SME profile Derbyshire contractor resolute in face of economic downturn and OFT probe

When Wildgoose Construction was last month named by the Office of Fair Trading (OFT) as one of the 112 firms to be investigated for cover pricing, rather than retreat into its shell the firm saw the announcement as an opportunity to prove its integrity.

鈥淲e welcome the abolition of this endemic practice as it has created a clear and regulated system among contractors,鈥 says Tim Walker, managing director of the 拢40m-turnover Derbyshire-based company.

鈥淔or the past 112 years this company has had a policy of operating with integrity and honesty. There was no intention by Wildgoose to benefit unfairly at its customers鈥 expense.鈥

The practice of cover pricing had been common in the construction industry throughout the country for decades. The OFT鈥檚 investigation, which began in 2004, originated from a specific complaint made in the East Midlands, hence the inclusion of Wildgoose, which operates partly in that area.

Following the naming of the firm, John Wildgoose, the group鈥檚 chairman and great-grandson of the founder, wrote to his customers assuring them of the company鈥檚 upstanding reputation.

鈥淚t鈥檚 business as usual for us,鈥 says Walker. 鈥淭hese are tough times for the construction industry, but we鈥檝e always made sure we have a diversified portfolio of work, which means we are not susceptible to any downturn in one specific area.鈥

One sector of the industry that has suffered a particular collapse is the development of new homes. Recent figures show reservation levels have plummeted by two-thirds in recent weeks as housebuilders struggle to find buyers. Housing accounts for 10% of Wildgoose鈥檚 turnover. It has also been hit by market conditions and has currently suspended the development of any new homes.

鈥淲e鈥檙e on the lookout for new opportunities,鈥 says Walker, 鈥渂ut asking prices for land remain stubbornly high. Sellers are not in touch with reality and until we can buy land at realistic prices we鈥檙e not going to expose ourselves.鈥

We welcome the abolition of this endemic practice as it has created a clear and regulated system among contractors

Tim Walker, Wildgoose

Fortunately for Wildgoose, its remaining areas of expertise continue to perform well and the company is expected to nearly double turnover for the current year to almost 拢40m.

鈥淲e operate in a diverse market and that鈥檚 our strength,鈥 says Walker. 鈥淲e鈥檙e currently working on 18 projects and it is my job to ensure we always operate at this level, so as one job nears completion, we replace it with new work. Enquiries have slowed, but we鈥檝e still got a strong order book and we鈥檒l be working at capacity for as far as I can see into the future.鈥

From industrial sheds and historic building renovations to public sector work in the health and education arenas, Wildgoose feels it is a small firm well set to take on the economic perils that have already led to several casualties in the construction world.

鈥淭he credit crunch is having an effect on the industry, but I鈥檓 looking ahead to the summer and we鈥檙e more than confident our profitability will not be affected,鈥 says Walker.

Walker, who claims not to be a political animal, knows on which side his bread is buttered. Many of the projects, which range in value from 拢1m to 拢7m, come from the public sector and the group has a number of framework partnering arrangements with the likes of Derbyshire council, Rotherham council and Nottingham community housing association.

鈥淚 admit business under a Labour government is good for us,鈥 says Walker. 鈥淟abour invests in education and health, and we benefit from that a great deal.鈥

So, does he believe Gordon Brown鈥檚 current leadership problems will resolve themselves in time for the next election in a couple of years? 鈥淚 hope so 鈥 Labour is certainly better for us.鈥

Wildgoose construction

Founded: 1896
Estimated turnover 2007/08: 拢40m (35% education, 35%, health, 20% industrial/ commercial and 10% housing)
HQ: Ashover, Chesterfield
Employees: 90

Projects

  • 拢5m Care home, Belper, Milford Care Homes
  • 拢4m School, Ilkeston, Derbyshire council
  • 拢4m Mortuary, Bradford council
  • 拢3.5m Incubation centre, Rotherham council
  • 拢3m Medical centre, Goole, Yorkshire, GPI
  • 拢2m Boutique hotel, Finesse Hotels, Derby