Failed contractor Swift Horsman was propped up by main contractors paying for its materials up-front for around six months prior to falling into administration in December, company insiders have revealed.
The company is also understood to have been winning prestige contracts right up until the final weeks. Recent contract wins include a £4.5m fit-out and joinery contract at the British Museum, secured in mid-October.
It is thought that 220 staff will be made redundant now that the company is in the hands of administrators from PriceWaterhouseCoopers.
A source who knew the company well said: “As a trade contractor, your suppliers demand payment up-front for materials, then your clients demand extended payment terms. Trade contractors are caught in between.
“For six months I understand main contractors helped them out by buying their materials to help them along. But ultimately, when you’re not working as much as you should and you have a large overhead – a joinery facility and a factory up in Scotland [in Dalbeatie] – it all costs money at a time when people are forcing the price of your product down.”
But another insider said: “I don’t think this is the end of the story, the administrators ought to be able to salvage something. It was a very good business with excellent products, and there is still a demand for that out there.”
In October the contractor was selected by construction manager Mace to fulfill a major contract at the British Museum World Conservation Centre, a £135m new extension to the world famous facility. It was also working with Mace on the fit-out of The Place at London Bridge Quarter, next to The Shard.
Swift Horsman, which was active in fit-out, joinery and manufacturing offsite “pod” systems, secured regular contracts with the industry’s top tier of contractors and clients, including Sir Robert McApline, Skanska, Mace, British Land, Bovis Lend Lease and Stanhope.
Projects spanned the commercial, public and cultural sectors, including the fit-out of the BBC Scotland HQ, the Royal Shakespeare Theatre in Stratford and Renzo Piano’s Central St Giles office scheme.
Swift Horsman was also known for its R&D investment in offsite manufacture, particularly its Podwall washroom system, and training apprentices at its own skills academy.
Around three years ago it was actively exploring export markets in Africa for its offsite systems, planning to work in joint venture with a South African contractor. However, the venture came to nothing.
The loss of 40 jobs in the Scottish borders was raised today at First Minister’s Questions in the Scottish Parliament by the local MSP Alex Fergusson.