No Fuss

As the credit crunch has unfolded there have been many stories of business failures. And yet, in such times, a number of success stories always emerge. Lexington Catering appears to be one such example, with a projected 40% increase in net profit this year, having doubled net profit in 2008. The company was recently the only hospitality business to be recognised in The Sunday Times ‘100 Best Companies’. Many would like to be able to tell such a tale.

EP met with Tim West and Mike Sunley to learn more about what lies behind Lexington’s success and also their professional relationship, which has lasted the test of time – for more than 25 years in three different companies

A simple, throwaway line by a consultant set me thinking. They had casually remarked: “There is no question that Lexington will do well because they do all the basics well – they are just thoroughly professional. Some of the others may struggle, but not Lexington.”

It is easy to see why they made such a comment. The company is led by two very experienced and well-known figures. The last three years will have seen the company grow from a turnover of £6.5 million in 2007 to a projected £15 million in 2009, in a market that is fiercely competitive.

But success rarely comes easily and generally there is an interesting story behind the scenes. Is the track record of Lexington’s leading players and their working relationship a core factor behind their success?

Lexington was founded in 2002 by Mike Sunley and Clare Prowse together with Katharine Lewis and Rachel Lindner. All had been executives with Avenance and left to found the new company. Very quickly, they won the T-Mobile contract, worth £5 million pa: a major coup. However, three years later in 2005, when some of the priorities of T-Mobile changed, disaster struck as the contract was lost, equating to 70% of Lexington’s turnover.

Unsurprisingly in such circumstances, the founding partnership became strained and fractured. It was a difficult time and Mike turned to his former CEO – Tim West – for advice. Tim, in turn, indicated that he had actually resigned and was looking at options for future investment and that this might include Lexington.

This took many by surprise. Gossip is notoriously inaccurate, as between 2002-2005 it had been assumed that the relationship between Mike and Tim
had been strained. It was a fair assumption as theirs had previously been a close working relationship, and many would be placed under pressure when
one resigns from the board to set up in competition. It says much for both that it had no such effect. Perhaps this should have been no surprise as they
had worked together since 1984 in both Compass and High Table/Avenance before Lexington.

However, Tim joining Lexington was still a major story. He had been the face of both High Table and, later, Avenance since the early 90s. He was one of the industry’s leading figures and many wondered what he would do after his departure. Where would Tim go now? Would he leave centre stage?

When Tim and Mike joined forces in January 2006, Lexington was loss-making and needed reinvigorating. The relationship between Tim and Mike was proven – but would it work as well in new circumstances?

Tim: “I was at a stage in my life where I felt I had enjoyed a successful career, but also that I had one more good fight left in me. When Mike approached me, I was interested as I knew we could work together and shared similar values.”

Mike: “I think that business relationships are often formed for the wrong reasons. Sometimes you start with an agreement of what you are moving away from rather than what you are trying to build for the future. It is so important to get these relationships right. Tim and I had a good relationship before and we knew that this firm foundation would be essential to future success.”

It is this relationship that has attracted confidence and comments, such as the one expressed by the consultant, and also attracted a very strong team to work with them. So what is it that makes their relationship work?

Tim: “A major factor of our success over many years has been that we have been able to pick good people and grow with them. In Lexington I think that we have brought an excellent team together that really wants to work as one.”

Mike: “We think along similar lines and there are no moments of high drama. We adjust to each other and get on with things.”

Tim: “Mike is a no-fuss operator and this helps. We have no egos – no need to be in the limelight. We just want to build Lexington. We believe in each other and in what we promise.”

Mike: “I think that is right. We do not over-promise. We believe in what we do and we can sell it.”

Tim: “Partly because we have worked together for solong and partly because of our approach, we just let  each other get on with our roles and trust one another. Mike is excellent at building teams. Running his own business has revitalised him and the team has so much positive energy that we all want to drive things forward.”

Mike: “Tim adds balance and perspective. He is very calm in his approach and he understands the bigger picture.”

Tim: “Clients like to see drive, delivery and vision. If we deliver on what we say we are going to do, they will talk about us and recommend us to others. We are caterers and have been working in this market for more than 20 years and believe that it takes time to understand this sector and to build up appropriate  knowledge.”

2008 and 2009 to date has been a well-documented difficult period for business generally, and yet Lexington appears to be outperforming the market. Why?

Mike: “I think that our approach allows us to be a credible alternative to the main players in the market. We also have a strong team of people who have been working in this market for a long time – people who are well-known and well-established players in their own rights. Rob Kirby, Rachel Linder, Katharine Lewis and Julia Edmonds are good examples.”

I wondered how important it was to be named as one of the “Best Companies”?

Mike: “It is an amazing accolade as it comes from our own people and represents their views. It is not awarded by a group of judges and it therefore has more meaning.”

Tim: “People are top of our values. We want to lead by example; we want to build a business that does the right thing, a business that endorses best practices. I think that this award confirms we are doing that.”

So what of the future?

Tim: “We are in a good position but clearly we need to be sensible. Our pipeline is strong. We should be able to grow very well through organic growth, which is the purest form of growth.”

Mike: “The credit crunch for us was back in 2005-06 – that was when it was tough. We do not need to adapt mentally to the new landscape as we were there not
so long ago and learnt our lessons.”

One of the problems that Lexington face is that, as with the consultant, many just assume that they will be successful and, of course, life is rarely so easy. High expectations could be both an advantage and a problem but whichever it is, Lexington seems o be progressing soundly down the road.

It will be interesting to observe how Lexington evolves and how its story unfolds. It is almost as though there is a new chapter to be written.