It is nine and a half years ago since I wrote an article that predicted that we were heading towards a two-tier demolition industry. The UK demolition sector was still mired in a prolonged economic recession that had claimed numerous high-profile victims including Controlled Group. At the same time, businesses were suffering from escalating equipment, fuel and insurance costs.
There would come a day, I suggested, when the industry would be split along the lines of the haves and the have-nots.
Even though that original article raised the hackles of many, I stand by its basic premise. However, I now believe that while we are now seeing that two-tier system becoming a reality, the division is not along the lines of the haves and the have-nots.
Rather, it is along the lines of the wills and the will-nots and – in some instances – the cans and the can-nots.
On Friday last week, we closed our survey that looked at the sub-contracting of demolition works by “elite-level” demolition firms to “non-elite” level companies. (You can see the final results in a video below).
While the results came as no real surprise (well over three quarters of respondents agreeing that work should not be sub-contracted; and that CSCS card carriers should not be carrying out the work of CCDO operatives) it was the debate that the survey raised that was most illuminating.
Many suggested that some of the largest and best-known demolition companies in the UK had become so big, top-heavy and bloated that it was now economically impossible for them to carry out some of the work they had won themselves. Many also suggested that some companies had grown increasingly unwilling to take on the financial, logistical and physical risks associated with demolition and were now content with farming out unfavourable work and merely taking a cut.
Several suggested that we were entering the age of the demolition broker – Companies with highly-experienced and successful bid and tender teams hoovering up work with absolutely no intention of actually carrying out that work directly.
It is easy to understand the appeal of this approach – It allows medium sized companies to become large companies without taking on the hassle of additional employment and equipment. It allows large companies to become super-large while maintaining a manageable direct cost base. And, all the while, the industry’s smaller companies enjoy regular work, even though they may not enjoy all the money arising from that work.
But what does all this mean for the actual quality of the industry going forward? What does it mean for initiatives like the NFDC’s Site Audit Scheme if the company claiming accredited status is not actually doing the work? What does it mean for systems like the CCDO scheme if work won on the basis of CCDO qualifications is carried out by CSCS operatives while the client is looking the other way? Surely it renders meaningless standards such as ISO is tucked up safely in an office somewhere while a no- ISO-accredited company is carrying out the work while flying the ISO firm’s colours.
Does any of this matter? Well, it should.
It SHOULD matter to clients that have entrusted their demolition work to an elite contractor. Imagine buying a Prada jumper for £800 only to find it is a Primark jumper with a Prada label. It SHOULD matter to the smaller demolition firms that are expected to survive on the crumbs from the table of those above them in the industry pecking order. It SHOULD matter to the heads of those elite firms that have spent years and even decades honing their company’s reputation only to entrust their hard-earned work to the lowest bidder from among a rag-tag army of less qualified sub-contractors.
And it most assuredly WILL matter when something goes truly awry. We have already seen several incidents on sites “operated” by elite firms but where the work was being carried out by a third-party firm.
Thankfully, to date, none of these have involved physical injury or – worse – a fatality. But, sooner or later, it WILL happen. It is inevitable.
And when it does, both tiers of this house of cards will fall.