You make my head spin...
Concept 1900, a merry-go-round designer based in the North of France, has succeeded in turning a traditional market into a dynamic business with a strong focus on exports, thanks to a strategy built on innovation.
From real horses... to wooden ones
This thriving business began with one man, Philippe Legrain. 35 years ago, this former professional horse rider decided to try his hand at decoration by creating an original series of wooden horses. He very quickly identified a lucrative market for the maintenance of traditional merry-go-rounds that were becoming obsolete, and two years later, he started producing his own merry-go-rounds. This was the start of the Concept 1900 adventure! Since then, the business, which set up residence in the disused Saint-Gobain factory... in the village of Saint-Gobain in the Aisne region of France, has been producing carousels and a wide range of accessories. Its catalogue contains a safe bet: the famous wooden horses that rise and fall continuously as the merry-go-round turns. “We market traditional carousels as well as products based on specific themes such as Jules Verne or inspired by blockbuster films,” explained Philipe Legrain. Despite what people might think, this is a thriving market and we receive orders from prestigious customers. “We’ve just delivered a brand new merry-go-round that has been installed in the Jardin d’Acclimatation in Paris since March. That park is owned by LVMH. And we’re designed another one for Longines. It now accompanies the famous watchmaker to promote its sponsoring activities throughout the world. Our carousels have pride of place in all the major theme parks worldwide, at Disneyland Paris, for example.” As a result of all this, exports account for 80% of all Concept 1900 sales, and 500 merry-go-rounds produced by the company are currently in service around the world. "We also work with fairground companies at local level. Our merry-go-rounds are often intricately linked to the history of a town square or neighbourhood. We are proud to create products that are destined to provide moments of joy for children as well as their parents and grandparents over many years, and are committed to doing so."
Traditional techniques, sustained innovation
Building a merry-go-round is much more complicated than it looks. “It involves a hefty dose of know-how. We work within a traditional sector, but the standards to be complied with are complex and sometimes even contradictory.” For example, a carousel sold in France will have to be modified to bring it into line with US regulations. The product design also involves a diverse range of professions. “We employ people specialised in wood, steel, boilermaking and even polyester. And if we don’t have the skills required, we seek them out.” In addition to its teams - 45 people in total - Concept 1900 works with almost 80 regional companies. “It’s important to me that we are part of the local economy and help to create jobs at local level. This is also a way of ensuring we maintain certain craftsmanship skills, by using renewable raw materials that can be almost entirely recycled at the end of their life cycle.” This industrial agility means that the business has a genuine ability to innovate. “We are leading the way in terms of performance, by incorporating LED technology into our merry-go-rounds, for example. This has enabled us to reduce their energy consumption by 80%. That’s a huge figure, given that a merry-go-round has a service life of 50 years. We also innovate by offering new products.” And there lies the question of funding.
Funding innovation... An essential issue
For Concept 1900, the issue when it comes to innovation is not so much finding new ideas - the business is overflowing with projects in progress - as how to fund them. “Our new products have no problem finding a market, but without funding, they would never get off the ground. The BPI investment fund plays a vital role in this respect and I strongly advise small businesses to get in touch with them, as well as their regional chambers of commerce. We also work closely with partners such as Societe Generale. The bank is fully aware of our business’s potential and always offers its enthusiastic support for ambitious projects such as the new Madagascar carousel we have just delivered to a theme park in Dubai. I chose to work with Societe Generale because the assistance it offers us in the field of exports is a true source of added value. This is certainly one of its strengths, and it has a particularly attractive global network."
Advice for preparing a smooth transition
Now aged 63, Philippe has been considering selling his company for some time. “I’d found a buyer, but I decided to call off the sale.” Why? On the one hand, I realised the impact of tax owing on the amount generated by the sale. On the other hand, the value of the business was underestimated due to a lack of clarity regarding the company’s operational structure. “Potential buyers need to see how the business operates. At the moment, I am too involved at all management levels, which means the company relies heavily on me personally. Transfer specialists call that a significant “intuitu personae” and in concrete terms, it decreases the sale price. As a result, I decided to change my approach. Concept 1900 has begun the process of ISO 9001 certification. Our work to obtain ISO certification will help us structure our processes and as a result, our organisation will be more “transferable” to a successor. The business will then be easier to sell on when the time comes. I’m in no hurry: my concern is simply to identify the right buyer.” And the business has huge potential. “Recently, a major luxury brand invested over €400,000 to create a merry-go-round for a single procession!” And Philippe concludes: “What advice would I give to a company looking to sell its business? Make sure you take steps to prepare the transfer well in advance. You need to develop robust financial engineering with a specialist and make your business as attractive and accessible as possible to potential buyers. That’s the best way of making the most of all those years of hard work and dedication, and all the sacrifices that can be involved in running a business. And I’m taking my own advice straight away, because I’m aiming to achieve revenues of over €10M and attract new talents that will contribute to the business’s future success."