A manufacturer is optimistic for future growth after winning a lucrative contract to supply the rapidly-expanding e-cigarette market.
Stanley-based SONE Products Ltd supplies packaging solutions to the cosmetics, healthcare and diagnostics sectors, currently producing mascaras, eyeliners and lip gloss packs for the cosmetics industry.
The £7.22m turnover business is now branching into the fast-growing electronic cigarette sector, having been awarded a three-year contract to supply bottles, caps and dropper plugs to new client The E-liquid Company (NW) Ltd.
The supply agreement will see SONE use its in-house processing capabilities to manufacture an estimated one million packs per year as part of the deal, secured for an undisclosed sum, with first packs due to roll off production this month.
The contract win represents positive news for the company, established in the North East 33 years ago, which was last October forced to make 46 redundancies after a major customer drastically reduced its order.
The jobs blow followed a period of expansion after a string of contract wins and came shortly after it made significant investments in machinery. The firm also benefited from £250,000 Let’s Grow cash – the fund managed by The Journal and Evening Gazette in collaboration with BE Group and UNW LLP.
As of October, orders from its major customer stood at 50% less than August levels, but the latest order from the E-liquid Company brings the firm reason to be optimistic.
It builds on SONE’s experience of working for clients in healthcare, a sector it continues to target. Based in Blackburn, The E-liquid Company which supplies e-liquid for refillable electronic cigarettes, is a relative newcomer to an industry which is estimated to see some 4% of the global smoking market switched to by 2050.
Business development manager, Tony Burnell, said: “Securing this three year supply agreement is excellent news. Our ability to take an holistic approach is welcomed by our clients, as we are able to provide them with added value services across aspects of their products. We are looking forward to being able to build and strengthen in this sector at some point later in the year.”
Suhail Virmani, The E-Liquid Company’s director, added: “The development process was a fantastic journey and the resulting pack will be a game changer in our market. Also, the fact that SONE manufactures products in the UK fits really well with our own ‘home grown’ approach. We are very impressed overall.”