Big mergers bring opportunity to small business

David Fison now runs family business Osborne – of the new pink logo -  having previously been boss of a major contractor. Mergers of the big businesses bring only opportunity for those lower down the ranks, he says.

I am watching the merger moves of the large contractors and consultants with great interest. It is what big companies do to gain market share and maximise earnings by cutting costs through combining teams, offices, etc. What that means of course is laying people off, often the most experienced and therefore most expensive– usually described in press releases as ‘creating synergies’.

But this is happening at a time when the construction industry is becoming increasingly aware that it faces major issues over resources, by which I mean people as well as materials and plant.

Various reports suggest that the industry lost 300,000 people during the recession. Another 300,000 are due to leave in very short order as the baby boomers of the 1940s hit retirement age. Replacing them will not be easy or quick.

As investment in infrastructure and construction generally ramps us – with predictions of a 10% increase in workload over two years, having enough good quality, trained people is going to be the deciding factor in what work firms have the capacity to bid for and deliver.  The anticipated synergies in those big mergers may not evolve as companies find they need to hang on to resources.

But if they don’t,  big company efficiency savings look like being to the benefit of smaller companies. Most small businesses have a longer horizon, less ambitious profit ambitions and can offer secure job opportunities for construction staff. The jobs may not be so big but we are closer to our clients, more agile, and value what individuals have to offer.

For staff, and in fact for clients, it’s a bit like choosing a restaurant. You can go to a top class hotel with formal service or the local restaurant round the corner. Both give you good food to suit your budget but with a different style. It’s just about making the choice.

Smaller businesses have a lot to offer, I believe. We are looking forward to welcoming new recruits going forward.