Builders’ merchants’ sales up

June’s Builders Merchant Building Index (BMBI) showed builders’ merchants’ sales to roofers, builders and contractors were up 3.7% in June 2017 compared with the same month last year.

Total sales in the second quarter were 1.9% ahead of the same three months in 2016. Timber & Joinery Products did better (+2.6%). With two fewer trading days this year, average sales per day for merchants generally in Q2 were 5.3% higher.

The first six months of 2017 were 3.8% ahead of the same period in 2016, with Timber & Joinery Products (+4.6%) and Heavy Building Materials (+4.1%) both doing better. The rolling 12 month period, July 2016 to June 2017, was 4.2% ahead of the same period a year earlier.

The BMBI index for June was 120.2 (113.4 adjusted for trading days) with all but two categories having indices over 100. The index for Quarter 2 was 116.0 (118.4 adjusted for trading days).

Steve Durdant-Hollamby, Managing Director Alumasc Water Management Solutions, BMBI’s Expert for Civils, Metal Rainwater & Drainage says: Taking material cost inflation into account, the market for metal rainwater, civil and drainage markets was a few percentage points up in value in Quarter 2, but volume was flat. The surprising results of the election shook market confidence, delaying large projects, with smaller orders making up the shortfall.

Housing and commercial markets continue to do well, but the uncertainty in the market is causing civils projects to be put on hold or shelved. Opportunities lie in bespoke manufacturing and factory-fit solutions where we’re seeing strong and growing demand, particularly from large contractors. This is driven by the skills shortage and the creativity in design and architecture.

The Grenfell disaster has shaken our industry in more ways than one. We believe it will lead to closer investigation of fire resistant products and better policing from testing to installation. It will also lead to specifiers favouring construction materials such as metal over plastic. Already we’ve seen increased interest in BBA approvals within our paint plant and metal rainwater systems.

Although Quarter 2 was flat, July was busy and the market is still growing so with that in mind and considering the current uncertainty, we expect Quarter 3 to grow a cautious 2-3%.

BMBI Experts speak exclusively for their markets, explaining trends, issues and opportunities.