Entrepreneurship for Life with Paul Shortt

Patrick Daly:

Hello, this is Patrick Daly and welcome to Interlinks. Interlinks is a program about connections, international business, supply chains, globalization, and perhaps we have to say now de-globalization and their effects on how we live, work, and travel in the world today. Today on the show, we’ll be talking to Paul Shortt, accountant, businessman and entrepreneur from the county of Monaghan. Paul was the founder and CEO of Castlecool Limited, logistics business specializing in temperature control, storage, and warehousing. And that was for 22 and a half years, between 1994 and 2016. Since then, Paul has been CEO of PVS consultancy, offering, mentoring, coaching, and professional advice to SMEs and voluntary associations. So welcome, Paul. Thanks very much for being here with us today.

Paul Shortt:

Thank you. Thanks. It’s a pleasure to be on board with you guys.

Patrick Daly:

Delighted to have you, Paul. To kick things off, could you give our listeners maybe an overview of your career and, say, particularly the founding and the building up of the business of Castlecool Limited in Castleblayney?

Paul Shortt:

Yeah. After finishing secondary school, I went to do a accountancy in Dublin with PWC. Spent seven or eight years there, essentially qualifies as an accountant. Came back to County Monaghan in ’74, ’75, and joined a local cooperative called Lough Egish. Lough Egish in the year or two after that, formed a new venture with a group of Norwegians in establishing what they call a food park. A food park was where they would provide central services such as a cold storage, effluent treatment, gas, supply all the central facilities, and to build up what they call a food park. Fortunately from that date to now, it’s been very, very successful in the development in a very rural area of County Monaghan. We’ve known food factories on site and quite extensive range of services to the food industry.

I joined that company, it was called Norish, which was Norway, Irish, as the accountant, and eventually ended up as financial director of the company. We expanded with a number of operations throughout the country and in Dublin, Kilkenny, Belfast, Craigavon, et cetera. The company, after about 10 years, its founding shareholders decided that some wanted to exit the company and decided that the only way of doing that was to go public, going to stock market. That was quite an achievement for a small company in County Monaghan. No company had gone to the stock market for 16 years before that, and it was quite a difficult time.

Patrick Daly:

When did you do that? Was that early ’90s, late ’80s?

Paul Shortt:

1986.

Patrick Daly:

’86, okay.

Paul Shortt:

It was called Norish PLC. Now, the company had been trading very, very profitable because the cold storage industry at that stage was relying heavily in the 1970s and ’80s on what they call intervention beef. This was the EU intervening in stockpiling surplus food products for the country.

Patrick Daly:

Yeah. I was trying to explain that to a young person recently, and they thought I was crazy. The EU used to buy meat and butter that had no market, and they used to put it in warehouses and pay for it to be warehouses. Is that right?

Paul Shortt:

Correct. At that stage, because of the demand and because of the services, and there was no traceability needed to just get it in the boxes into the store and away you go, at that stage, the country had about 600,000 pallets of frozen food in all ships of sizes of stores. Going back again to Norish, Norish went in the stock market and was successfully launched, and-

Patrick Daly:

That was a very difficult period in the economy in Ireland, wasn’t it?

Paul Shortt:

Extremely difficult because whilst the beef and butter produce was continuing to be provided, markets was the difficult thing in finding good markets and good processes for the raw material. Anyway, the company Norish went in the stock market. It didn’t please many of our competitors because the country and our customers knew what we were making and what we were achieving. However, that was it. In the late 1980s, the intervention was sold off. All that beef and butter and produce was sold off to Russia and to other countries. It was given away by the EU and the intervention process was discontinued at that stage. It meant that now the market for the cold storage business was very, very limited and a lot of properties that were sold off. From a high of about 600,000 pallets of produce, that reduced to about 250,000 over a number of years. At the moment, that’s what we’re looking at in the cold storage business.

The company Norish continued to trade and decided that it would need to expand into the UK and went and established a number of facilities in the Midlands of the UK. At that stage, I got a little bit disillusioned with the way our company was going, and I decided to leave in 1994 and set up my own company in competition. I set up Castlecool and trail quite well. The difficulty with cold storage business is that it’s a very capital intensive building to put up, and so you need the resources. I had a VC and different people who were backing me to set up the process, and we took off. Over the years then I ended up buying back the cold stores at the Lough Egish food park. I ended up where I started, if you like to call it, right? I ended up having the largest cold storage facilities in the island of Ireland at that stage.

Patrick Daly:

What kind of customers were coming to you at that point?

Paul Shortt:

What was happening was there was a transformation in that regulations were getting tighter, the quality controls were getting stronger. Traceability was a very, very important thing. It wasn’t a matter of putting projects into a warehouse and picking anything out. You had to identify every box. I used to train our staff saying that we had systems stronger than the banking because if you go into a bank with a 10 pound note and come back the following day and ask for your 10 pound note, you get some other 10 pound note. But with the cold storage business, whatever you put in, whatever box you put in, do you want that actual box back out? The regulations were very, very tight. Systems also had changed in the racking systems. The operations refrigeration had improved, and the industry in general had tightened up a lot. It ended up just with a number of players within the island of Ireland.

However, all the changes were starting to take place worldwide in the industry in that, particularly in the US it started that real estate investment trust were starting to buy up family businesses because the business in the cold storage industry is cash rich in that it doesn’t have a big requirement for working capital as such. It doesn’t carry stocks, it only has debtors on its balance sheet as such, so its working capital requirements are very, very limited. These real estate investments trust started buying up cold stores and famous companies like Frigoscania and Christian Salvesen, which were household names, were suddenly being bought up. These reach continued and moved across the pond and moved across to the UK and into Europe and into Ireland. That’s what happened in my company in that I had reached retirement age, and elites from the west coast of the USA spot up Castlecool eventually.

Patrick Daly:

Okay, so this was, what, around 2016?

Paul Shortt:

2014, yes. Yeah.

Patrick Daly:

Okay. So how has the industry, so you explained there the early days and the birth of that industry was around the intervention beef and butter and other produce. How has it evolved the business since then? Now, we’re in a situation where at least I see pharmaceutical companies and biotech companies are in the market looking for cold storage. How has the market evolved in recent years?

Paul Shortt:

Well, in two fields in that, first of all the customers are requiring more services for our sake. They’re requiring cold storage companies down to take various, whether it’s transport logistics, whether it’s repacking, whether it’s shipping stuff by airline, et cetera. A lot of produce are going out chilled and fresh from cold stores to the Middle East on a daily basis. Traceability has to be very, very tight. Labeling of Arabic produce and all that type of stuff has to be done. Secondly then, the pharma industry now requires a range of temperatures. The normal range of temperature was mainly 18 centigrade, which is zero Fahrenheit, so that was used for food industry. But the pharma now is looking for temperatures even as low as minus 60, so it’s quite extreme. The chambers for the pharma industry within the cold stores are getting smaller and smaller because the produce it’s not a big produce, but it’s requirements. So you’ve got requirements from pharma-

Patrick Daly:

Are these different businesses or the same companies addressing both the food industry and the pharma industry?

Paul Shortt:

Some companies have both. Have the food in one chamber and have pharma in other chambers as such. And then the additional services that were required then have made the buildings bigger and more demanding. The customs and exercise controls the department by culture controls, the medicine board and all that, have all the different controls. There is a lot of regulation involved in the modern cold storage industry.

Patrick Daly:

As you said, you don’t need a whole lot of working capital, but it’s a big CapEx expenditure because how would you compare, say, the building of a cold store as against building a conventional warehouse? What’s the difference in terms of technology and cost and so on?

Paul Shortt:

Well, if you have the same warehousing space, but in a cold store, you will have the refrigeration rooms, you will have forklift rooms, you’ll have different other chambers. Then you’ll have the packing stations. You’ll have actually the office facilities. The yard is a big, big thing because in logistics, your yard should be nearly twice the size of what your space that you’re comparing in your warehouse. So that’s demanding as well and costly on the deck.

Patrick Daly:

I guess even the building of the building itself, the floors need to be insulated, the walls and the roof need to be insulated. There needs to be blowers and all sorts of devices inside to generate the temperatures you’re looking for.

Paul Shortt:

Well, the most important part of the cool storage is the floor because the floor has on the floor heating to stop thermostat coming up in the concrete and causing potholes, et cetera, so you’ve got that. But nowadays, the racking is becoming a lot more sophisticated in that there’s robots now involved in the modern warehouses. It means that a lot of these warehouses now either have trains or robots, and they’re working in the dark, they’re working 24 hours a day. They’re very, very effective. With good IT systems and traceability, they work very, very well. The reason why that’s going is, first of all is, you’ll get higher density from these new modern racking systems. Secondly, they’re operating in the dark so that your electricity charges are reduced. And thirdly then your workforce, you don’t need work people within the warehouse as such. It’s all coming down to cost savings and benefits.

Patrick Daly:

Do we have the expertise and the capacity in Ireland to design, build, commission, and operate the type of temperature controlled infrastructure that we’re going to need to support food, pharma, and biotech into the future?

Paul Shortt:

We have, yes, because well, you’ve got Kingspan fighting the insulation, which is a big source. Naturally you’ve got a lot of contractors now who have experiences in building these warehouses. You’ve got the systems, you’ve got the cranes, you’ve got all these types of systems now that can be easily installed. We’ve got now Moffet Automation, which is providing the robots within the stores.

Patrick Daly:

Yes. All of those companies that you mentioned are all from that Monaghan County area, aren’t they?

Paul Shortt:

Oh, yeah.

Patrick Daly:

[inaudible 00:16:13] and Monaghan town and Castleblayney.

Paul Shortt:

Yeah, the poor part of the whole country.

Patrick Daly:

That’s what they like to have us believe.

Paul Shortt:

Yeah, yeah.

Patrick Daly:

What about transport, then? What are the challenges in maintaining the cold chain and broken through the various transport modes, say, from factory to warehouse and from warehouse to point of use? Because point of use could be thousands of kilometers away in the desert or a tropical region in pharmaceuticals. How’s that done? What’s the challenge there?

Paul Shortt:

Well, the challenge in the past, in the ’70s and ’80s, refrigerators transport in Ireland was very scattered around the place. In that small operators, you had very, very little regulation. You had poor systems or refrigeration on the trucks, but that has all improved dramatically. Traditionally in the past, the cold storage and the transport companies operated separately. But now they’re finding that the integration of the logistics with the warehouses is becoming a key part of it because transport companies are now, their customers are demanding that they have a certain amount of cold storage and warehousing facilities to help their situation.

The transport also has improved in the quality of the units that’s been used, the experiences that people have gone from shipping or transporting throughout the UK, first of all, and then onto the European market. The people in the transport industry have no problem going as far as Italy or Egypt or any of these places now. Whereas 20, 30 years ago, it was a big problem. That’s all changed now totally. Unfortunately the regulations and the demands from the various governments on customs veterinary regulations are very, very difficult. But we find now even that, as I said earlier on, that products now, chill products have been transported by airline to the Middle East on a daily basis. That’s a real transformation altogether in that people are able to get the product to the market very, very quickly. It’s more expensive, but they’re going to markets that can take the cost we like to call it, of having these and the following, the Irish diaspora, wherever they are.

Patrick Daly:

Yeah. Now, since you left Castlecool 2016, you’ve been working as a consultant in your own consultancy, PVS, rather. You’re providing mentoring and advice to SMEs and voluntary associations. What’s the most interesting thing that you’ve done in your work at PVS, say, over the last number of years?

Paul Shortt:

Well, I’ve found, first of all, that I’ve been working for the AD and Enterprise Ireland and the Leos and Leader and different people like that in mentoring. I found that in this region, there’s quite a lot of small good enterprises, either in the engineering or in the food or in other industries that require a bit of help and a bit of a lift up in overcoming certain difficulties that they have. I’ll give you an example in that. There was one company that we done a bit of work on that had a foreign owner, and the management was struggling. So we ended up advise them to get a management buyout, and they bought the company, the management, and it was very, very successful.

There’s other companies then that we have worked in that require new buildings, new fit outs of engineering in particular. And in this area you’ve got a lot of engineering, you’ve got a lot of woodwork people requiring the modern machineries, the CNCs, and all these different equipment. And the funding is there in fairness to the local and the government agencies that can identify and can see progress. And at the moment, I mean in this region, we’ve got quite a good economy of businesses and more coming along. It’s an area that has been very enterprise and the region has been identified as being very enterprise and doing quite well for themselves.

Patrick Daly:

What’s the more to Monaghan initiative that you’re involved with?

Paul Shortt:

More to Monaghan is, again, is to encourage more people, more industries to relocate, to identifying the good points of the county, identifying housing, identifying the labor, identifying our location. Our location’s quite unique in that we are close to Northern Ireland. Half the county, if you look at the map of Monaghan, half the county is practically in Northern Ireland.

Patrick Daly:

Like a salient, yeah.

Paul Shortt:

Yes. And we have the influences from, we have a lot of Northern Ireland people working in the region, in the area, and vice versa and we’ve got people going there. A lot of kids after leaving secondary school are going to be educated in Belfast or in the north, but coming back with their whole qualifications and settling in the area. What’s happening in Northern Ireland is going to benefit as well because as you well know, Northern Ireland is a unique situation in that they’re still part of the UK, but they’re also within the EU market. And a lot of our companies are supplying services and facilities to these companies in Northern Ireland. So generally, I think the outlook is quite good for the region, so it is.

Patrick Daly:

Yeah, Northern Ireland has a unique position, as you say. And if they play their cards right, they can do very well out of that, I think.

Paul Shortt:

And hopefully they will. And hopefully this politics will all drop out of that whole thing.

Patrick Daly:

Yeah, hopefully. Hopefully. So maybe just focusing on you maybe a little bit as Paul Shortt, the person. So what would you consider to be your most important leadership characteristic that’s enabled you or sustained you through your career? I mean, first as an employee for those businesses you explained to us and a manager, and then you became a founder and a CEO, and now you’re a consultant helping other companies. So what leadership characteristic of yours do you think?

Paul Shortt:

I remember doing my leaving search and what do you want to do when you leave? And I put down accounting and I forget what the second one was, but in the ’70s, no such thing as marketing. There was no salesman. And when I came back, they said, you better forget about accounting and become a salesman. But in the ’70s, the idea of a salesman was somebody working for a piece of cigarette factory, and going around pubs and selling cigarettes and all that. And that didn’t stand to me. So when I set up my own company, I found that one of the first things I did was to employ an accountant to undertake the functions. And then I got back out into marketing, into selling.

I believe it’s very, very important that you identify your customers, go and see your customers on a regular basis, whether it’s good news or bad news. And another angle then is every customer that you would have, all of us has some difficulty within their own business to overcome and ask them, is there any way I can help you in overcoming some of your difficulties? With various international companies such as Heinz and everything else, we ended up being major parts of their manufacturing process. So I think when you’re working with your customers, is identifying what issues they have and seeking you help and resolve some of the issues for them.

Patrick Daly:

It’s the ability to develop the relationship, actually the personal relationship and trust, so they’d actually tell you what their problems are. Otherwise they didn’t trust you, didn’t even tell you, would they?

Paul Shortt:

Yes. Yes, indeed. Yeah. Now I know I left a few meetings and haven’t seen, yes, we can solve that, but we went back our own team, we had no clue how we were going to do it, but we worked through it and it was beneficial to both parties too.

Patrick Daly:

And then outside of work, what kind of things do you like to do?

Paul Shortt:

Well, I’m very involved in the local community, and we have a number of enterprise centers, which are, so after opening another new enterprise center in the area. I’m chairman of the county enterprise fund. And that’s a fund that has buildings in most towns within County Monaghan where we provide office space and other services to companies that require locations. I am going out to the states now on Wednesday for a trade mission to see can we attract more Americans back to County Monaghan, but very involved in that industries and such.

Patrick Daly:

Tell me something that you’ve always wanted to do, whether in personal or professional life, but you’ve not done yet.

Paul Shortt:

There’s lots of things.

Patrick Daly:

That’s good that there are still a lot of things,

Paul Shortt:

But the premier golf can be a major achievement, we have a lovely golf course down here, County Wood, and it’s just on my doorstep, but it frustrates me at times that I can. But age is a problem that none of us can unfortunately stop hindering in our processes, and you end up having to suddenly realize that you’re not as young as you used to be, and you just have to take every day as it comes and hope you’ll be there at nighttime. But no, generally life is good, thank God.

Patrick Daly:

Yeah. So are you reading or listening to anything at the moment, books, podcasts, for example, that you’d recommend to listeners?

Paul Shortt:

I listen to various podcasts, audio books is when I’m out walking, I enjoy. I listen to one of recent one about Brexit and stuff like that. But I find that the audio books, I don’t have a lot of patience in reading. I prefer to listen to the audio on the podcasts.

Patrick Daly:

Yeah, it’s good. I do that as well. Quite a lot. It’s good. So where can business find out more about your different interests, your different activities? Where can they contact you? Whether it’s in the consultancy business or whether it’s more from-

Paul Shortt:

I have a LinkedIn profile there.

Patrick Daly:

Yeah, so that’s the easiest place to find you. And it’s Shortt with two T’s, isn’t it? Paul Shortt.

Paul Shortt:

Two T’s, yeah. Someone said that’s to make the short longer

Patrick Daly:

The longer short.

Paul Shortt:

Yeah. Longer short.

Patrick Daly:

Okay, Paul, well thanks very much for being here with us today. It’s been an absolute pleasure chatting with you as always.

Paul Shortt:

And thanks for the opportunity and the best wishes to you all. Thank you.

Patrick Daly:

Thank you very much, Paul.

Paul Shortt:

Good luck. Bye-bye.

Patrick Daly:

And thanks also to our listeners for tuning in again today and be aware that if you enjoyed this episode, you can find a full series of over 140 episodes of Interlinks on Spotify, Apple Podcasts, Acast, and other major podcast platforms. So until next time, keep well and stay safe.