Price inflation remains the biggest issue for industry

Price inflation remains the biggest issue for industry

The Bank of England has increased interest rates to 2.25%, their highest level since 2008, and ‘will not hesitate’ to raise them further to reach its target of 2% inflation. Inflation remains high at 9.9% and the latest statement from the CLC Product Availability Group confirms it is still the ‘biggest issue’ for the industry.

It is most recent strategy, CLC outlines the four priorities to transform construction ‐ Net Zero and Biodiversity, Next Generation Delivery, Building Safety, and People and Skills ‐ as well as more immediate challenges, including inflation, forward pipeline, and business sustainability.

CPA provides economic update

CPA provides economic update

THe CPA has produced an economic update which details

  • the CBI’s Industrial Trends Survey for the three months to September.
  • ONS figues for public sector net borrowing
  • Housing including the number of property transactions in the UK for August; and
  • The CPA’s analysis of the Chancellor’s Growth Plan 2022 – highlighting key policies affecting construction

FIS members can access the full information here (scroll to Weekly Notes – 23 September 2022)

 

 

CPA releases UK Economic and Construction Update

CPA releases UK Economic and Construction Update

The latest weekly update from CPA is available to members here.  The updated issues are in Pages 1-6 of the weekly update whilst subsequent pages have existing data and information that remain relevant. This update includes:

  1. UK Government Energy Price Guarantee (September 2022)
  2. S&P Global/CIPS UK Construction PMI (August 2022)
  3. ONS Building Materials Prices (July 2022)
  4. Barratt Developments Annual Results (September 2022)
  5. Vistry Group Half-year Results (September 2022)

    Market Data

    FIS has access to a wide range of market data from sources including the CPA, Barbour ABI and Builders’ Conference. In addition, FIS produces a state of trade survey specifically for the finishes and interiors sector.

    Cost pressures dominate a mixed quarter

    Cost pressures dominate a mixed quarter

    There were signs that the extended period of growth experienced by the construction supply chain began to ease in the second quarter of 2022, with cost inflation dominating the headlines of industry surveys. Whilst net balances for construction product manufacturers’ sales and SME contractors’ workloads continued to show growth, they were the lowest since 2020 Q4 and were accompanied by product manufacturers anticipating a fall in sales over the next 12 months and SMEs reporting that enquiries slowed significantly from recent quarters, including falls for new house building and the industrial and commercial sectors

    Access the full report here

    Members can access the full report, produced by the Construction Products Association.

    CPA releases UK Economic and Construction Update

    July data indicated an overall rise in new orders for 26th consecutive month

    The latest weekly update from CPA is available to members here. The updated issues are in Pages 1-6 of the weekly update whilst subsequent pages have existing data and information that remain relevant. This update includes:

    1. Bank of England Monetary Policy Report (August 2022)
    2. S&P Global/CIPS UK Construction PMI (July 2022)
    3. ONS UK Construction Materials Prices (June 2022)
    4. ONS Construction Employment by Age-Demographic (2022 Q1)
    5. ONS Construction Employment by Gender and Occupation (2022 Q1)
    6. Taylor Wimpey Half Year Results (August 2022)

      Market Data

      FIS has access to a wide range of market data from sources including the CPA, Barbour ABI and Builders’ Conference. In addition, FIS produces a state of trade survey specifically for the finishes and interiors sector.

      Build UK members maintain payment performance

      Build UK members maintain payment performance

      The latest results published under the Duty to Report on Payment Practices and Performance show that Build UK members have maintained their payment performance over the last six months, despite the significant pressures caused by rising inflation. Contractor members are now reporting an average of 31 days to pay invoices, down from 32 days at the start of this year and 45 days when the Build UK table was first published in July 2018. On average, they are paying 94% of invoices within 60 days, up from 82% four years ago.

      Commenting on the figures, FIS CEO Iain McIlwee said:

      “On the surface this is encouraging, but we do have to dig behind the numbers.  Here we are simply measure the time lag from invoice being raised to invoice being paid.  In the modern digital world, there are few excuses for being late.  If we look past the numbers we are still seeing applications for payment disputed to slow down the invoice, pressure to accept long payment terms, discounts to pay on time and worse tenders being scattered to trap the unsuspecting in suicide bidding in order to meet unsustainable pricing.  These are challenging conditions and the whole supply chain needs to react – some are, but in parts of the market there is little empathy and support for the SMEs in the supply chain.”

      Build UK’s payment performance table features more than 100 of the industry’s largest companies, including contractors, clients and housebuilders, to provide a comprehensive picture of payment practices across the construction industry.

      All the latest business news can be found in Build UK’s Improving Business Performance update.

      FIS is doing some research into procurement – have you say in how tendering, procurement and contractual practices are impacting our market