If you’ve been paying attention to the civil engineering business, you’ve probably noticed that many firms that existed just a few years ago have disappeared. A very active mergers and acquisitions (M&A) market is creating a consolidation of the industry with no end in sight. With a strain on resources due to retirements, reduced college enrollments, and competition with a growing number of other technical industries, our profession is going through a transformation. Acquiring firms (buyers) are choosing this route for the creation of redundancy, enhanced client services, increased market share, or a host of other reasons. Firms being acquired (sellers) may be going this route as they haven’t been able to create a sustainable business due to difficulties in recruiting or team-building or perhaps ownership transition was not successful.
One has to wonder, though, if many firms would actually need to be acquired if they had been able to execute a plan along the way to ensure their sustainability as a legacy firm? What if a redundant team could have been built? What if the ownership of the firm was effectively transferred over a long period of time so as to not put the ownership in the situation of having no other viable exit strategy other than to sell to a willing buyer?
Our Strategic Design
At Hoyle Tanner we have been tackling these issues head on for many years through strategic design of the firm with the goal of controlling our destiny and remaining who we are: a legacy firm privately owned by active employees supported by an energetic and sustainable team and trusting client base. Our goal is to stay the course and continue to grow and provide excellent career opportunities to our team members, and practice by our Vision, Mission, and Values.
Firms in our industry are getting larger – there is no doubt. The M&A market is active and the increasingly inflated purchase multipliers (typically factors of EBIDTA) can be extremely attractive to those who desire to sell. We have noted many friendly competitors who were small or mid-sized firms like us that no longer exist.
Morrissey Goodale, a well-known and well-respected management consulting firm for the A/E/C industry that provides M&A consulting services reported that in 2007 they completed one M&A transaction. Compare this to 2024 when they completed 50 and in the first four weeks of 2025 they have already completed five. Granted, the firm was founded in 2006 so perhaps business was just building in 2007, however, in 2021 there were 27 completed transactions. Their M&A completed transactions have essentially doubled in the last four years alone!
Our leadership is committed to avoiding the trend of becoming an answer to a “trivia question” about firms that used to be. How are we doing this?
- Steady growth of the team by investing in early career professionals
- Recruiting to create redundancy and bring in new skills
- Investing in technology, training, and certifications
- Hiring team members who believe in our Vision, Mission, and Values
- Creating transparency in our team and providing insight into our goals, successes, and challenges
- Engaging team members with challenging projects, career opportunities, and a voice
- Caring and trusting
Will it work? Time will tell – but we are confident in our approach.
Want to be welcomed into an environment where the name on the door today will be the name on the door next week, and the week after that and the month after that? Reach out – we are always looking for great new teammates who share our vision of what a strong mid-sized firm can be in our industry.
