In November, both South West and South East (Southern Counties) Area Boards met online. Here are 12 key findings from our board members on the state of trade in the southern region are:
- Material delays continue to be counted in weeks.
- Concerns that the latest Covid variant may trigger more lockdowns on mainland Europe and further affect supply chains.
- Prices have drastically increased this year but appear to have stabilised for now.
- Hiring staff continues to be a problem with someday rates as much as £450/day.
- Operational overheads (e.g. fuel) are putting real pressure on margins.
- Some building firms are pulling out of contracts where there is no margin left.
- Long term projects are the ones at most risk of price erosion.
- Clients are increasingly demanding and expecting results in unrealistically short timescales.
- A high level of enquiries does, however, give a chance for building firms to be more choosy.
- Quality/reliability of some materials has reduced over the past two quarters, e.g. warping timber, poorly-assembled items, e.g. glazing units.
- Some evidence from estate agents that the residential market could be cooling in Q1 2022.
- Clients are more inclined now to discuss variation clauses on contracts due to materials and labour cost changes. You can visit our Building materials page, where you'll find resources including contract templates, letters for clients explaining material price rises as well as webinars and blogs to help you reduce the impact of materials shortages on your business.
If you have any questions about the board meeting or would like to know how to become more involved with FMB policy work, please contact [email protected].