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Materials’ price rise squeezes SME builders

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Price up: Building material price is harming SMEs

MORE THAN half of small building firms say that rising material prices are squeezing their margins and the same percentage have had to pass these price increases onto consumers, according to the latest research by the Federation of Master Builders (FMB).

Small and medium-sized (SME) building firms were asked which materials are in shortest supply and have the longest wait times. The average results were as follows (in order of longest to shortest wait times):

  1. Bricks were in shortest supply with the longest reported wait time being more than one year;
  2. Roof tiles were second with the longest reported wait time being up to six months;
  3. Insulation was third with the longest reported wait time being up to four months;
  4. Slate was fourth with the longest reported wait time being up to six months;
  5. Windows were fifth with the longest reported wait time being more than one year;
  6. Blocks were sixth with the longest reported wait time being up to four months;
  7. Porcelain products were seventh with the longest reported wait time being more than one year;
  8. Plasterboard was eighth with the longest reported wait time being up to two months;
  9. Timber was ninth with the longest reported wait time being up to two months;
  10. Boilers were tenth, with the longest reported wait time being more than one year.

SME building firms were also asked by what percentage different materials have increased over the past 12 months. On average, the following rises were reported:

  • Insulation increased by 16%;
  • Bricks increased by 9%;
  • Timber increased by 8%;
  • Roof tiles increased by 8%;
  • Slate increased by 8%;
  • Windows increased by 7%;
  • Blocks increased by 7%;
  • Plasterboard increased by 7%;
  • Boilers increased by 7%;
  • Porcelain products increased by 6%.

The impact of these material price increases includes:

  • More than half of construction SMEs (56%) have had their margins squeezed, this has gone up from one third (32%) reporting this in July 2017;
  • Half of firms (49%) have been forced to pass material price increases onto their clients, making building projects more expensive for consumers, this has gone up from less than one quarter (22%) reporting this in July 2017;
  • A third of firms (30%) have recommended that clients use alternative materials or products to those originally specified, this has gone up from one in ten reporting this in July 2017;
  • Nearly one fifth (17%) of builders report making losses on their building projects due to material price increases, this has gone up from one in ten reporting this in July 2017.

Brian Berry, Chief Executive of the FMB, said: “Material prices have rocketed over the past year. The reason for this could include the impact of the depreciation of sterling following the EU referendum still feeding through. High demand due to buoyant international markets could also be contributing to price increases. What’s particularly worrying is that when prices have increased mid-project, almost one fifth of builders have absorbed the increase and therefore made a loss. Also, if material price increases weren’t enough of a headache for building firms, they are also experiencing material shortages with wait times ticking up across a range of materials and products. Worst case scenarios include firms waiting for more than one year for a new order of bricks.”

Berry continued: “The rise in material prices is not just a problem for the country’s construction firms – it is also a problem for home owners. Half of firms have been forced to pass these price increases onto their clients, meaning building projects are becoming more and more expensive. This problem has worsened recently with more than twice as many firms passing material prices on to their clients now compared with nine months ago. What’s more, home owners should be prepared to have to use alternative materials or products to their first choice. One third of firms have recommended that their clients should use alternative materials or products to those originally specified. Now more than ever, it’s important that builders and their clients keep the lines of communication open in order to stay within time and within budget. Specified products or materials may need to be swapped for alternatives or clients will need to accept the additional cost.”

Berry concluded: “We are calling on builders merchants to give their customers as much advance warning of forthcoming material price increases or wait times as possible so that firms can warn their customers and plan ahead. We are also advising builders to price jobs and draft contracts with these material price rises in mind. The FMB’s latest State of Trade Survey shows that almost ninety per cent of building firms are expecting further rises over the next sixth months. This makes quoting for jobs difficult but if builders flag the issue to their client from the outset, and include a note in the contract that prices may be subject to increases, they shouldn’t be left short. What we don’t want is for the number of building firms making losses on projects to increase as this could result in firms going to the wall. A large number of collapsing construction companies will have a terrible knock-on effect in the wider economy.”

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Pupils at Ysgol Gyfun Aberaeron asked to self-isolate as COVID-19 case confirmed

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A NUMBER of pupils at Ysgol Gyfun Aberaeron have been asked to self-isolate for 10 days following the confirmation of a COVID-19 case at the school.

All confirmed contacts of the positive case must remain at home for 10 days to reduce the possible spread of the virus to family, friends and the wider community. The pupils will be taught remotely for this period. The parents of all these pupils have been contacted by the School.

The Council urges all parents to refer their children for a test if they develop any of the symptoms, which are:

  • a high temperature
  • a new continuous cough
  • a loss or change to sense of smell or taste.

Parents should also be aware of other symptoms early on, such as headaches, tiredness and general aches and pains usually associated with the flu.

Although the level of cases is low, coronavirus has not gone away. Please follow the guidelines:

  • Keep a 2m social distance from each other when out and about – indoors and outdoors;
  • Wash your hands regularly;
  • Wear a face mask in indoor public places, shops and on public transport.

You can apply for a test on https://gov.wales/apply-coronavirus-covid-19-test or by phoning 119.

No further details will be provided regarding this matter.

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Business

Update for Multi-purpose Community Centres following First Minister announcement

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TODAY, First Minister Mark Drakeford announced that multi-purpose community centres including community centres, village halls, church halls and other community facilities can reopen from 03 May. This decision has been brought forward from 17 May.

Welsh Government announced changes during today’s briefing, and the guidance for multi-purpose community venues is being updated to ensure compliance with developments in regulations, including greater emphasis on ventilation. Welsh Government continue to advise authorities that the regulations on social gathering will still prevent a number of activities from taking place at community venues, and only organised activities for up to 15 people will be permitted.

The panel strongly advise you to make every effort to carry out your activity digitally or make contact by phone. If not, consider whether it is possible to hold your activity outdoors, in-line with Welsh Government guidance. Holding your activity indoors should be considered as a last resort. If this is the only option and it’s essential that you meet then please keep the session brief and involve as few people as possible, with all necessary procedures and protocols in place.

Those responsible for community activities should remember to;

  • maintain a social distance of 2 meters.
  • wear a face covering in indoor public spaces.
  • regularly wash your hands for 20 seconds or use hand sanitizer provided.   

A multi-agency panel has been set up to advise and support around the safe and proportionate reopening of facilities in-line with national guidance. The panel has been created under Ceredigion’s Public Services Board Sub Group; Understanding our Communities. Leading on the development of the group is Ceredigion Association of Voluntary Organisations (CAVO) and Ceredigion County Council in partnership with Heddlu Dyfed Powys Police and Mid and West Wales Fire and Rescue Service. The panel includes representation from Health & Safety, Environmental Health and Community Safety.

The panel encourages anyone responsible for community facilities to seek advice to ensure that arrangements are safe and secure and that compliance is in-line with national guidance. Prior to re-opening any community facility those managing centres must ensure that they are ‘Covid-Free Zones’.

The panel will aim to host another briefing session on April 28 at 13:30 to support those in charge of community venues with the latest developments. If you would like to join the next briefing session, please register here: https://www.eventbrite.co.uk/e/cyfleusterau-cymunedol-ceredigion-community-facilities-information-session-tickets-152071456821?aff=ebdssbonlinesearch or get in touch via the contact details below.

The multi-agency panel will continue to support and advise Community Groups and Organisations, and questions or information requests can be submitted to the group which meets on a weekly basis via CAVO on gen@cavo.org.uk or by phone on 01570 423232.

Together, we can keep Ceredigion safe.

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Business

First Minister to set out first steps out of lockdown

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THE WELSH GOVERNMENT will lift the “stay at home” requirement in Wales from tomorrow, and replace it with “stay local”, as part of a careful, cautious and phased approach to relaxing coronavirus restrictions, First Minister Mark Drakeford will announce today (Friday, Mar 12).

From tomorrow (Saturday, Mar 13), four people from two households will be able to meet outdoors to socialise, including in gardens. In addition, outdoor sports facilities, including basketball courts, tennis courts and golf courses, can reopen, and indoor care home visits will restart, for single designated visitors.

From Monday, all primary pupils and those in qualifications years will return. Schools will have the flexibility to bring year 10 and 12 learners back and more learners will return to colleges.

There will also be flexibility for in-school check-ins for all other pupils. All learners will return after the Easter break.

Hairdressers and barbers will re-open for appointments from Monday.

From 22 March non-essential retail will start re-opening gradually as the restrictions are lifted on what can be sold in shops which are currently open. Garden centres will also be able to open. All shops, including all close contact services, will be able to open from 12 April – the same date as in England.

The First Minister will say: “We are taking a phased approach to unlocking each sector – starting with schools. We will make step-by-step changes each week to gradually restore freedoms. We will monitor each change we make, so we know what impact each change has had on Wales’ public health situation.”

The First Minister will also announce an additional £150m to support businesses affected by ongoing restrictions.

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