SME FOCUS — Fit-out specialist IDM is thriving by targeting upmarket clients such as Jamie Oliver
IDM is getting into hotel fit-outs. That is not too surprising: the firm has always coupled growth with diversification. What is more noteworthy is that it is going to be picky about the work that it accepts.
Garry Reynolds, director and co-founder, says: “Hotels will be our next area, but we only want to do high-quality stuff at the front end, like reception areas, cafes, bars and restaurants.”
Setting criteria for the type of work you will accept in a market you have yet to enter may sound arrogant, but Reynolds and fellow director and founder Peter O’Brien feel they have every right to be confident.
First, their business is doing well. IDM, which they set up 10 years ago, posted a 50% increase in pre-tax profit to £300,000 on turnover of £38m for the year ending 30 June 2006. Second, fit-out is presently a sellers’ market.
O’Brien says: “The market is overheated. Just 24 months ago we were chasing work, but now we don’t have to. We have a choice of what work we take on and, in some cases, we say no.”
This demand is being underpinned by the general strength of the British economy, and that policy of diversification means that IDM can pitch for work in the office, residential, retail or leisure sectors.
Finance is particularly hot at the moment: investment banks are spending millions on refurbishment after pocketing huge fees from mergers and acquisitions. The recovery of the office market is well under way and even the retail market has come out of its slump.
“Retail is coming back,” Reynolds says. “People are rebranding and they are more bullish about the market.”
We only want to do high-quality stuff at the front end
Garry Reynolds , IDM director
IDM only started pitching for retail and leisure work two years ago, but it has picked up a number of high-profile clients, including celebrity chef Jamie Oliver’s Fifteen restaurant in London and the American doughnut chain Krispy Kreme.
Recently, the company moved into healthcare and education. One project was a gaming and internet space for a north-west London school. Design ideas from the pupils were incorporated and it was built over the six-week summer break.
The booming fit-out market has undoubtedly aided them, but Reynolds and O’Brien are keen to prove that a strong economy is no guarantee of success. They mention fit-out companies that have gone into administration, including Bellwater, Curzon Interiors, Spectrum, Benson Interiors and The Pel Group.
“Others chase turnover. We chase business relationships,” says Reynolds. “Seventy-two per cent of our clients are repeat business.” O’Brien expands on this: ”Financial stability and staff quality are the two most important things for us. Our staff are our business.”
Staff numbers have shot up over the past 12 months. IDM employs 50 people – a 20% increase since last year. Its workforce is expected to expand by a further 10% this year, and it is about to rent more space in its south-east London office to accommodate the growth, but in the long-term it will have to move to bigger premises.
Although based in London, IDM’s project managers work across the country. Reynolds and O’Brien have toyed with the idea of opening a second office, but are not yet convinced it would be beneficial. “We work across the UK so if we wanted a new office where would we put it?”
The founders’ keenness to take on challenges begs the question of whether they will be pitching for Olympics work. Reynolds agrees the Olympics is a good thing but he has an ulterior motive. “It’s good because people are out chasing Olympics work and that means we can look at everything else …”
IDM won the decoration specialist category at Building’s 2005 Specialist Contractor Awards. This year’s event takes place on 21 November at the London Hilton hotel.
For more information log on to www.building.co.uk/specialistcontractorawards