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Thom's keeping it in the family with plumbing and kitchen firm

IN this week's SME Focus, an entrepreneur whose plumbing to kitchen design business faced challenges amid the economic downturn welcomes a recent improvement in trading but says the UK Government could do more to help the recovery in the sector take hold.

PERFECT FIT: Kenneth Thom says he has never looked back since joining the family business straight from school. Picture: Colin Templeton
PERFECT FIT: Kenneth Thom says he has never looked back since joining the family business straight from school. Picture: Colin Templeton

Name: Kenneth Thom

Age: 34

What is your business called? Barclay Erskine Ltd.

Where is it based? Rutherglen.

How many employees does it have? Nine.

What services does it offer?

Installation of domestic heating systems, boilers, general plumbing repairs and maintenance works. We also design, supply and install bathrooms and kitchens (via our sister company Create Bathroom and Kitchen Studio).

Who does it sell to? Private householders, local authorities and housing associations.

What is its turnover? £900,000 anticipated this financial year

When was it formed?

In 1862, the company was established as Erskine B. Plumber and Gas Fitter, trading from 34 Struthers Street, Calton. In 1963, my grandfather, Thomas Thom, took ownership of the firm and kept the Barclay Erskine trading name and in 1995, the firm became a limited company when my father Alan Thom became the owner. In 2003, the first Create Studio opened to the public and in 2005 another group company, Create Home Extensions, undertook its first home extension. We celebrated 150 years of trading in 2012.

Why did you take the plunge?

I am the fourth generation of my family to enter the company. We all entered as apprentice plumbers. I personally wanted to work in a job where you could physically mark what you had a achieved daily in respect of a boiler back working or a new kitchen installed etc.

What were you doing before you took the plunge?

I entered the company straight from school. I had been accepted to study politics at Stirling University, but within a few weeks of starting I decided the lure of the family business was more appealing and have never looked back since.

How did you raise the start-up funding?

The company has always been self-financing and we are proud to say we have never had any bank overdrafts. I think most family businesses are a bit old school in this respect and I aim to continue operating this way.

What was your biggest break?

About seven years ago, a customer who had used Barclay Erskine for all her plumbing needs for many years required her bath taken out and an easy access shower installed due to a worsening medical condition. She was receiving financial assistance via the local authority for the work and was presented with a list of their approved contractors, which at that time our company was not on. She was adamant only Barclay Erskine be allowed to do the job and she waited whilst we gained accreditation to become an approved contractor. After completing the works, the local authority began recommending us for other works. Our turnover went from approximately £250,000 to £750,000 within a three-year period, due mainly to this extra business.

What was your worst moment?

The recession has proved difficult due to council cutbacks and private householders reining in their spending, particularly on big-ticket items. Our turnover dropped from £1.3m to half that figure in two years and led to us having to make some valued staff members redundant. Those were difficult moments, particularly for my father who had employed many of them for years.

What do you enjoy about the business?

I really enjoy being part of a family business and although it has brought its challenges over the years, we have always put what is best for the business first. There will always be a difference of opinion of what should and should not be done but we have the same common goal on achieving success.

Sometimes you can have days when you don't win jobs and the next day you can win five new projects. I also enjoy working with fantastic employees who are as dedicated to making the business a success as I am.

What do you least enjoy?

I can't really say that there is anything I don't enjoy about the business as even when we don't win a job, we learn something about what to do in the future. I do take it personally when we lose tenders and put a lot of time and effort into preparing CAD bathroom and kitchen drawings only to be told that the customer doesn't want to proceed. Luckily, that doesn't happen often.

What are your ambitions for the future?

To grow the company in a controlled manner, focusing particularly on our Create bathroom and kitchen side of the business and placing less emphasis on being reliant on individual large clients. I don't think anyone saw what was coming with the recession and it was a big wake-up call to everyone to put a lot of thought into business strategy, which we have done. We are cautiously optimistic that we can build turnover back to pre-recession levels within the next two years.

We have enjoyed a significant increase in volumes of bathroom and boiler installations within the last six months (double this time last year), suggesting the market is improving. We are, however, fairly flat in terms of kitchen sales suggesting that when it comes to the most expensive area of home improvements, house owners are still cautious. The average spend on a new bathroom has also remained flat.

What are your priorities for the business?

To retain staff and customers, expand the customer base and raise awareness of company.

What single thing would most help you?

Suppliers delivering on time without shortages or damages!

What could Westminster or Scottish Government do which would most help?

Lower the rate of VAT on home improvement works. It would help homeowners and make repairs and maintenance more affordable for them. I really believe that it would allow the creation of more jobs and let businesses flourish.

What's the most valuable lesson you have learned?

Whilst it is important to plan ahead, don't tie yourself to a fixed plan as flexibility ensures a company's viability.

How do you relax?

With a one-year-old, that's tough! Going for walks with my wife, daughter and dog.

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