Reds10 chair: Searching for the Holy Grail of productivity

Reds10 chairman Paul Ruddick is on a mission to make modular work better for everyone

Offsite production could enable the construction industry to crack its productivity problem – but getting it off the ground has proven easier said than done, given the string of business failures in the sector over the past two years.

In stark contrast, London-based Reds10 boasted a 70 per cent increase in turnover in its latest accounts, and its chairman and co-founder Paul Ruddick’s vision is to grow into a tier one contractor.

“The construction industry is ripe for productivity improvements, and we want to be at the forefront of that revolution”

Paul Ruddick, Reds10

Speaking to Construction News, he says a £1bn annual turnover is possible if the volumetric modular firm can find the “Holy Grail” of better productivity.

“Our ambition is to become a true industry leader,” Ruddick says. “Not just for growth’s sake, but because at that size, we can really effect change. The construction industry is ripe for productivity improvements, and we want to be at the forefront of that revolution.”

Reds10’s turnover has quadrupled in the past three years and risen sevenfold since 2020. While this year saw a deliberate slowdown to consolidate operations, Ruddick says that company revenue is still set to exceed £150m in 2025.

A predictable pipeline of work via public sector education, defence and justice programmes is the main reason behind the firm’s fast rise. For example, last August it won a place on the Defence Infrastructure Organisation’s (DIO) six-year £2bn accommodation alliance for the British Armed Forces.

As part of this alliance, the firm is delivering four new modular accommodation blocks at RAF Marham in Norfolk, with the first set to complete early this year.

Ruddick sees room for improvement in how Whitehall engages with modern methods of construction (MMC). “We need policies that not only promote MMC but also ensure clients understand its benefits and how to implement it effectively.”

Wider government policy is also not always beneficial. Ruddick describes this April’s pending rise in employer National Insurance as “a big hit to us, but as an industry we’ve got to get on with it”.

DIO-related residential work, which includes Imjin Barracks in Gloucester for the British Army, reflects Reds10’s evolving business strategy as it seeks to diversify its market presence.

Ruddick expects Reds10 to grow further into the residential market, driven in part by the government’s target of 1.5 million new homes being built during the current parliament.

“Relying on one income stream is risky,” Ruddick says. “Having a range of sectors helps smooth out the peaks and troughs.”

However, he is conscious of the potential pitfalls for modular housebuilders. “The demand for social housing presents a tremendous opportunity,” he notes. “We believe volumetric construction can be the answer, but it’s about delivering a product that’s cost-effective and high-quality. The industry has been burned by cases where modular hasn’t worked. A lot of competitors went big really quickly, but unfortunately they didn’t have the pipeline or product in place.

“But there have been far more failures in traditional construction. The difference is no one is calling for traditional methods to stop. Our mission is to demonstrate that modular can succeed.”

Reds10 follows a vertically integrated method with fully in-house design to cut delays and waste. Blending technology with offsite production methods can break down silos between clients, designers, contractors and tradespeople, Ruddick says.

At the heart of Reds10’s strategy is its 27,900 square-metre complex of five factories in Driffield, Yorkshire. Ruddick says he is confident that with enhanced productivity, these facilities could generate up to £500m of revenue annually without requiring further expansion. But the broader construction industry must also change its mindset to properly embrace industrialisation, he adds.

“Construction is the only major industry that missed the Industrial Revolution. Our goal is to change that by applying principles of industrialisation and repeatability, similar to the production line in a car factory. I passionately believe that we’ve got the ingredients to improve productivity – the Holy Grail for our industry.

“Everyone talks about automation, robots and AI but I say ‘no, we haven’t even industrialised yet. Let’s do that first and then move into automation’.”

Reds10’s aim is to tackle the 20 per cent of waste that Ruddick says characterises traditional methods. By focusing on upfront design, digital tools, and industrialised processes, the contractor aims to eliminate rework and inefficiency.

“Main contractors want to bear down on cost because they’re lucky to make 2 per cent margin,” he notes. “But why isn’t everyone looking at their business model and going after the waste?”