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Colin Lewis, CEO of Avant Homes, shares his belief that "you don’t need a brilliant economy to drive growth" and explains where he sees opportunity amid the uncertainty in 2020.
PwC’s 23rd CEO Survey has revealed UK business leaders are planning a practical and purposeful response to economic uncertainty. Here, Colin Lewis, Chief Executive Officer of the privately-owned housebuilder Avant Homes, discusses the approach he’s taking in 2020.
“You don’t need a brilliant economy to drive growth. Whatever you do, don’t batten down the hatches so tight that you can’t see out - because you won’t see opportunities either.”
Colin Lewis joined Avant Homes as Chief Operating Officer in the summer of 2010. “We were coming out of a recession then, but we couldn’t be sure,” Lewis says.
House builders today are arguably better placed to weather any economic uncertainty, but Lewis says no industry can afford to be complacent. Even in economic uncertainty, he argues, there is a market to play for.
Lewis has ambitious plans to double Avant’s output over the next five years to put 4,000 new homes on the market in the UK every year.
Lewis is focusing on “right-sizing the business”. He adds: “One of the mantras I’ve applied since I’ve joined this business is that we must ensure that we are value-led, cost-conscious. Not cost-led.”
Of course, Lewis says, the company is looking at its cost base. That chimes with the broader results from this year’s UK CEO survey: some 79% of respondents said they are planning to implement operational efficiencies.
But Lewis wants to make sure the balance is right between controlling costs and investing in things that will make a difference. To this end, Avant plans to continue to invest “heavily” in research, training its people and optimising its products.
“65% of UK CEOs plan to launch a new product in 2020 and 42% are exploring a new market to remain competitive.”
Meanwhile Lewis, similarly to other CEOs who took part in our survey, is eyeing new markets - targeting new areas and acquiring more land. Avant operates in Scotland, the north east of England, Yorkshire and the Midlands. Lewis says the group is “constantly looking” to expand into North West England and West Midlands and will rekindle its search for acquisitions once the uncertainty around Brexit clears.
Lewis says crucial to driving such growth is optimising your product. “Don’t just continue to do what you’ve always done, because it’s been successful,” he advises. “Look very closely and very objectively as to whether you can make improvements.” Avant found that its product range appealed to around 40-45% of the housing market, so it has responded by developing a second range to extend their reach to around 75% of the market.
Lewis says he “feels confident” that Avant can continue its growth model over the next 12-24 months. With greater political stability, he thinks a slowdown over the next 12 months is “less likely” and instead expects a “period of optimism”.
“I’m more concerned about two or three years out,” he says, pointing to questions over the government’s spending plans. Either way, navigating uncertainty is all in the timing, says Lewis.
And to get that right, he advises, be sensitive to your issues, keep very close to your business and invest in the right expertise to make sure that if the tough times come, you’ve got the skills base around you to manage that process.
PwC’s interview with Colin Lewis took place on 16 December 2019.