Shepherd Construction business director Gary Edwards believes the firm’s direct labour force leaves it primed to benefit from a switch to more refurbishment work after this year’s general election.
The company expects major new build projects will be in short supply as the government attempts to reduce the national debt.
But Mr Edwards said: “We are in a good position for this. For many years we have carried our own trades people so we have the ability to carry out refurbishment work as well as new build.
“We have experience in virtually every market sector other than housebuilding and can flex the business into the emerging market, which is refurbishment.
“We have maintained a labour force and I believe this will give us a competitive advantage over the next three years,” he said.
Mr Edwards insists that the contractor remains a design-and-build contractor at its heart. “That is what we are good at and what sits at the heart of our strategy. We have just been shortlisted for the Stockton BSF
scheme, which is all design and build,” he said.
Shepherd Construction recorded turnover of £326.9 million in the 12 months to 30 June 2009, down very slightly from £329.2m the previous year.
The firm employed an average of 908 people during the 12 months of its last accounts, down from 961 in the previous year. Now it is aiming to use its employees to bounce back from a difficult period and reach £400m
turnover within three years.
Mr Edwards told Construction News: “Like a lot of companies we have had to restructure the business in the past 12 months and as a consequence this has had an impact on turnover.
“But we now have a three-year strategic growth strategy and we are starting to head towards a target of being a £400m organisation within three years. Our order book for 2010/11 is ahead of the target that the board set.”
Despite expecting cuts in public spending, he said: “In 09/10 we will produce better profit than 08/9.
“We have factored into our plans the impact of public sector spending cuts. Construction will have to be cut. There will be fewer opportunities, but whoever comes to power, they cannot turn the tap off. There will be more smaller jobs.”
Mr Edwards added that a need to meet ever-increasing sustainability targets would see a growing market for retrofitting existing buildings.
“We will see developers looking to get the most from their assets. There will be less new-build work and more refurbishment. The sustainability agenda will see legislation that drives refurbishment work.”
Shepherd Construction last year made it on to the hotly contested £4bn academies ‘super-framework’ as well as joining the Medicinq consortium that is shortlisted for the similarly valued ProCure 21+ agreement.
In these sectors it is therefore competing with industry giants including Balfour Beatty, Vinci and Carillion. But Mr Edwards insisted Shepherd Construction remained essentially a regional contractor.
He said: “We are a regional, geographically led business and have offices throughout the UK. We believe the success of the business will be predicated by micro markets and customer relationships.
“We need to be involved in frameworks, which are ultimately delivered in the regions anyway.”
Shepherd is showing a keen interest in the academies framework. “We are starting to put preliminary invitations to tender forward for the initial academies jobs, and intend to put these forward on all the first six schemes.”