Whatever floats your boat, reputation matters

David Clancy, development director of S Harrison

What does the Seabourne Freight fiasco tell us about doing business?

There are some screamingly obvious lessons to be learned from the furore surrounding the transport secretary’s dalliance with a shipping company with no ships and no track-record, no confirmed financial backing and no agreement from the ports through which it would operate. If it wasn’t potentially so serious it would be funny.

Whether or not sufficient due-diligence was carried out before making the contract offer remains in contention.  But any self-respecting business leader will tell you that you also always take thorough soundings from those who have real experience of working with a business partner before you sign them up, at any level.

Track record, longevity, reputation, all count for something, especially when the product or service on offer is slightly amorphous in nature. Take the example of seeking a development partner for a land or property asset for instance.  

Anyone can talk a great story about what will be delivered, how, how quickly and at what appealing value. But if your financial return from the deal is conditional on the ultimate delivery of the development and its resultant value, the deal is predicated, effectively, on little more than a promise. And if you are taking a promise, it is wise to research the track record of the people making it. Very quickly, what looks like the most appealing, perhaps the most financially lucrative offer may not look like the best one.

Always worth checking whether the developer has completed similar schemes and if so, how closely the final outcome matches the original idea.

Worth checking how happy the end-user is with the product delivered.

Worth ascertaining how well respected the developer is with the planning and other statutory authorities involved in the planning and delivery process.

Worth checking whose money they are putting where their mouth is.  

And, call it old-fashioned if you like, meet the principals of the business, the decision makers (hopefully they are the people you would be dealing with throughout the process) and look into the whites of their eyes. Good business is built on trust, but trust is built on knowledge and relationships.

All very well you say, but if the developer is looking to acquire the asset unconditionally then why should you worry about what will happen thereafter? Delivering a new development through the sometimes fickle and uncertain process of planning, and meeting all the onsite challenges, keeping other stakeholders happy – they all become the developer’s problem, don’t they?  

Except how they deliver, what they deliver, and how non-invested stakeholders view it, impacts on your reputation, whether you like it or not.  And at that point, it is something over which you have no control.

Continuing the watery metaphor, we have always said you only see who is swimming naked when the tide goes out. But in calm or choppy waters, knowing for certain that the partner with whom you are setting sail is water-tight is a responsibility you owe it to yourself to fulfil.

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Yorkshire-based Harrison is one of the UK’s most respected property development companies with a successful track-record spanning over 60 years. The company has been shortlisted for the Business Masters Awards 2019. 

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