Don Mitchell's The Parliamentary Review Article

see original article here

DM Steelworks Limited are a steel manufacturing and architectural metalwork company located on the Braintree Industrial Estate in Ruislip, Middlesex. They have a proven successful portfolio of work, and a workforce of 39. Although they started trading in 1995 as a small fabrication business, they were incorporated in 2002, and have grown and gone from success to success since then. Managing director and the company's namesake, Don Mitchell, discusses how they have achieved this.

From our humble beginnings, working with just a team of three from a garage in Harrow, we are now an established company based in Ruislip. We have a certificate of conformity of factory production control, and a 24,000 square foot factory and office. We currently employ 39 people, which includes a CAD team, surveyors and administrators, managed by the hands-on director and operations director. One of the greatest examples of our work can be seen at the flagship Abercrombie & Fitch retail store in Hamburg. Here, we assisted in the design of and then produced and installed a completely bespoke staircase and balustrade. Alongside this, we have completed a variety of government projects and worked across most market sectors, including healthcare, leisure, commercial and residential.

A five-year plan and our impact

For the next five years, with our previous accolades in mind, we have set out a plan focusing on three key areas, which are the foundation upon which future work is targeted. These are as follows:

• Increasing the turnover and growth of our business
• Development and improvement of our in-house design team's capabilities
• Expanding our customer base while also maintaining good relationships with current clients.

To deliver on these three areas, we operate an 'open door policy' with all DM Steelworks employees, to encourage healthy debate and communication on all matters. We have trained and developed six apprentices, which will hopefully contribute to our future improvement, and have concentrated heavily on maintaining long-standing beneficial relationships with a number of clients. This has resulted in repeat business across the board.

Skill shortage

There is a skill shortage in the construction industry, particularly in the midlands and the south, where so few young people have the necessary skills as a result of the lack of appropriate training or education. This needs to be improved through the schooling system, and moved forward into training colleges and industry apprenticeships. This has been the situation for several years, as when companies ceased providing apprenticeships or training schemes, the quantity and quality of young people entering the construction industry was thus reduced.

High-speed broadband

The recent introduction of high- speed broadband has been ultimately sporadic. As an example, the infrastructure capabilities for such a service have been installed along the main road, but our industrial estate is at the end of a cul-de-sac. The necessary works to enable access for both our premises and other companies on the estate have not been provided.

This has had a major effect on our business; large quantities of information, often receipt of initial tender data, drawings or production information, are received or need to be sent electronically. The available upload and download speeds restrict the ability to either receive or transmit information, which severely impacts the efficiency of our business.

Brexit

The decision to leave the European Union has had a demonstrable effect on the industry; clients are delaying or cancelling projects until Brexit and its effects are clearer. For example, we were employed to carry out works on two adjacent buildings, naturally completing one before another. The project on the first building was completed in a timely and efficient manner; enabling works were then being carried out on the second building. It was, however, subsequently cancelled. To date, no further works have been completed, leaving one complete building adjacent to another that we’ve not worked on whatsoever. From discussion within the industry, it appears to us a lot of construction projects are being delayed due to European uncertainty.

Over the last few years, the industry has benefited from skilled European labour, with workers arriving in the UK and supplementing the country's workforce. With the withdrawal from the EU taking place shortly, the flow of skilled workers entering the UK has diminished noticeably, and those in the UK are returning home. We anticipate the labour shortage will soon be worse than before, as a result.

Cash flow and productivity

Regular cash flow is particularly important for SMEs like ourselves. Larger companies sometimes impose payment terms of 45 to 60 days from date of agreed invoice, which often takes a while to agree as a result of stipulated valuation rules that calculate amounts due. As most supplier’s terms are 30 days from invoice, this can result in cash flow difficulties; payments are sometimes made to suppliers in advance of receipt from clients. In addition, some larger companies still make payments far later than the agreed payment terms, thereby stretching cash flow resources further.

An associated effect we have seen when it comes to late payments is the loss of confidence should additional investment be required to continue with the contracted works or further project work. If payments were made sooner, this would boost productivity through an increase in confidence and trust across the board, all the while preventing cash flow issues.

Retention

Retention also affects cash flow, particularly where we have little or no knowledge as to when these are due to be released, whether they might be either practical or final completion of any given project. A considerable amount of time is spent chasing retention when we think it may be due. Our works are generally made during the early stages of a product, and as such, we can only estimate when we believe retentions might be due. Main contractors do not release these payments of their own accord.

These retention funds have no protection, and should a client or contractor either withhold them or cease trading, it is somewhere between difficult and impossible to claim the money owed.

The future

We do have a lot of issues to contend with in the modern construction industry, but we are nonetheless confident that our inspired five-year plan will provide us with an apt foundation for future success. Our open-door policy, excellent employees and further investment in the company's future through placement of apprentices will, we feel, lead us to a further period of recognised prosperity within a tumultuousindustry.