Thank you all for your replies.
There is no manual penalty in play - checked with request to Google via Webmaster Tools.
The company has claimed its Local+ page.
My thoughts are that it is Penguin. The majority of links back to the website are retailers that sell the products of my client, so these links are out of my control unfortunately.
All the links i have setup to my clients website are setup like Scott suggests.
Bit stuck really : /
Is there anything else you guys would suggest?
Thanks,