Top tyres for the wheels of fortune
DMACK’s planet champion rally car treads are about to turn into a buyer brand 
At the Wales Rally GB final November, 4 out of the 5 autos that raced to victory, taking their location in the Planet Rally Championships, have been kitted out with DMACK tyres.
The Carlisle-based mostly firm founded in 2007 by Dick Cormack is rapidly turning into a single of the most successful brand names in substantial-overall performance tyres, with exclusive contracts to provide motorsport clients across the world.
Cormack, a former rally driver and mechanic for Pirelli, launched his firm right after creating a radical new tyre. “After twelve years at Pirelli I had my eureka second,” he says. “Now, my tyres are beating Michelin, Hankook and Pirelli at the rallies. It’s extremely satisfying.”
Cormack is a keen strategist. He made the decision to focus on the rally sector. After the DMACK identify became synonymous with good quality tyres in the motorsport industry, he set his sights on the mainstream market.
“Motorsport is the test bed for normal road vehicles,” he says. “And once rally fans see DMACK tyres winning races, they commence wanting them on their automobiles.”
In June this 12 months, DMACK tyres will go on sale up and down the country. The firm is launching a nationwide marketing campaign to promote itself as a consumer brand.
“We’re calling it Drive DMACK,” says Cormack. “Wholesalers want to stock branded tyres because it increases their margin. Consumers can go for the budget tyres, or they can go for the ones that win trophies.”
DMACK also supplies a amount of automotive producers, such as Swift Caravans. “The light truck market place is huge and we’re aiming to be a essential supplier by 2015,” adds Cormack.
DMACK’s motorsport roots also aided the company locate a manufacturing spouse in China. “Back in 2009, when I first went to China, no 1 above there was generating motorsport tyres,” explains Cormack. “But everyone wished to make them, since it gave them credibility. We’re speaking about an very higher technical level.”
When Cormack signed a deal with Yongtai, the Chinese tyre manufacturer was ready to consider on all the upfront costs in order to companion with DMACK and obtain accessibility to the firm’s extremely prized intellectual residence (IP).
“They bought all the raw supplies, which I couldn’t afford when I started the business,” says Cormack. “We have invested in IP and mould design and Yongtai handles the manufacturing. It is enabled us to grow very speedily.”
Getting a modest, independent business is an asset in the motorsport business. “The large corporate companies are slow,” he says. “I realized that initial hand. They could have the assets but we’re a lot more rapidly. We use cutting edge materials and we constantly have new goods under development. The Chinese are specifically very good at coming up with new specs.
“That’s how we are ready to compete with Michelin, with its €15bn turnover, when we’re just £5m proper now. At the start off, it was almost a joke. It was a complete David and Goliath scenario. But now they have come to respect us, due to the fact we’ve beaten them at rallies.”
Despite its rapid growth, DMACK has usually struggled to increase sufficient growth capital from the financial institution. In 2010, Cormack used Clifton Asset Management to unlock £75,000 from his pension in order to fund development.
Last yr, the firm secured £3.5m from the venture capital company Maven in exchange for 30pc equity. “Despite our massive development potential, at the time turnover was only £4.6m,” explained Cormack. “The bank explained the investment turnover ratio was as well higher.”
This income injection will enable DMACK to target on profitable new worldwide possibilities. “South America will almost certainly be our greatest marketplace, but it is this kind of a massive broad globe out there,” explained Cormack. “If 1 economy goes cold, we can focus on one more. Simply because of the related tyre specifications across the planet, you are never stuck in a single market place.
Turnover this year is forecast to hit £9.2m and Cormack predicts revenues of £16.2m in 2015 and £26.5m by 2016.
He claims that he can spot rising economies prior to other industry analysts simply because of DMACK’s distinct niche.
“A great deal of motorsport consumers are wealthy people,” he explains. “You can search at motorsport patterns close to the globe to see which nations are doing nicely. If you see decrease entries in 1 country, you know it is not undertaking so effectively. The more rallies, the more disposable funds. For example, from a tyre point of view, the financial resurgence in the Uk started a even though ago.”
The rally industry runs for 12 months a year, which assures a regular stream of revenue at DMACK.
“There are no peaks and troughs,” says Cormack. “We presently provide motorsport tyres to far more than 70 countries and we’re the management tyre in South America.
“We’ve gone from an unknown brand to a worldwide brand that everyone recognises in motorsport,” he extra. “It feels great to be taken significantly.”