WITH investment in construction across Scotland at a ten-year high, Roddy Donaldson is getting what undoubtedly feels like a long-overdue reprieve.
The managing director of recruitment company Maxwell Bruce is coming off a record year in which turnover reached £13 million, while the number of clients subscribing to its base of mainly temporary workers doubled to more than 80.
What’s more, he’s predicting the company’s three offices will fill at least 1,400 construction jobs in the coming year – a conservative estimate based on the detailed intentions of its clients. Meanwhile, demand for engineering and industrial workers – the two other main sectors served by Maxwell Bruce – is robust.
“We think there is a lot of growth to be had in our markets,” says Donaldson, who is casually attired on a visit to the Maxwell Bruce office in Glasgow’s city centre.
But the Edinburgh-born executive – who lives in the capital with his wife and three boys – is far from complacent. In the years since taking the helm at Maxwell Bruce, he has twice hauled the company back from the brink.
The most recent and obvious crisis followed the banking turmoil of 2008 and the ensuing credit crunch. The collapse of property prices that led to abandoned projects, widespread repossessions and the bankruptcy of numerous building firms would have taken out Maxwell Bruce as well if not for dramatic and painful cutbacks that Donaldson isn’t likely to forget soon.
“The recession was the biggest learning curve I have ever had,” Donaldson says. “I learned all about the benefits of a big front-end and a tight back-end.”
It was a perilous period, but not his first dalliance with disaster at Maxwell Bruce.
Raised in the Borders, from where his mother hails, Donaldson was drawn at an early age to the rumbling activity of the construction sector. Trained as a quantity surveyor at Napier University, he spent a year plying that trade before deciding it wasn’t right for him.
He moved into construction recruitment and spent ten years with Melville Craig, which eventually became part of the Hudson group. Then, following a casual conversation in a pub, he heard about an opportunity to help rebuild struggling Maxwell Bruce.
The Glasgow-based recruitment group was reeling from the closure of computer firm Fullerton’s factory in Inverclyde, where Maxwell Bruce provided thousands of temporary staff. The loss of its biggest client had forced Maxwell Bruce to slash its own headcount from 55 to five, leaving co-founder Bruce Fitzgerald looking for new lines of business.
Donaldson teamed up with fellow Melville Craig veteran Chris Ferguson to take a majority stake in the firm. They joined in November 2003 where Donaldson, as director of construction and property, implemented a new business strategy that took the recruitment group’s headcount back up to 20 within two years. With turnover edging up towards £4m, the firm’s recovery was taking hold when Fitzgerald died suddenly, leaving Donaldson to take over day-to-day operations. Ferguson continued as a non-executive, but the transition for Donaldson was challenging – though succession had been discussed in vague terms, concrete steps for handing over were still two to three years down the line.
“It was very daunting – we still had a lot of work to do,” Donaldson recalls. “Outwardly I was trying to smile and say to everyone that I was in control, but inside I was thinking ‘What are we going to do?’ The hardest thing I found was getting around the back end of the office. The impression I had always had in my mind is that if you sell plenty, then everything will be fine. That’s not always the case.”
He admits that it took “a few years” to get his head around the job, but by 2008 turnover was up to nearly £10m as Maxwell Bruce rode the surging tide of activity in property and construction. The company had just leased new offices in both Glasgow and Edinburgh – a total of 7,500 square feet – when the financial crisis started unfolding.
With half of the firm’s business linked to construction and property, the impact was predictable. There was a scramble to sub-let or otherwise offload newly-acquired floor space after three-quarters of its 57 staff across both offices were eventually made redundant. Forty of those people were let go on 4 November 2009 – a date Donaldson remembers clearly, as it was his birthday.
“Nobody knew what was around the corner, so you just had to get to a level where you were making some sort of money, or at least not losing money,” Donaldson says.
Revenues tumbled to £2.6m in 2010 before growth finally resumed the following year, by which point Maxwell Bruce had shed its Edinburgh office. Expansion thereafter was prudent rather than speculative – the company established a presence in Dundee as constructions clients were drawn to the £1 billion waterfront redevelopment. Six months later, Maxwell Bruce followed another major client into Fife by opening an office in Dunfermline.
Construction now contributes about one-third towards the group’s turnover, while engineering accounts for about 40 per cent. Although both are expanding apace, Donaldson is investing in new sectors such as energy and business support services to ensure Maxwell Bruce is never again over-reliant on a single industry.
He’s now targeting turnover of £25m within the next three years, a goal Donaldson believes is “achievable”. Acquisitions are a possibility, though these must take Maxwell Bruce into either new geographical areas or new sectors that fit alongside its existing operations.
“We have had discussions with a couple of other companies, but I don’t think those are likely to come to anything. It is a difficult one to get right – the willing buyer and the willing seller.”
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