Algeco – By Any Other Name

Last time we spoke with Algeco it was working under a completely different brand name, but that is not all that has changed!

It is not the first time we have talked with Algeco Offsite Solutions, although the last time we took a look at the modular construction firm it was called the Elliott Group. The firm has recently consolidated its brand as part of a process of integration of recent acquisitions, now trading under the widely recognised Algeco name; the brand being uniform across its European business.

“The acquisitions have been carefully integrated, providing the group with much further coverage and capability, with new colleagues very much part of a wider team now,” says James Withey, the company’s new Managing Director.

When we last spoke with Elliott Group, we learned that the company’s method of deploying modular construction, manufacturing parts of the building at its factories before assembling them on site, was one regarded with some reluctance by the traditional construction sector. That perception was changing then, but when we speak with Mr Withey it sounds like the industry has truly woken up to the potential of modular construction methods.

I’ve only been in the MMC business for a year, but I would say there’s an absolute recognition that modular construction delivers many benefits beyond traditional construction, however it can work hand in glove with older methods,” Withey insists. “A modular construction environment can be safer, deliver a higher quality product in a shorter time and providing the design is standardised, offer efficiency versus traditional construction. Unlocking the benefits of MMC requires a level of repetition”. “Providing customers or their advisors consider Modular early enough in their design process, these benefits can be unlocked to their advantage. Indeed, several main contractors, without their own MMC capability have recognised this and are collaborating with us so they too can benefit”.

At the same time as perceptions change, so have Algeco’s methods, and the company has made significant investments in its products. Their new award-winning Seismic Steel Frame technology provides “a more sustainable platform and process upon which to scale” their business, Withey tells us.

Algeco itself has undergone significant transformation since we last saw them, even beyond the new branding. The company has significantly increased its revenues and has diversified into two additional sectors. It employs approximately 30% more staff than it did a year ago, while its products have become more standardised as it has begun to digitise some of its processes.

“We’re investing in people as well as our plant”.  There is not one area of the business that has remained static,” Withey says. “We have made progressions in all aspects of people, platform, and process. We have a superb capability and team, and as the market is increasingly looking at modern methods of construction and how it can take real advantage of them, we want to compete and help shape it”.

A Matter of Priorities

Whilst Algeco Offsite Solutions is growing, it has seen market demand grow alongside it, as interest increases in MMC.

“The question is where to focus and prioritise,” Withey tells us. “That has been the biggest challenge, especially for a small to medium size business. We don’t have limitless resources, so it is about making sure that with the resources we have we execute our plans well.”

Prioritising how those resources are used is a matter of measurement. As Withey explains, whatever the business, whatever its ownership structure, shareholders want a return on the capital they have invested.

Within the sectors we work, there is urgency for new facilities and yet the demand is long term. That enables designs to be standardised, unlocking the true benefits of MMC.”

“Programmes of repeatable work and predictable demand which attract investment, enable MMC growth. He encourages clients with such a profile to engage Modular providers early in the design process, to maximise the benefits”.

In being proactive, rather than reactive, Algeco is pursuing innovation across its business.

The Seismic Platform was on the drawing board the last time we spoke with the company, and now it is commercialised. “We have proven it beyond feasibility, taken it into reality and it is a product being delivered right now to the Department of Education, in use on two new school projects”

We have collaborated with industry partners and academia to create the Seismic platform, we intend to leverage this success and develop a ‘Halo product’ which will go across all of our vertical sectors, enabling us to deliver consistency and further standardisation,” Withey tells us.

After School

While education and schools were always the foundation of Algeco’s work, with 30 years of history in the sector behind them, Withey is excited about entering new markets.

“We are working for the Ministry of Defence to deliver single-living accommodation projects. These essentially are accommodation products that sit inside the wire of a defence establishment,” he says. “The platform feasibly could be developed to enable us to pivot into other sectors such as hotel accommodation, build-to-rent, student housing and healthcare, when the time is right.

Addressing multiple sectors with an iteration of the design is a methodology which closely aligns with the principle of standardisation.

A particular advantage of Algeco’s modular construction techniques is that they allow for the majority of the work to be done off-site, which is useful for sectors where site disruption and time on site need to be minimised.  Withey believes the best results can be brought about through a collaborative approach.

“I’m a collaborator by nature. One of the things I’ve tried to do is establish networks and relationships with tier-one contractors and developers looking for a partner, to deliver their schemes more quickly, safely, and efficiently,” he says. “That is starting to open opportunities for our business, because they get access to an MMC capability they might not otherwise have, without the expense of acquisition.  There is a strength in that relationship, as opposed to a traditional subcontractor model.

It is clear talking to Withey that his energy and vision for the future of Algeco are tangible.

“It is an exciting place to work at the moment. This role couples my experience of real estate with my background in manufacturing,” he says. “From that point of view, I have a really enthused team who are on a fantastic growth journey. There is a real buzz around the business and there are good development opportunities and careers within.”

As excited as Withey is, however, he will not lose sight of what is essential for Algeco’s future.

It comes back to serving the client. We’re in five different sectors and starting to specialise in each of those. We need to keep looking ahead to ensure we can satisfy the customer’s need and standardise to remain efficient and effective. Doing so will ensure we grow sustainably and help shape the future of construction.”

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