This is the last Wise Up Wednesday this year so let me start by wishing you, your family and your team a very Merry Christmas.
As Christmas comes around and the end of 2016 approaches, this week’s Wise Up Wednesday takes a quick look back at some of the year’s key issues for Specialist Contractors, and casts a glance forward to 2017.
Will it be a better year for you and your company?
First the Bad News From 2016
Several high-profile administrations along with wider market uncertainty were a timely reminder that bad deals can have catastrophic consequences.
In the summer the £80million turnover M&E contractor EIC went down with the loss of over 400 jobs, and its sudden collapse left many specialists shocked that the administration came without the usual warning signs of cashflow problems.
Concrete frame specialist Dunne Group, swiftly followed after reporting severe cashflow pressures. And in August administrators were appointed at Cardy Construction, who were later later found to owe its creditors £18million.
The autumn was no better, and in September Leeds-based Contractor Bay Construct went into administration after reporting “serious financial difficulties” due to a dispute on its Cumberland Hotel development. And heritage specialist William Anelay, logistics firm Elliott Thomas Group and ductwork contractor Galloway Group, soon followed.
The roll-call of company failures in 2016 is pretty stark.
What Does The Future Hold?
The longer-term impact of the Brexit vote and the recent slowdown in activity suggested by the Office for National Statistics are not yet fully clear.
“The construction sector is the first to show signs of distress when the tap of new developments is tightened”
Glyn Mummery, partner at business advisory firm FRP Advisory, says this could be a sign that insolvencies in the industry are set to rise.
“Overall corporate insolvencies remain at historic lows, but construction insolvencies are back on the increase,” he says. “The industry acts as a canary for the economy with the construction sector the first to show signs of distress when the [flow] of new developments is tightened.”
As SMEs You Are Most At Risk
“SMEs are the ones who are particularly vulnerable, especially if they’re over-geared in the first place” says Begbies Traynor partner Julie Palmer.
It’s not the larger firms that are hit by either slowing development pipelines or problem jobs, as they can maintain much larger cash reserves and the land-bank to manage cash-flow more effectively.
“The middle players and those at the lower end of the market are the ones who are particularly vulnerable – especially if they’re over-geared in the first place,” she says. “[It could be] a couple of contracts where they get it wrong, either in terms of margins or the classic mistake of buying turnover just to keep things moving forward.”
And in a more uncertain environment, managing contracts and cashflow effectively is becoming more important than ever – particularly with a devalued pound to contend with, Mr Mummery adds.
On a Brighter Note…
Although much of 2016 has been plagued by negative news StreetwiseSubbie and our Buddies have had a great year!
We’ve helped our Buddies, both old friends and new faces, to protect and grow their businesses throughout 2016, working all over the UK, and helping all trades and specialisms.
Our buddies range in size from those turning over less than £0.5million to firms in the £30million category and above.
Whatever their size or specialisation, all our Buddies enjoy our unique cost effective support service that connects them up with our independent experts in every specialism they need to support their business. And our Consultants have been particularly busy solving payment and commercial problems, and recovered literally £millions for our Buddies.
Our Construction Week Build Show Christmas Treat
Our stand at the 2016 Build Show was buzzing with Specialist Contractors talking to us about their business problems and getting helpful advice from our Consultants.
And at the show we had a cracking offer which proved very popular with our visitors. So as a very special Christmas treat we have brought that deal back until the end of December 2016.
So, if you want to get your hands on £2,000 worth of manuals, have our Consultants ready and waiting to help you (with 2 hours of their time free every month), and enjoy the peace of mind of knowing that your commercial and contractual interests are being protected, and that your payment problems can get solved cost effectively.
And that you can get your Gold Buddy Membership package at a 70% discount for the first 3 months then you should treat yourself now, because when you join as a Gold Buddy your benefits include as a minimum:
# Initial implementation session with our Consultants [contractual and commercial, sales and marketing and health and safety]
# Report identifying ways in which to improve your business
# Free Insurance audit.
# 2 x 1 hour free Consultancy every single month to use as you choose and worth more than your monthly subscription!
# 2 x Resource Manuals written by our experts to provide knowledge and guidance in commercial and contractual, and business development
# Regular updates with additional sections.
# Access to our websites knowledge bank of information
# Free Subcontracting Today – the Specialist Contractors news letter
# Unlimited access by phone and email to a wide variety of experts for whatever it is your business needs.
# exclusive discount on a truly amazing access all areas Glenigan sales lead package.
If all this wasn’t enough we provide in-house and external training sessions, and hold regular conferences and seminars, giving your team opportunities to get together and discuss real business issues and hear from our experts about all sorts of practical solutions.
If Streetwise sounds like something that would benefit your business and would like to grab our Special Christmas Offer, you can find details here:
Alternatively if you would like to talk it over, please give us a call today on 01773 712116 or email us at email@example.com.
Have A Great Christmas
I sincerely hope that you have a fantastic Christmas, but if you have any kind of business problem, and want some good honest no-nonsense advice then please don’t hesitate to call me on 01773 712116 or email me at firstname.lastname@example.org.
We look forward to keeping you up to date and helping you to resolve all your business problems in the New Year.