Deloitte Fast 50 Q&A

Tauranga-based ZB Homes (BOP) became the first construction business in the 17-year history of the Deloitte Fast 50 Index* to take out the top spot, achieving a massive 1583% revenue growth over the past three years. We talked to managing director Rik Flowerday about how the company has been able to achieve such phenomenal success

Q: Tell us about your business?

We’ve been operating since February 2014 and started with only a pair of builders, with my wife and I running the office.

Today, we have 13 office staff, which includes our pre-production team who manage jobs until they come out of council and a production team who manage jobs during construction, along with a Construction Manager and Construction Supervisor.

We also have a team of around 25 builders – most of them are contract square metre rate builders, although we also have a few core team ZB Builders.

Q: What were the biggest challenges for you in growing the business?

Putting systems and processes in place to support the increasing volume of work and growth, while at the same time running the day-to-day operations.

Q: Did you seek advice from any mentors/business coaches and how did they help you?

Yes, I have had many coaches and mentors over the years. While I provide the drive and am responsible for the overall management of the business,

I bring in experts to help in areas where I feel there is a need. I also currently have a business coach who I meet with weekly to discuss our higher-level business strategies.

Q: What marketing strategies do you use?

Before we started, we developed a marketing strategy as part of the overall business plan. However, the reality was that once we got started we had no time for marketing – we could only just keep up with sales from people walking in through the show home door!

Initially our ‘marketing’ was the show home, our website, having a variety of house and land packages available and a little bit of radio advertising. Now we employ an external marketing and PR agency, which manages most of that for us.

We have printed marketing material and are looking more into how we can build our profile online. We have two show homes, which continue to be the backbone of our marketing, as well as buying land and having a selection of house and land packages available at different price points.

Q: Do you plan to continue to grow at the same rate in the future?

Continued growth at this level may be possible but is not likely, particularly as the market is cooling somewhat.

Instead, we are focused on fine-tuning our systems and making sure we have a robust business that will withstand market fluctuations and the test of time.

Q: Was this level of growth always your goal, or has it just happened naturally?

A bit of both – we always planned to grow to this size, but not at this pace. However, the market in Tauranga was booming and that presented us with an opportunity to grow fast, so we grabbed it.

Q: How much time do you spend on the tools now?

None, I am not a builder by trade. Zane Beckett, my business partner and codirector, is a builder. He founded the ZB Homes business in the Waikato and, like me, he is off the tools and spends all his time running the business.

Q: How have you been able to retain the quality of your builds during such an explosive period of growth?

That has been a challenge, but from day one we have been focused on delivering a quality product and have worked very hard to not let that slip.

Although not on the tools now, our Construction Manager and Construction Supervisor are both exceptional builders.

They have high expectations, which are communicated to builders and subcontractors. Rough or shoddy work is not tolerated – we care about our product and are proud to deliver quality homes.

Q: How have you been able to ensure new staff deliver the quality you expect in the face of current labour shortages?

By having a Construction Manager and Construction Supervisor on-site managing the foreman on every job.

Both are sticklers for quality. We also choose our ZB and contract builders carefully – we are fussy!

Q: What advice would you give to other builders wanting to grow their businesses?

For volume work, you need streamlined, integrated systems in place. Without them, you cannot operate efficiently and you will end up with frustrated clients, builders, staff, suppliers and sub-contractors! We are continuously working on improving our systems.

Also, seek advice from coaches and mentors and implement strategies that come out of these meetings – they may not be perfect, but you can tweak them as you go. Learning the numbers is key

too; cash flow is crucial, but it does not equal profit.

Q: What have you found the most enjoyable aspect of growing your business?

Creating an awesome team; we work with some amazing people! We are very proud of them and they are proud of what we do – that’s what makes all the challenges worthwhile.

Q: Staying abreast of and complying with stricter regulations and changes to the Building Code

are a common challenge facing all builders. How have you managed that process?

We are members of New Zealand Certified Builders (NZCB), which provides us with information relating to any changes and new regulations, as well as training, industry events, etc, which is a great help.

At the end of the day, we have to make sure we are up to date on everything, because the buck stops with us. You have to make the time to keep up to date.

Q: What do you think have been the top five keys to your success?

• High sales volume.
• Not letting quality slide.
• Developing our own land / sections.
• Continuous systems improvement.
• Making the most of opportunities as they come along.

*In operation in 32 countries, the Deloitte Fast 50 ranks and celebrates fast-growing companies.