The Sunday Herald’s Blue Chip Club has profiled some of Scotland’s finest firms. Arthur MacMillan and Darran Gardner revisit five firms to see how they’ve done since
THE Sunday Herald celebrated another year of success for small and medium- sized businesses at the Blue Chip Club Breakfast in Glasgow last week. The event, attended by more than 100 Blue Chip members and Scottish business leaders, took place at the Hilton Hotel on Thursday morning. Bob Downes, director of BT Scotland, made the keynote speech, and noted that many companies profiled in the last five years have grown into stable, wealth-generating businesses, a number of which had since become important clients of BT Scotland.
He said: “It has been great for us to support the Blue Chip Club over the past five years. [Blue Chip members] really represent the new Scotland, which is about being positive and encouraging towards business, while being socially responsible.”
Andrew Jaspan, editor of the Sunday Herald, thanked BT Scotland for its support. He added: “The Blue Chip Club has showcased many businesses that our readers would never have otherwise heard of and it has been a great success in helping forge stronger links between the Sunday Herald and the business community.”
The following five companies, all Blue Chip Club members, provide a sense of the challenges and successes of small and medium-sized companies in Scotland.
Project and funding delays have provided Ron Mitchell with his biggest business headaches over the last 12 months as he builds the reputation of the civil engineering and construction group, ERDC.
Mitchell says: “It’s the usual bureaucracy and everybody is suffering from the same problems of delayed starts linked to local authority planning consent and funding for government-sponsored schemes. We have just seen £8 million worth of work start in recent weeks after almost a year of delays.”
The Edinburgh group has also just completed an £8m building project at the Dunstaffnage Marine Laboratory in Oban and is continuing site preparation work at Glasgow’s city centre £60m City Science Park.
Mitchell says ERDC has numerous projects in the pipeline – contracts that should supplement recent wins such as the construction of an access road at the De Vere hotel complex at Loch Lomond and synthetic football pitches for an English council.
Employing almost 200, the family-owned group is pursuing projects throughout the central belt, seeking deals with its public-private spin-off company ERDC In Partnership and expanding its synthetic turf business across the UK. As a result, it is targeting 5% to 10% growth to October 2004, with revenues expected to reach £24.5m.
Expansion is very much on the agenda for one of Scotland’s most dynamic internet service providers, according to its chief executive Aydin Kurt-Elli. The Edinburgh firm recently announced plans to build a £1.2m co-location facility that will allow it to target bigger business clients and take advantage of increasing interest in disaster recovery, online back-up, as well as remote and home-working services. The facility should open in later summer, when edNET will rebrand itself to help market its services to Scottish, UK and European clients.
The last 12 months have also seen it develop its Scottish broadband ability, improve direct fibre links with America, and build its customer base in the voice-over-internet protocol (VoIP) market through its nPlusOne spin-off. Turnover for 2004 will be £3m, up from £1.7m in 2002.
With a client base that includes Aegon, Scottish Equitable, Wolfson Microelectronics and numerous Scottish SMEs, edNET’s web-development agency, Lightershade, is also winning new business.
Kurt-Elli says he is determined that edNET continues to “punch above its weight” from its Scottish base and grow organically. “We are really comfortable where we are, but I want to stretch this business and become uncomfortable again.”
CRAMMOND SELECT HOMES
Business has remained busy for Bobby Halliday, managing director of Crammond Select Homes, since the company, which specialises in converting run-down farm steadings, was profiled in the Blue Chip Club in February. Halliday, an architect by trade, started his own business in 1992 when the construction industry was at its lowest ebb.
Work has now finished on Crammond’s most recent development in Dunblane with buyers now moving in. Two industrial sites, which were given planning approval last year, are about to be converted into five mews-style houses. Halliday sees the project as a “gap-filler” until Crammond’s next steading development begins next year. He says: “I like to keep my workers busy and the only way to do this is to plan three years in advance to get around the planning system.
“Planning remains a big challenge for everyone in construction and the Bridge of Allan project is a good way of ensuring work in case the next steading development does not kick in immediately.”
The strength of the UK housebuilding market has allowed the East Kilbride-based specialist in the design and installation of integrated home technology packages for builders and developers to forge ahead with growth.
Increasingly, says co-founder and managing director Chris Stewart, developers are seeking to attract buyers by installing state-of-the-art sound and vision systems in new-builds. After only three years, Hometech can count the likes of Taylor Woodrow, Bett Homes, Bryant and Gregor Shore as clients.
The young company recorded a 2003 turnover of around £1m, Stewart is looking to double this figure in 2004. Hometech has just opened an office in St Albans to assist with a marketing push into England planned for later in 2004, and after receiving £310,000 in angel funding a year ago. It is also in discussion with its bank and other equity investors about additional funding resources.
With Hometech already partnering with East Kilbride hi-fi player Linn Products to distribute and install its quality sound systems, Stewart says he is currently looking to develop new partnerships that will allow the business to extend its audio-visual product range. Neil Howard, former finance director at William Grant & Sons, joined the team late last year.
GAS CALL SERVICES
It has been a busy start to the year for Mike Donnelly and his team at Glasgow-based Gas Call Services. The Easterhouse-based gas service and central heating maintenance provider won a four-year contract with Falkirk Council worth more than £2m in February. The company has also been retained by the Ega Housing Partnership to install central heating systems throughout Scotland for the next two years. A clutch of other contract wins have also seen the company’s numbers increase from 83 to more than 100.
Donnelly says: “The sector is extremely busy right now and we will shortly be taking on another six people to cope with demand.”
Gas Call Services is also moving to new premises at Queenslie Industrial Estate. “We have been bursting at the seams at Westwood [Business Centre] but we are doing sufficiently well that we can now move to a 7500 square foot facility. Having more people under one roof will be beneficial.”
Gas Call Services is also developing plans for more out-of-hours maintenance services for private customers and businesses.
23 May 2004