Britain’s business community needs role models. With Brexit continuing to add national uncertainty to an already precarious global economic outlook, business leaders require guidance on how to navigate choppy financial waters.
The template is already there: our New Economy report offers pointers on the kinds of high-growth, mid-sized businesses that will make up the UK economic engine of tomorrow. But for a concrete example, take a trip to the heart of the country.
DRP Group (“DRPG”) of Worcestershire is a creative communications leader that is doing many of the things that our New Economy report states will be key to economic success. It is investing in technology to stay at the forefront of a tech-driven sector, for instance.
It is also tackling skills gaps with its own training academy, apprenticeship scheme and schools and university recruitment programme. And it’s doing well, growing an average of almost 37% over the last three years to achieve a £31m turnover with a staff of 330. They have healthy growth plans of £100m by 2023.
This growth has been partly organic and partly through acquisitions. DRPG selects possible acquisitions carefully from a packed field of hopefuls. “They come to us,” says DRPG’s founder and Group CEO, Dale Parmenter. “I’m turning a lot down on a weekly basis.”
He only picks purchases that fit in with DRPG’s ‘anything’s possible’ culture and will add value to the business. This means the bosses of companies coming into DRPG don’t get to walk away with a wad of cash. Earnout periods are de rigueur.
In return, though, the companies acquired by DRPG can expect to carry on much as they are, albeit with extra bells and whistles for growth. “We don’t want to destroy the reason why we bought them,” says Parmenter.
The formula seems to work. The corporate events specialist Penguins, for example, was turning over £4m a year when DRPG bought it in 2017. Now it is making £8m a year.
There’s more to come, with DRPG looking into four acquisitions to add to the five it has gone through so far. But DRPG’s focus is now extending to foreign markets, particularly Europe and America.
The company is in takeover talks with a German partner and boasts offices in Germany, Ireland and the USA. For Parmenter, it’s all about exporting British expertise. “The UK is seen as a centre of excellence for creativity and in this we see a great opportunity” he says.
Another export is a system of account management that has allowed DRPG to turbocharge its organic growth. Four years ago, the business started to create account teams to build relationships with major customers. “That’s been a real success, we’re hoping to achieve our first £10m per annum client,” Parmenter says.
Innovation, international investment, sustained growth and careful nurturing of talent are all hallmarks of the new economy business ecosystem that Britain will need to thrive in the coming years.
DRPG proves this mix doesn’t have to be restricted to cities like London and can just as easily happen in the wilds of Worcestershire. Other businesses might well want to take note of the formula.
Download a copy of our report to discover what other companies are driving growth in Worcestershire.
Gary Rouse is a Director at BDO.