Southwest Design Firms Anticipate A Tempered Surge
Through innovation, nimbleness and relationships, design and engineering firms in the region ready for a brighter, continually challenging future
ENR Southwest’s annual survey of design and engineering firms reveals revenue for the region’s largest companies grew in 2015.
This year’s survey includes 62 firms, down one from last year, but those firms earned a combined $799.36 million in design revenue in 2015. That total is up nearly $70 million from last year. Although there are 17 firms in this year’s survey who did not participate last year, all but one of the top 10 previously submitted data.
Click Here to View the 2016 Southwest Top Design Firms
Revenue for the top 10 firms increased from $318.34 to $357.68 million.
Some in the industry connect recent gains and potential activity in the market with a blossoming market throughout the states of the Southwest in the next year.
“In the coming months, this region is going to outperform the rest of the country, for a change,” says Chuck Reynolds, Terracon’s senior client development manager, Phoenix. “For the foreseeable future, and I don’t know exactly what that timeframe is, private is going to outpace the public sector. It goes in cycles, but this might be a long one.”
New Boom Unlike Old Booms
Firms like Terracon, Reynolds says, that were balanced in project types and sectors were those best suited to adapt to leaner years.
“It’s a mistake to go too strongly in any one direction,” Reynolds says. “If we were to totally ignore any agency in the region, we could lose those relationships, and this is a relationship business.”
While the future may be brighter than in the recent past, Reynolds says challenges remain.
“I don’t know if we will ever see the growth we saw entering the 21st century, but that’s probably a good thing. We will see a pressure on margins. It’s difficult to make money, and that will stay the same. [Profit] is going to be well earned,” he says.
Brad Woodman, vice president, SmithGroup, agrees, saying, “We have a lot of things in the hopper that if, and when, they pop, we are going to be very happy.”
Today’s Nimble Firms
Part of the formula to remain successful is to have the ability for mobile teams to do the work wherever it may be.
Woodman says technological advances have changed the traditional ideas of “offices” and “staffs” and make firms competitive outside of their immediate geographic areas. He says nearly 50% of his firm’s work comes from outside their traditional region of the Southwest that is served from the Phoenix office.
“In some cases it begins to level some playing fields,” Woodman says.
Reynolds says engineering and design firms continue to find ways to automate and streamline to provide services cheaper, faster and better through innovation and technology.
“We will continue to invest to do better to separate ourselves from the competition,” he says.