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There’s a sign on the wall inside the John Smedley knitwear factory that reads: “Exit in case of fire or air raid”. In fact, the business is even older than the sign suggests, but it and much of John Smedley’s culture belies the fact that this is a progressive outfit that sees itself as going places. John Smedley is a rare thing in post-industrial England. It’s not only a surviving but a thriving traditional manufacturing enterprise.

For 223 years, its sprawling factory in the heart of rural Derbyshire, 170km north of London, has been producing under, and then outer, garments; and it has built up a following among stylists, fashion designers, and aficionados from Tokyo to Moscow. Meanwhile, most of its textile rivals have shut up shop in the UK.

John Smedley the business was the brainchild of two local members of the landed gentry who, in the late 18th century, saw which way the entrepreneurial wind was blowing. The first John Smedley teamed up with Peter Nightingale (great uncle of Britain’s most famous nurse, Florence) and looked to local businessman Richard Arkwright for inspiration. Arkwright had set up a mill and installed his new spinning invention, the water-frame, which effectively heralded the start of the industrial revolution.

Nightingale and Smedley bought their own mill in the village of Lea, so that they could use the brook that ran through the valley to provide motive power and a constant source of running water. To begin with, they focused on muslin and spinning cotton but by the 19th century they had move into knitting and hosiery manufacture. Smedley’s son, another John, took over the firm in 1825. Under his modern stewardship, all the manufacturing processes needed to produce the finished product were brought together under one roof at Lea.

A further bout of expansion was overseen by John B Marsden Smedley, who installed the latest knitting machines, and, in 1893, turned the business into a limited company. Over the next half century the company extended its underwear line to include swimwear and nightwear for men and women. Then in the 1960s the brand’s signature fine-gauge sweater line took off, giving the company its first real growth in overseas markets. Today, two members of the Smedley clan sit on the board as non-executive directors, but it is run by professional management who also seem to respect the legacy. “We think of ourselves as curators, as we are here for a short period in the company’s history,” says head of knitwear design Dawne Stubbs.

To say John Smedley has bucked the trend is an understatement. In the past decade knitwear businesses like Courtaulds, Cox Moore, Cooper and Roe, and Coates Viyella have either folded or taken their manufacturing overseas. “Few major companies are still knitting in the UK,” says managing director Drew Walker. He accuses the “pseudo-British brands” who now source abroad of taking the short-term, quick-profit fix.

John Smedley has managed to survive by spending the past half-dozen years reinventing itself. It’s gone from supplying labels such as Paul Smith, Margaret Howell and Katharine Hamnett, and UK gentlemen’s outfitters, to being a high-profile, international luxury brand. Today, 70 per cent of sales come from overseas. The UK accounts for 35 per cent, followed by Japan at 24 per cent, both Italy and Germany at 6 per cent, and France at 4 per cent. Russia is its fastest-growing market.

In 2005, it posted a profit of £728,000 (€1.08m) and turnover of £13.3m (€19.7m), compared with a £775,400 (€1.1m) loss on a turnover of £12.1m (€17.9m) in 2003, when the business was still suffering from internal problems and the worldwide recession.

It seems that long-term management, benign shareholders, an injection of contemporary design, and the general consumer Zeitgeist have all come together to give John Smedley a new lease of life. The firm’s focus on top-quality raw materials, classic designs and a skilled UK workforce presses all the right buttons for today’s discerning customer. Quality, authenticity and provenance are the current buzzwords, and John Smedley has all three in bucketloads.

In the dark days at the beginning of the millennium “there were huge temptations to take the business offshore,” says Walker. “But ‘Made in England’ is what we are. We have stayed true to our values, and it’s almost as if the world is catching up.” Management certainly sees its fixation with quality as being part of its success. It’s competing now against any brand with fine-gauge knitwear, from Burberry, Pringle, Gucci and Calvin Klein to Ralph Lauren. “But they sell on the power of the brand rather than the quality of the product,” says Stubbs.

It all happens in an hq that is an unexpected combination of stepping back in time and the latest in hi-tech innovation. In its culture and in many of its processes, John Smedley honours its heritage. For a start, its 450-strong workforce comprises many locals who have been on the payroll all their working life. By 2007, two employees will have served 40 years and two 25 years – a pretty average tally, apparently. And Danny Townsend will retire in July at 65, having started as a knitter when he was 15.

Not only do staff seem to stay forever, they are often – like the Smedleys – following in familial footsteps. Danny Townsend’s grandmother pressed finished garments there between the two world wars. Marie Nicholson, of 20 years standing and soon to be promoted to trim manager, has a brother-in-law working in the dye house; while finished knitwear manager Brian Greaves, who will have served 40 years this August, has a daughter on reception, a niece in planning, and a brother-in-law in spinning.

These people have witnessed significant changes as knitwear technology has advanced – in fact in recent years the company’s capital expenditure has outstripped its profits. “There’s been a lot of modernisation of machinery, it’s much less labour-intensive now,” says Greaves.

Peter White, a knitting technician at John Smedley for 20 years, echoes this. “Each knitting statement [pattern for the machines] had to be built by hand. Now it’s computerised.” So whereas in the old days, it would take four hours to make up statements for six sizes, it’s now down to an hour and a half.

Despite the introduction of speedier machines, there are still plenty of fit-looking tattooed workmen sporting earplugs from the candy-like wall dispensers. Stubbs and Jackson know their male shop-floor workers are in good nick as they use them to size the garments. They can never find any double or triple extra large specimens among them.

A garment’s life starts out as some of the finest Merino New Zealand wool, where the sheep are “free range”, not kept in fields, many on family-owned farms. This yarn is first knitted into ribs: the bottoms, cuffs and neck trims of sweaters. Here, digital machines sit alongside some that are 40 years old. The knitting proper starts at the knitting shed – the powerhouse of the organisation.

John Smedley’s finest knit is 30 gauge, meaning that in 1.5 inches there are 30 needles in the needle bed, or 30 stitches. “To knit that fine, your yarn has to be perfect, like gold thread,” says Stubbs, “The opportunity for error is vast and you can’t correct mistakes easily. So the skilled workforce operates at a very detailed level.”

Different machines can knit different kinds of garments, so it is up to Stubbs and senior designer Gemma Jackson – whose arrival three years ago heralded the return of in-house design – to create collections that make good use of all the equipment, including the company’s latest gadgets. These include the Intarsia machine, which knits elaborate Argyll patterns, and the labour-saving Shima Seiki Whole Garment machine, which creates seamless, sculptural items, branded as its One range. John Smedley boasts the only four of these novelties outside Japan, which it bought two years ago at £125,000 (€185,000) each.

For all except One items, the garment panels and sleeves are then seamed together by the “linkers”. Once the garment is in one piece, it’s sent down a primitive-looking wooden shoot to be “dressed”. At this point, it’s washed in cylindrical steel vats in the local spring water to get the oils out of the wool, make it shrink-resistant and “relax” it. From there, it’s thrown into enormous tumble dryers. John Clayton, who works in the dressing room, says they can get through around 140 dozen a day. Everyone here talks in dozens as the machines knit that number of garments at a time.

Each piece is then pressed – pulled over the old-style sycamore boards and sandwiched into a hot Hoffman press (there are still boards knocking around for long-deceased long-johns – before central heating made such garments unnecessary), or in one of the six new and flexible pressing machines. It’s then back to the seamstresses for the neck to be finished off and waste yarn removed, followed by final touches such as button holes and labels – all of which is done by hand. Nowadays, just 15 per cent bear the logos of brands such as Paul Smith and Margaret Howell. Then it’s time for the final checking and pressing.

Despite all the new equipment, it seems a laborious and many-stepped process, as each garment is passed between myriad rooms over a 13-hour period. But that’s where the attention to detail and belief in the time-honoured process come in. The result is 500,000 garments a year, or 800 dozen a week.

New machines may speed up the process, but they can’t replace all the hand-finishing specialists. Because while the longevity of service is impressive, John Smedley is finding it difficult to entice new recruits.

What would the career path of a young knitter or linker be, with no other textile manufacturers around? To counter this, the company is not only investing in labour-saving knitting equipment but also trying to structure an internal career path from the shop floor to management. On an informal level, this obviously works already. Greaves started at 16 as a clerk in the knitwear office, and did a stint in every department before winding up in management.

Perhaps if Walker and his team can convince potential employees of the company’s dynamism and exciting expansion plans, they may go some way to solving their recruitment issues. For management now believes that the brand is strong enough to venture way beyond its classic collections. As well as the seamless One sub-brand, other recent innovations include John Smedley Mode, a capsule collection designed this year by guest graduate designer Eduh Joseph, a lingerie range for Agent Provocateur, and a children’s line. And now, they are on a quest for the right partners to manufacture non-knitwear clothing – off site but still in the UK – for an autumn 2008 launch.

John Smedley’s star is in the ascendancy. It may be a small, family-owned business in the backwaters of rural England, but it has transformed these seeming handicaps into assets. And now it has found its feet, it is out to make the most of its new-found profile.

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