J Warren Consulting Ltd - a look at the business, and the person, in the first year of operation and asperations for the future ...
The first year of self-employment:
Since starting my career in the construction industry, and more specifically, as a quantity surveyor and commercial consultant, I’ve always known I’ve wanted to be self-employed and create a consultancy business. This year I’ve taken that first step and I think it’s important to reflect on this first year in business. Not only to share my story but to help me understand what I’ve done as well as help me plan what’s next. It may be a slow road to progression but the results for my clients hopefully speak for themselves.
The construction industry is full of people who are self-employed. I’m sure I remember reading somewhere that nearly 40% of the workforce is self-employed. This figure is made up of everything from your local electrician to the owner of large consultancies. I fit, most certainly, at the bottom end of that spectrum at the moment but with a benefit of working for some big names in the industry.
Starting my own business has been something I've always aspired to and it has genuinely been a simple process so far. It's been eye-opening and I've learned a few new skills along the way, mostly it's a shift in mentality and a shift in perception.
However, I would still consider myself a commercial consultant, a quantity surveyor and lastly a director of a business. That is a mentality I would like to change over the coming years.
My far far background:
In review of my first year of owning my own business, it is probably worth considering how I ended up here in the first place.
I’ve always been drawn to the idea of being self-employed and I think that stems from growing up in an environment which encouraged self-belief and independence. I watched my parents run their own small businesses. I can't say I remember it in any detail or that there is a standout moment that triggered my interest. Certainly, in hindsight, I see that my mum has operated a child's daycare and in recent years a domicile home care service and similarly my step-dad had a plastering firm. It’s risky, there’s no doubt about it, and you are your own maker, to coin a phrase or two.
From as young as, I’d say 12 or 13, I was “working” in the plastering trade on the weekends and school holidays. In reality, I was probably a hindrance and caused him grief for having a child on a building site but I guess times were different then. At about 16 I got my first after-school job at a donut shop, which I eventually got sacked from for selling myself scratch cards, but that's another story. Fast forward a couple years and by the time I was 17-18, I was a halfway competent plasterer, juggling school, sport and another job at a petrol station.
Truth-be-told, I don’t think I’ve ever been able to slow down, I like a full plate. This is still reflective of where I am now in my career. My first year of operating my own business, even as small as it is, has been coupled with undertaking an MSc in Construction Law, working away from home with a key client on a full-time basis and buying & fixing up a property with my partner (our first one together!).
By now maybe your heads spinning but I guess the bottom line is, I haven’t shied away from challenge or inconveniences in replace of an easy life.
When an ex-boss and friend of mine who works for Mott MacDonald was in touch in summer 2017 with an opportunity to work with a leading contractor, I saw this as a perfect opportunity to angle a self-employed role with a big named client.
When I was in discussion with my ex-boss cum agent I was actually working in Saudi Arabia at the time. I was on a fixed term contract with SA Kentz (SNC Lavalin) working on a massive scheme. One that could have led to a number of years work. We were building hundreds of kilometers of natural gas pipelines as well as a number of initial processing plants and a warehousing city. It was as close to the Billion dollar mark then I've ever worked on before. However it has a significant downside, I was 1,200km away from any major city in the northeast region of Saudi. Incredible experience but was happy enough to walk away!
After a bit of negotiation with Mott MacDonald’s, we finally settled terms and introductions where made which seemed like a good fit for all of us.
At that point, it was time to set up a business in time for my first day of consulting, all the while living in the desert with less than ideal internet connectivity. I'm not one to stress or worry about things and I find a simple list can describe even a complex activity, for example, the steps I took to start the business:
A few email and broken phone calls later and I was a fully-fledged director of a company. It was a huge step for me.
My so dubbed agent has secured me a big win with a company called tRIIO. tRIIO is an unincorporated joint venture between Skanska and Morrison's, two huge names in the construction industry. tRIIO have been working on an 8-year framework contract with Cadent Gas (ex National Grid distribution) to replace and maintain low and medium pressure assets in London and East of England. tRIIO are now 6 years into the framework and continue to have a significant programme of works.
My year of projects:
With tRIIO, I was appointed as the lead commercial on a specialist diversions portfolio and we had some significant challenges to get the portfolio moving. Initially, it was envisaged to be about a dozen large diameter projects in central London. Through varying stages of value engineering, we have reduced that to about 5 major work streams split over multiple phases.
The team and I took a no more than a napkin sketch concept from the client and went through the whole life cycle of a project. We went through a concept design, detailed design, planning, consultations, 3rd party reviews, tendering, construction and post completion settlements.
As the first year has concluded and I look back at some of the numbers I can see that the portfolio has spent over £15m and I proudly state that I have maintained a solid balance sheet with that fund. One of the individual schemes was in excess of 25% margin which is good for anyone’s money.
(Interested in finding out if I can help you do the same? I have a range of packages to help your project at all stages. Contact me for your free consultation here.)
All of the about was just within one portfolio. I was also leading on a single complex project for a different division of tRIIO which was a further £8m. I’ll save this project for another day but it has come up against some of the biggest and interesting contentious issues I’ve personally seen so far in my career.
My year in business:
As a business I’ve been operating safely throughout this year, I’ve made no strides in expansion. I’ve played it safe. But I have had my hands full with the project work!
I have been fortunate enough to personally recover against 2,133 chargeable man-hours. I’ve had 23 days off work, including the bank holidays, in 12 months.
As a comparison a standard 37.5 hour per week employee would work about 1,725 hours in a year. That means I’ve had nearly 23% more hours than a standard employee and I would like to think that extra time has been productive and worthwhile.
I’ve spent 156 nights away from home, that’s on average 3 per week. Bearing in mind that this is purely due to the fact that my projects are based in London and I’m in a little town in Cheshire. It’s just not convenient enough for commuting. This statistic in itself had been the most challenging aspect for me.
It’s funny, in reflection, at the time you don’t really think anything of it. You work until the works done for the day and if you need to be in London at 8am the next day, then you have to travel down the night before. There’s no other realistic and safe alternative.
My dedication to my project this year has actually allowed my business to reach a turnover of just over the six figures mark. This is astonishing from a personal point of view. The shameful thing is I haven’t seen most of this! Living away from home half the time has quickly eaten into the reserves and London is very expensive.
What I've learned:
Truth-be-told being a business owner hasn’t been the hardest thing for me this year. I’ve not got a horror story of not being paid by clients; I didn’t get caught out by the insolvency of a client. I don’t believe I’ve had to overcome adversity, I needed no legal assistance. I haven’t had to invest thousands in market strategies or advertisements, I haven’t needed to.
My biggest lessons:
Living away from home half the time: is very challenging. Any work-life balance you intended to have goes right out the window. When you're away from your loved ones, you never really feel like you've got the ability to unwind after a hard day. There's no, oh let's eat tea, walk the dog and relax for the night. It's more; I’ll work late, eat, sleep and repeat. You have to specifically make time every day to make sure the actual important things in life stay.
No business expansion: I think I’ve had a pretty successful year all things considered but I haven’t taken to opportunity to expand the business beyond myself. There’s great opportunity out there and cornering a small piece and focusing on managing the delivery is where I want to be. It’s a difficult concept to be working over full time on two major projects as an individual as well as trying to establish new leads and following them up. This will be my biggest challenge over the coming years.
Managing a day job as well as a business: is a challenge albeit the involvement has been minimal, thinking about business accounts and taxation requirements are all new to me. To be fair to the accountancy firm I'm working it, Harts ltd of Macclesfield, they are very good at organising everything. I make sure I keep track of my income and spend and they sort the rest for me. Run the VAT calculation, statutory filing requirements, year-end accounts, payroll, and the lot. They’ve made things really easy for me and I don’t think you can overrate a good accountant!
Although I have put my hand to creating an excel workbook that tracks spend every way to Sunday so I know where the money is going. It's categorised, labeled, spit per week/ month/quarter and year takes a pass at calculating the year-end position and even tracks my time. It may not be orthodox but it does allow all the data at my fingertips.
My biggest successes:
Your results speak volumes: I think I’ve always been confident in my abilities as a commercial consultant / QS but project-wise I’ve really been put to the test this year. I’ve gotten through, and successfully, a significant amount of work. I have had some support both with advice from experienced members of the team and workload wise with support from the younger members. Overall, however, I have commercially managed a large(ish) portfolio.
Creating a business: sounds simple enough but to actually go through with it and commit to it. I’m 29 years old with about 8 years on good industry experience and I don’t see too many people trying to make the jump to self-employed in this industry at this stage. Maybe I have it wrong and really I need 10 years more experience before it’ll be a real success. But ... that’s okay with me; I have made some great contacts and some friends along the way this year. If I can build a reputation for success from now, surely in 10 years’ time it’ll put me in a better position than those just starting out?
Fitting into my client’s organisation: as a consultant into a much larger organisation, where externals supports would always be the first ones out the door at the first sign of trouble, I have built up really good and lasting relationships.
My year ahead:
So that's about it for my years past, I think now I'll just touch on my year ahead. Vague of a plan that it is, I'm going to set myself some personal and business goal as a marker for me to look back on. My overall goal is to slowly develop a wider clientele and take that first stepping stone away from effectively a sole practitioner. I think in order to achieve this, I want to:
1. I will bring my current portfolio to a successful close and final account them to a profitable and successful standing.
2. I would like to engage with local (northwest based) business with a view to spending more time at home with my family. The work-life balance definitely needs addressing!
3. I would like to become more prevalent on social media and build up a following as a business and on a personal blog about my journey and knowledge.
4. I would like to make that first step into expansion with bringing in my first employee.
5. I will be investing in myself: I have two more modules to conclude the MSc and I would like to gain chartered status with both the CIOB and CIArb to demonstrate my abilities and dedication to the profession.
Some of those goals are pretty lofty, but hey why not go for the gold? If you're reading, then thank you for taking the time, I appreciate it! If you found any of it helpful or insightful for you, or you're interested in finding out more or being a part of my journey then please get in touch.