When a craft business wants to grow but can't

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Doors, stairs, kitchens, furniture, repairs – but the Bichler joinery also offers a funeral service. It was a conscious decision for the craft business to diversify – but a necessary one in view of the shrinking margins.

Lëtzebuerger Journal: Patrick Bichler, can you briefly introduce your company?

Our joinery business, which is currently located in Remich, currently employs 14 people. There's nothing we don't do. We have made it our mission not to have to tell customers: We don't do this or that. That's why we never get bored.

Is it a family business?

No, I bought the company from the previous owner in 2017. At the time, the business was kind of floundering, if I may say so myself. But we've managed to put it on a solid footing since then. When I took over the business, there were four employees and, as I said, there are now fourteen of us.

And could it one day become a family business?

We are a family with two children. We are expecting the third in October. I don't know yet whether they will take over the company one day. But I am convinced that a lot can be done to pass on this task to the children in a positive way.

In recent years, we have heard that joineries have increasingly had to struggle with difficulties. How do you see this?

Of course, I can only speak for my company. We mainly work in renovation. This means that you have to master your craft, that details and clean workmanship are important. And I think that perhaps sets us apart from others to some extent: We can go straight to the customer, [do the work] and afterwards nobody has to come round to touch up or put things right.

As far as the economic situation is concerned, I have to say that we have lost some of our margin in recent years. The days of having a good profit left over at the end of a project are over. We now have to actively look for ways to become more profitable again so that we can afford to make bigger leaps. What did someone once say? "Et wäert dach mol nach erlaabt sinn, e Su ze verdéngen" (It should allowed to make a buck every once in a while).

Because if I want to build a new workshop, I have to be able to repay the loan to the bank. To do this, however, I must first be able to find a plot of land on which I can build.

Before I come back to this point: What is the reason for the fall in margins? Material prices, the construction crisis?

Many suppliers have increased their prices and hidden costs are popping up everywhere, a dealer fee here, an eco levy there. Our challenge is that we have to look for ways to pass on these additional costs.

That's something you don't get told when you want to start your own business. Everyone says: We'll help you. But the opposite is actually true. Everyone is looking to see how they can get a slice of the cake or make life more difficult for the other person. That's what we're struggling with.

Why do you want to move and how long have you been looking for a suitable location?

I set myself this goal when I took over the business, because it was clear that this location (in the centre of a residential area in Remich, ed.) would not be suitable forever.

About three years ago, I had an appointment with the mayor, but he told us that the municipality couldn't offer us anything. He referred us to the inter-municipal syndicate SIAER, in which Remich is represented, and which operates the Le triangle vert industrial estate, which was, however, fully utilised at the time. In other words: We were unlucky.

Nevertheless, we endeavoured to submit a candidacy because we knew that the business park might be expanded.

How long ago was that?

It's certainly been three years since we submitted our candidature. There were national elections in between. With the new government, the concept for the expansion of the business park changed again and with it the regulations, so we had to submit a new application.

As things stand, our dossier is still being analysed. So far, no company has received a commitment, but there have already been cancellations. I am therefore still confident of being able to build a new studio in Ellange.

I can only commission an architect to plan the building once I have been accepted for a plot and I know how many acres I have available. I can then apply to a construction company for a cost estimate, which I can then use to ask the bank whether it is prepared to work with me on this project.

Chosing your location is certainly one of the most pivotal decisions a business has to make?

Yes, and it's a question of cost. With today's prices, you have to be able to afford to build a new workshop.

If I start a project worth three million euros – I'm just going to put this figure out there – and have to pay 15,000 euros a month back to the bank, then these 15,000 euros have to be left over at the end of the month.

And our employees also want to earn enough to feed their families and lead the life they want.

In concrete terms, does setting up in an industrial estate mean that the company pays for the construction and also a lease for the land?

Yes, it is a leasehold contract (bail emphytéotique), which means that I rent the land for 20 or 25 years and pay a one-off amount for it. This contract can of course be renewed.

But you will have to be patient until then..

It was clear from the outset that the expansion of an industrial estate could take ten or twenty years. According to the latest information I have heard, agreements have been reached with all the landowners, which would be a good sign. However, there are still no excavators on the site.

We'll have to keep fighting our way through for so long, with little space and ever new conditions. Everyone says: you have to do this, you have to do that. But nobody tells us how (laughs).

You've said you want to leave this residential area. But you also hear that the municipalities want to get businesses out of the villages. Do you have the same impression?

I've heard in a roundabout way that businesses that have settled in a town are allowed to stay there, but only as long as they don't expand or carry out modernisation work.

I have a lot of walk-in customers, people from the neighbourhood who bring a chair for gluing on foot. If I move to an industrial area now, then the journey to the recycling centre might be shorter for some people.

A look at the region shows: All the surrounding industrial estates such as Mertert or Grevenmacher have now reached their capacity limits. Why is it important for your company to remain anchored in the region?

Wormeldange too.

I grew up in Ellange, I played soccer in Remich for many years and was a scout. So I'm from here and have the majority of my customers here. So it's normal to want to stay in the region.

When do you hope to move into the new building at the latest?

When I took over the business in 2017, I said to myself: I have to have a new building in ten years. So that would be 2027. I think that will be a bit tight… We would be lucky if we could start construction within the next three to five years.

The government says: We need to become more competitive, the economy is not turning properly. On the other hand, there are many craft businesses that, although they are repeatedly described by politicians as the backbone of the economy, to use a hackneyed phrase, are lagging behind their potential: Because there is a lack of capacity in many business parks, they cannot expand and therefore cannot realise their business plan. Has politics failed on this point?

I think it's a question of priorities. I don't know if the skilled trades are really at the top of the government's list of priorities. And that is precisely why I believe we are "only" the backbone – but not the driving force, if I may say so.

And I also don't know whether any government – no matter which one – really sees us as part of the future. I rather have the impression that a lot of energy and resources are being channelled into start-ups. But there is also potential in the skilled trades, which are said to be increasingly disappearing because nobody wants to practise them. This is being forgotten to some extent.

And yes, it is true that we have a space problem here in Luxembourg. That's nothing new. And I think it's also a cross-party issue for which there is currently no clear solution. But there have also been projects in the past – without naming names – that have faced many obstacles (which have not progressed due to environmental regulations, according to Bichler ed.).

Isn't this lack of planning damaging to business?

I don't know if "damaging to business" applies, but it is slowing us down. We want to, but we can't. I don't want to blame anyone, and I don't know who. But I know that projects like this take time. I think it's normal that landowners want to get the highest possible price, but the state is not necessarily willing to pay any price. The government is part of the puzzle, but so is society.

What about the next generation of skilled workers?

I have resolved to support young people who want to learn the carpentry trade. I don't come from a family of craftsmen myself. Nevertheless, my family and my parents have supported me on this path. That's why I see it as my duty to pass on this knowledge.

However, you also have to emphasise that training is expensive. You have to take your time. The question then arises as to whether a young Luxembourger who starts an apprenticeship will stay with the company in the long term. I have my doubts about that.

Are you saying that young people are more likely to be drawn to the public sector?

That's quite clear. They don't even make a secret of it any more. I had someone who told me: I want to work for them. I trained as a carpenter, but I have to work in the private sector for two years before I can take the police entrance exam.

In plain language: there is a lack of young people who want to learn the carpentry trade in order to stay in this profession.

Definitely. We're still coping with the situation. But we could definitely receive more applications if we advertised vacancies.

What would you like to see? How could the skilled trades be better supported?

A kind of stock exchange for free or vacant properties in industrial estates would be useful. Companies could call the Chamber of Skilled Crafts to find out where there are opportunities. That would relieve the burden on businesses because they wouldn't have to pick up the phone themselves and scour industrial estate after industrial estate.

After all, we shouldn't lose sight of the fact that we don't come to work every day to think about the future of the business. We come to work every day to work for our customers.