Price inflation lifts builders’ merchants’ turnover
March 26, 2018 – Builders merchants saw an 8.4% increase in sales in January, compared to January 2017, lifted by one additional trading day.
All product categories saw sales growth (by value), especially landscaping, which was up 14.5% from last year.
Sales growth was attributed to inflationary price increases, as well as new branch openings, rather than any rise in footfall. It does not necessarily indicate any profit growth, or growth in unit volumes.
Despite this, the Builders Merchant Federation (BMF) said that the numbers buck the trends reported by the Office for National Statistics of continued construction output decline in the three-month on three-month series in January 2018. In contrast, the builders’ merchants, who supply materials to the construction industry, saw average sales a day 3.4% higher this January compared to January 2017.
The BMF figures are contained in its Builders Merchants Building Index, which tracks builders’ merchants’ sales using GfK data. The index shows strong growth over the past year, with the rolling twelve months from February 2017 to January 2018 4.9% above the same period a year earlier, with one less trading day.
The BMF has previously reported that builders’ merchants were cautiously optimistic for 2018 and beyond, and this latest data indicates confidence and a robust performance in the UK building materials supply chain.
BMF chief executive John Newcomb said: “Of course, there are challenges facing builders merchants such as continued decline in private commercial work, increases in raw material prices and product shortages. However, we are confident our members will continue to see robust growth and they are ready to work with local authorities, developers and consumers to get the right materials in the right place.”