland.com/business_hq/20056532.highland-timber-firm-supports-rural-jobs/