Monday Interview: Tom Flockhart, Capital Document Solutions

Tom Flockhart used property proft to set up a base from which his firm started trading. Picture: Rob McDougall

Founded by Flockhart in 1979, Capital generated turnover of £22 million during the year to March on sales of copiers, printers, scanners and software to private and public sector organisations across Scotland. It has more than 13,000 devices in service, but Flockhart insists he has yet to conquer the tough office equipment sector.

“It is a very competitive market, which is why I enjoy it,” says the former Preston Lodge wing forward. “It is almost like playing rugby all the time.”

Although sales this past year edged just 4 per cent higher, pre-tax profits rose by 13 per cent to £1.5m, driven by Capital’s heavy deployment of so-called “click machines”. This is equipment that has either been purchased or leased by the customer, who then pays Capital a set price for every copy made. In exchange, Capital supplies maintenance and consumables for the lifetime of those machines.

Tom Flockhart sold his house in Stonehaven.

More than 80 per cent of Capital’s equipment in the field are click  machines, and in turn they generate about 60 per cent of the company’s turnover. It makes for steadier revenue streams, and is an incentive for Capital to ensure that any faults are quickly repaired.

“It is a major motivator to keep service levels high,” says Flockhart, who employs 205 people from the company’s headquarters in Edinburgh and further operations in Aberdeen, Dundee, Glasgow, Inverness and Shetland.

A zealot of “great service”, he sets high standards for staff and apprentices, who are expected to work as hard as their managing director has throughout most of his life.

Born in Edinburgh in 1949, Flockhart was adopted at the age of one by a family of modest means in Prestonpans, East Lothian. He recognised early on that his home “was not as well-equipped as some others”, and was abashed when friends came over to his house.

“I was embarrassed by poverty, and I used that as a driver,” he says. “I just said to myself, ‘Don’t be embarrassed – do something about it.’

“It didn’t motivate me in a bad way, like going to beat up old ladies and steal their purses. It motivated me to work.”

Which is what he did in the form of a string of odd jobs from an early age, including a stretch cleaning floors in a sweetie factory. His pay was a jar of sweeties, which he would then take home, put into pokes and sell on to his classmates at school.

He went on to feed his appetite to both earn and learn with a four-year student apprenticeship at Ferranti in Edinburgh, completing an HND in mechanical engineering.

He then joined 3M Company as a copier salesman, covering territories throughout Scotland before moving to Aberdeen in 1976 to start up 3M’s copier sales in that area.

The move was a “great challenge”, Flockhart recalls, admitting that it was also one at which he nearly failed.

“It scared the hell out of me,” he says. “After the first year I nearly packed it in, because it was just such hard work.”

He made little to no progress in that first year, a result Flockhart blames in part on his approach to the job. Local companies in Aberdeen preferred local suppliers, while the oil and gas majors has international contracts for their office equipment.

He then hit upon a specialist sub-sector that would eventually earn him the title of “Oil Baron” within 3M.

In an era with neither the internet nor scanners, many business functions were dominated by large, cumbersome copying equipment running on a cocktail of chemicals.

Flockhart realised that 3M’s then-unique “Magne-Dry” equipment was ideal for offshore platforms on two counts – the desktop copiers could be delivered by helicopter rather than supply vessel, while their use of toner powder eliminated fire risks.

He threw himself into this niche market, flying from platform to platform, and sales took off. Impressed with what they had seen offshore, majors and suppliers onshore started buying the equipment as well.

By 1979, Flockhart was 3M’s top copier salesman in the UK. However, changes in the market and a longing to return to East Lothian led him to strike out on his own.

The difference in the selling price for his house in Stonehaven and the cost of his new home in Longniddry produced the cash for a 1,000 square foot shop in Edinburgh’s Montrose Terrace, where Capital Document Solutions began trading. Flockhart quickly secured a dealership agreement with Sharp, and from there the company grew.

Capital’s market share varies from one region to the next, ranging from  10 or 15 per cent in Aberdeen to as much as 60 per cent in the Borders. Flockhart has no plans to push into England or elsewhere, as there is yet plenty for the company to do on its home territory.

“Our aim is to simply do more volume on what has been a very major investment for us over the last couple of years,” he says.

“We want to conquer Scotland first, and frankly there are still challenges here.”