Providing temporary staff for the food industry has seen growth mushroom for Vital Recruitment. Since starting life from a single office location in 2004, Peterborough-based Vital Recruitment has seen its turnover soar from £5m to more that £80m. It now has ten offices around the UK and more than 7,000 agency staff . What has been its recipe for success? “Where most people were failing or not delivering what they said they would, we always did,” explains Terry Waite. “We were reliable. We could be counted upon; we had a good reputation within the workforce and we had a unique selling point in transport provision. It was a part of our business that most competitors shied away from – while we decided that we would back it fully.”
Transport is a hard thing to manage and can eat away at your margins. But for Vital and its clients, access to a fleet of minibuses and coaches has been key to ensuring that temporary staff arrive on time for seasonal and peak production shifts in the food processing and agricultural industries. “Other labour providers wouldn’t know if they were short-staffed until the customer rang and said: ‘Hold on, there are 5, 10, 15 or 20 people missing this morning’,” Terry says. “We were never in that position – we were in complete control because we knew how many workers we were delivering in our own transport. So we always delivered excellence, which I think contributed to our rapid growth.”
Vital has also made two major acquisitions – of a Peterborough-based business turning over around £18m and a Kent-based recruiter turning over around £15m. Haines Watts advised on both deals. “The acquisitions were before I joined the group, but came at just the right time,” explains Vital’s Financial Controller, Nat Varatheesan. “Haines Watts were relied upon heavily. They had to do the extra work in terms of due diligence, and assisting with integration of the businesses. That’s a time when the whole thing can fall apart – so they’ve been quite integral in absorbing the businesses into the group and thereby helping the group to grow.”
Vital’s performance and reputation was acknowledged earlier this year when it was acquired by the AIM-listed Staffline Group, a Nottingham-based business which reported revenues of almost £1bn for the year to end December 2017 and pre-tax profits of just over £24m. “Staffline said they wanted to expand into East Anglia, where they had very little footprint,” Terry explains. “They had targets they were trying to hit, and I think Vital was perfect for them because we had exactly what they wanted – good solid business and a respected reputation in this area. I think that’s primarily why they approached us to buy. “We looked at Staffline as a good company – and as a good opportunity, too,” he adds. “We liked what they wanted to do and we thought Vital would fit quite well into their portfolio. They made a specific point of saying they liked Vital’s values and what we were about. We’ve grown enormously, but at heart we’re still a small team of committed individuals – so it’s very much a hands-on business.”
Haines Watts also advised on the Staffline deal, including sale price, terms and conditions, due diligence, sales and purchase agreements, other contract documentation and taxation matters arising from the sale. “Haines Watts have been our partners over the years and have watched us grow – so they really know the business inside out in terms of our fi nancial situation,” Terry continues. “Staffline are a £1bn turnover business; Haines Watts were instrumental in working with their due diligence team. They got into the bones of everything. It was excellent; they dotted every ‘i’ and crossed every ‘t’ to ensure all the information needed was available.” Being part of Staffline will help Vital springboard into new industries and provide a base for further growth. “We’re part of a massive organisation that’s got a great foothold right across the UK now,” Waite states. “It’s opened up a lot of channels. The world’s our oyster and the opportunities for our staff are going to be huge now because we’re part of a bigger operation. “We’re partnering with the right people to take this business on. I think Staffline want to grow revenues to £2bn in the next five years. They’ve got a real thirst to grow – and I think that can only be good for all the people who work at Vital, because we’ll be part of that too.”
Where most people were failing or not delivering what they said they would, we always did.
Terry Waite Vital Recruitment
Haines Watts Partner view
Haines Watts has been advising Vital Recruitment for about 15 years; we sit down with them every year and draw up a plan to grow the business both organically and acquisitively. We did all the advisory and due diligence work on two acquisitions of competitors turning over £18m and £15m.
We also restructured the business, in line with its ambition, to transform it from a local Peterborough-known company into a regional corporate entity; we sourced and implemented new HR and payroll software for 7,000 temporary and permanent staff.
Compliance is a key issue for recruitment clients – including immigration, employment law and ‘Gangmaster’ licensing legislation. So we helped Vital devise systems and processes to ensure compliance was a key focus. This was a big attraction for Staffline, because it meant the business could be integrated easily.
Our work on the sale included due diligence, taxation work and reviewing contracts. Staffline is a household name in recruitment, so I think there’ll be further growth ahead.
Mohammad YousafDirector, Haines Watts Peterborough