AN electronics firm’s small is beautiful philosophy has seen it secure a £3m a year deal with a renowned hi-fi manufacturer.

Connor Solutions believed a focus on quality rather than quantity has helped it expand in a fiercely competitive market and attract customers of the calibre of Arcam.

The firm, based in Houghton-le-Spring, Wearside, will provide electronics assembly services for Arcam, which designs and manufactures high-end hi-fi and home cinema equipment from its base just outside Cambridge.

Connor, which was set up ten years ago and employs about 160 people, specialises in providing low to medium volume electronic manufacturing services (EMS) to companies in the UK and Ireland.

Having just obtained an aerospace industry quality standard, the company is hoping to make inroads in the defence market, to add to clients in the industrial, audio/visual and medical fields.

Connor’s finance director Phil Hall said: “Our aim is not to be the biggest EMS operator in the market, but to be recognised as providing the best equipment and best customer service, characteristics which are key in boosting our profitability.”

Having spent time reviewing the business in the wake of the economic downturn, Mr Hall said the firm was well placed to take advantage of opportunities as the upturn gathered pace.

He said: “The business has evolved and grown successfully over the years, but last year, we could see the difficulties that the coming recession would cause all parts of the commercial world, including our customer base, so took the time to review our operations and plan how we would take the business forward.

“With the recovery now on the way, we can see a number of opportunities opening up, such as the new Arcam contract, and we are in great shape to take advantage of them.”

He believed that the aerospace accreditation, which defence firms demand prior to doing business, would also open up important markets.

He said: “We’ve long recognised that our expertise would be well received in the defence and aerospace markets, and having now got the quality accreditation that the sectors’ leading companies demand that their suppliers have, we believe we will be able to swiftly develop new income streams based on the industry relationships we’re already building.”

In 2003, the company received investment capital from NEL Fund Managers, which provides private and public finance to small and medium North-East businesses.

Further investments followed in 2004 and then in January this year, as a large part of a wider investment package, and it has maintained a presence on Connor’s board of non-executive directors.

Mr Hall added: “NEL has made a truly tangible contribution to our success over the years. It has shown a real appetite for our business and the people behind it, and has been able to provide very valuable guidance and advice through the non-executive position on our board.”

Yvonne Gale, portfolio manager at NEL Fund Managers, said: “Connor Solutions’ success is based on a clear commitment to quality, both in terms of the components they provide and the service they offer.”