Miles Brown, managing partner of Coffin Mew, met with Spencer McCarthy of Churchill Retirement Living, a South Coast success story. The family-owned company, which started life in a small office above a garage in New Milton in 1994, turned-over £143 million in 2015 with an operating profit of £43m and is on target to hit turnover of c£185m with a £60m operating profit in the next financial year
Following a restructured finance package in 2014 the company, which provides retirement developments nationwide, has seen a period of rapid growth. The workforce has increased from 300 to 460, two additional regional offices have opened (taking the total to six nationwide) and a £3m investment in contemporary new offices has seen the Ringwood HQ double in size . The in-house management company Millstream Management Services is also looking to relocate to larger premises in the New Forest.
But with such expansion comes a new challenge, critical to ensuring the company remains on track to be the most successful housebuilder in the UK – as seven times winner of the UK over-50s Housing Awards it is already the country’s most successful builder of retirement homes. “As the company grows we are reliant on more and more people to implement procedures, policies and ideas. The problem we are finding is new employees wanting to reinvent the wheel, and when they make changes costs start getting out of control,” explains chairman and CEO Spencer McCarthy who jointly founded the company, originally Emlor Homes, with his brother and MD Clinton McCarthy.
As someone who credits the staff with his company’s success, McCarthy is focused on ensuring he remains in touch with them and they remain in touch with the company ethos. “We have an extremely successful business model which provides clear, standard specifications and product. As long as people stick to these tried and tested methods the company will be successful.”
McCarthy is employing a raft of initiatives to ensure both new and experienced staff do just that. Top of the list is a ‘Back to Basics’ programme. “It’s all about re-aligning the wheel not reinventing it,” McCarthy stressed. Crucial to this is a new in-house compliance department which he describes as a ‘breath of fresh air’. Internal communication is also high on the agenda as McCarthy is a big believer in keeping staff informed – staff appraisals have been replaced with 30-minute meetings every two months and McCarthy hosts face-to-face Q&A sessions at every office twice a year. All five MDs must also learn the company’s policy documents inside-out.
This focused approach works. Margins are currently 30.7% net – the highest in the UK housing industry. “Because we are so good at controlling our base costs we are able to maintain strong margins while growing,” McCarthy added that standardisation is a key element. “We have exactly the same product throughout the country, our show flats look identical right down to pictures on walls”. Change is welcomed but only under strict conditions. “Unless it is better for business we won’t change anything and once we have agreed something, that’s the way I want it done.”
McCarthy admits being profit-driven but believes his developments provide a solution for many over-65s who want the security and social benefits of a community environment with the independence of their own home. He regularly joins customers for coffee mornings and knows getting the build right is only half the story. “After 22 years I realise the key to any successful company is its employees. If I was starting again I would listen to and engage them more.” But McCarthy is adamant he only wants staff with the right attitude and commitment. “Getting the right fit for the company can be difficult. People can mislead in CVs and interviews. We now have an in-house recruitment department and psychometric testing to give a very clear picture of an individual’s personality.”
Describing the company as ‘one big family’, McCarthy is keen to reward loyalty. Staff currently enjoy company health insurance, days off on birthdays, vouchers for expectant parents and last year were invited to a garden party at the chairman’s home.
This has not gone unnoticed. Churchill Retirement Living has appeared in The Sunday Times Best Small Companies to Work For Awards five times and recently secured 14th place in the Top 100 medium category. Other awards include HBF’s five-star rating following recommendations by 94% of Churchill customers. But perhaps the biggest endorsement is from McCarthy’s in-laws, Kate and Andrew Robinson-Wooledge and late grandmother Edna Andrews – all three chose to live in Churchill retirement apartments.