Once-successful scaffolding contractor FMG slid into loss after the untimely death of its founder. Essex-born business partners Joel Ryan and Gary Stevens bought out the north London firm and gave themselves six months to turn things around. Steve Menary found out how tough measures have brought the pair fortune and a certain amount of fame
'HE'S LIKE my fourth brother, ' says Joel Ryan of his business partner Gary Stevens. His smile sparkles nearly as much as his matching earrings and he jokes that three brothers is quite enough.
'And he's like the brother I never wanted, ' Mr Stevens shoots back as the pair have their photo taken outside the Institution of Electrical Engineers on the bank of the Thames in central London.
Mr Stevens was toastmaster at Mr Ryan's recent wedding. The pair obviously get on well and that relationship is starting to yield results at the scaffold business they rescued two years ago.
Set up in 1989, Freddie Martin Group was motoring along as a scaffold subcontractor in London until its eponymous founder's untimely death from a heart attack in 2001.
Mr Martin's widow, Yvonne, had taken over FMG, which was turning over around £1.9 million a year and had 45 staff, including 37 scaffolders, but was star t ing to un ravel.
Mr Stevens says: 'It had been making money under Freddie but there was no risk management, no health and safety infrastructure and no management. Guys were taking advantage and getting into the comfort zone.
'I was approached to go and see Yvonne and she asked if I would run it. I was offered a job as general manager in February 2003 on the condition that I would get an option to buy the business.' That opt ion was impor tant on both sides as Mrs Martin wanted out and Mr Stevens wanted to be more than just an employee.
By May 2004, Mr Stevens decided he definitely wanted to buy the company and needed a partner. He approached Mr Ryan, who had been at school with his sister in Harlow, but the pair had to move fast.
After making an offer to buy the company the partners had only two weeks to get the funding together.
'I had to buy the company or she was just going to close the gates and close the company down, ' says Mr Stevens.
'It was a depleting industry company and its reputation within the industry was diluted. We had to take on a couple of liabilities that are being dealt with by the Health & Safety Executive.
FMG had a net worth of £487,000 but Mr Stevens and Mr Ryan bought the business for £250,000 with the stock comprising £223,000 of the price. The pair had to pay £200,000 up front with £50,000 deferred for a short period.
Mr Ryan says: 'We begged and borrowed to come up with the money ? loans, remortgages, that sort of thing. And that first month the business only turned over £9,600 because the acquisition was going through.' Fearing the business could go under, customers were walking away and turnover crumbled to just £1.2 million. Staff were also leaving.
The pair gave themselves six months to make FMG a success, and immediately began the revamp process.
The new owners speeded up the staff cuts and just seven of FMG's original workforce are still there.
Mr Stevens says: 'A lot of people left but we had to get rid of a lot of driftwood too. We restructured the management and brought in Ian Hearn, who had been made redundant when Bow went down but had seven years with SGB. He's very good as an administrator and contractually as he's a qualified quantity surveyor.' The workforce has since risen to 25 directly employed staff, including 16 scaffolders, but recruiting the right people was only half the problem for the new owners. A lack of paperwork meant that often the partners were left with no records of when scaffolding had been erected.
'We didn't know what to charge, ' says Mr Ryan.
The business is certainly not suffering from a lack of promotion. At 27, the ebullient Mr Ryan is 11 years younger than his partner and anything but camera shy. Having appeared in a BBC documentary, Get the Builders In, his recent wedding to impressionist and TV personality Francine Lewis was featured in OK! magazine and he is due to appear with his shirt off in the News of The World.
Mr Stevens is a bit more reticent, although he did appear in a TV advertisement for Virgin Mobile after being spotted putting up scaffold at one of the company's sites. '£750 for the day, ' says Mr Stevens. 'I couldn't believe it.' Neither started out with dreams of working in the construction industry but both businessmen want to make a go of FMG.
A new logo and company shirts have been produced to give the business a more professional look.
And though Mr Ryan's background is more in the domestic sector, he and Mr Stevens want to leave the arena of the jobbing builder behind and focus on commercial work for big contractors.
Having lost a number of clients during the dark days of its near-collapse, FMG has since landed work with big main contractors such as Kier and McNicholas Plc.
Mr Stevens says: 'We've tried to pull away from the small builder who doesn't pay you and aim for the premier league.' The photo-shoot venue of the IEE is also an important job to Mr Stevens and Mr Ryan as the £75,000 package to erect scaffold there was their first contract for another big contractor, Mitie.
As part of this drive for bigger clients, a CD Rom is available for every FMG staff member to show potential customers who they are employing.
This includes their training, jobs they have worked on in the past and health and safety accreditation, which is the pair's biggest bugbear.
Mr Stevens says: 'We spent £30,000 last year on health and safety training as it's so important, but it's completely underpoliced and the HSE are totally understaffed.' With the focus on working for bigger commercial clients, Mr Stevens and Mr Ryan have also introduced a nine-week running programme for jobs but struggle to get contractors to realise they need decent notice to take scaffold down.
Mr Ryan says: 'If they ring us up the day before and say we want the scaffold down, we might be booked up and not have the labour available.
That's why we need as much not ice as possible.' The firm's success has been a relief but the pair do not want to grow the business too much. A total turnover of £2 million a year from scaffolding is their initial aim.
Having recruited staff from collapsed scaffold giant Bow, the pair are only too aware of the dangers of getting too big.
'The bigger the monster you create, the more you have to feed it, ' says Mr Stevens.
City boy Stevens
LIKE his partner, Gary Stevens is from the Harlow area and had a roundabout route into the construction industry, leaving school in 1983 for a job in the City.
Mr Stevens says: 'I did it for two years until a friend offered me a job scaffolding. I started out as a labourer then worked my way up through the CITB qualifications.' In 1986, he joined scaffold giant SGB and spent two years working out of King's Cross in central London before moving to another scaffold group, GKN, for four years. This ended in 1992, when he moved to Lincolnshire and worked for a number of small firms, then further north on projects including the Thelwall Viaduct in Lancashire.
In 2000 Mr Stevens formed G&M Scaffolding with just £11,000 to spend on materials and labourers. Three years later he folded G&M Scaffolding to join forces with Mr Ryan and buy FMG.
The life of Ryan
JOEL Ryan realised he preferred earning a living to being a student on leaving school. Born in Harlow, Mr Ryan, who is 27, set out into the construction industry in 1994 as a roofer.
But his ambitions stretched beyond simply working as a jobbing builder. 'I realised that the only way to make money was to work for yourself and employ other people.' Starting out with a van and one labourer, he started operating as a subcontractor and moved into loft conversions and house extensions before forming his own contracting business, Platinum Construction, in 2000, which he eventually wound down to take over FMG with Mr Stevens.