Clarke heads up the division with the enthusiasm of a ten-year old allowed on the footplate of an InterCity Express. Headhunted from Shepherd Engineering Services about a year ago, Clarke wanted a challenge and he got it. "Originally I was to work from a regional office in London but the opportunities are so vast that I realised that a stand-alone business was needed."
Nationwide work meant that Manchester was chosen as the location for ABB Steward's national rail centre and in May of this year Clarke and his staff moved into offices at 111 Piccadilly, Manchester. The very same building as Railtrack Project Delivery, in fact.
"Yes, having the client in the same building is useful. You get to meet these people, chat and get to know them. It's a good way to do business," says Clarke. "But, more importantly, Manchester is the perfect location. Easy for the Midlands, North and South. And, with regional rail offices in London and Glasgow we have a network which runs down the spine of the country.
"I have been brought in to build up the rail work that ABB Steward is doing m&e wise, and to expand into the rail business itself." This means moving into trackside works. A specialist sector which Clarke champions as the way forward. "The trackside work is of a much bigger value than station m&e works. You can get a £25 million overhead line project which is small in the overall scale of overhead line work. A £25 million m&e contract is a big, big job. I'm taking ABB Steward Rail Services into the trackside market."
Clarke is onto a good thing. Since privatisation the rail providers have been constantly pressured to improve the network and service. Railtrack is currently in the process of spending a gargantuan £27 billion on improving the network.
Bidding for huge contracts can be risky though. "You can only bid for a few £100 million contracts before you go out of business. You've got to win some of them, sharpish.
Our rail projects pulled in £4 million turnover last year and £14 million this year. I am looking for over £30 million next year
"To say that this market is not as cut-throat as typical m&e work would probably be the wrong way of putting it. The competition is less but you've got to be very good to be successful."
Profit margins too are an incentive. M&E work and construction in general are blighted by ridiculously tight pricing with virtually no profit. Railway works are different. Clarke says: "This [trackside work] is where the margins are higher. You are looking at 12½ to 15% gross margin but there is a good deal of risk. You need solid backing behind you and I've got that with ABB. We are not tinkering. We are specialists in this kind of work."
With this sentiment in mind, Clarke continues: "All of the big players are in the market now but they are tackling it in different ways. There are new entrants and people falling by the wayside every day. This is not what Railtrack wants. It wants to work with a few dedicated companies on an open book basis."
This is what Clarke and company aim to provide. The expertise that he has brought in or trained up can now offer, as he puts it, "a one-stop-shop company", that can tender for and complete m&e work, lay trenches, install cables and make-off connections to the signals without subbing out elements of the work. This is where the money is. "Our rail projects pulled in £4 million turnover last year and £14 million this year. I am looking for over £30 million next year", states Clarke.
Keeping up this momentum and growth could be difficult but Clarke is not phased. "We are starting to work direct for Railtrack now. We are working for the train operators and looking to use innovation.
"ABB is a forward-thinking company. We have already shown that through value engineering we can save the client money. We are bringing our project management skills to the fore, skills that the out-and-out rail companies don't have.
Source
Electrical and Mechanical Contractor
