Dips send Stewart back to core business

Lorne Stewart, Kyle Stewart and now Maxwell Stewart. The Stewart family name has certainly made its mark on the UK construction industry over the past 50 years or so, and the new generation also seems to be thriving.

Robert Stewart is the grandson of Leslie Stewart, founder of the two old firms. And despite a love of cricket, motor racing and Arsenal FC, he says it is the construction industry which runs in his blood.

From his swish new offices in Rickmansworth, Hertfordshire, Stewart is now running his firm of building services engineers after establishing the firm with his partner John Sheehy at the end of 1991.

At that time he had just completed three years out of the industry as a condition of the sale of Lorne Stewart to BET by his father, Ian.

Throughout those years, the young Stewart went into corporate entertaining and spent his days at sports events and playing cricket. It was a boom time for such events, but when the bottom fell out of the corporate entertainment market in the early 90s Stewart was raring to get back into construction.

He called the new firm Maxwell Stewart, taking his middle name, and immediately the firm became the subject of investigation following the death of Robert Maxwell. Having come through that, the firm looked for its first big break and got it with a contract for Mace in 1992. Now the firm has a œ4.5 million turnover.

But in recent months Stewart has started to see signs of a 'blip' in the market, a blip that is throwing up a fresh challenge for the developing firm.

'There is no doubt that the interest rate rises have caused a dip in the market,' said Stewart. 'We are being given information about jobs and then finding that the projects are now awaiting funding.'

Last year things were going very well for the firm and work was flowing in. The company had been keen to stick to an established strategy, but in all the excitement Stewart admits they took their eye off the ball and created some problems for themselves.

'We had pretty much decided to avoid working for the main contractors and instead try to get work as a nominated contractor for project management firms,' said Stewart. 'But to maintain our level of work we broke our own rules and started bidding for work through main contractors.'

The main problem they found with this is their success rate in tendering plummeted. 'You find yourselves being one of three firms bidding to get the subcontract for a contractor who is one of five bidding for the main contract,' said Stewart. 'That is a one in fifteen chance, and sometimes it's higher.'

Stewart did not like the situation and took a grip again, cutting back on staff and going back to what he calls his 'core business' even after just two years of operation.

But he accepts it is tough. 'The industry is in a terrible state. Firms are still putting in minus figures for overheads and profits, and clients are still taking the cheapest.'

Stewart dreams of an ideal world when he has 10 or so clients that he knows and trusts and who know and trust his firm.

'We are unlikely to be the cheapest and we don't make claims on contracts. We want to work for clients that recognise the value in that,' he said.