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Building Product Sales in the UK Show Resilience

The Builders Merchants Building Index (BMBI) has recently released data confirming an ongoing and positive trend for builders’ merchants in the UK.

Compared to Q2 2016, Q2 sales for this year are up by 5.3%, although there were two more trading days in Q2 2017. Even when adjusted accordingly to include the impact of the extra two trading days, the year on year sales figure for Q2 is +1.9%.  Year to date sales results to June are up by 3.8% over last year.

The BMBI keeps track of all building product sales to contractors and builders by merchants using the Builders’ Merchant Point of Sale Tracking Data by GfK. It includes actual building product sales that exceed of 80% of the builders’ merchants’ market value.

The Q2 results seem to diverge from the trend that the Office of National Statistics reported earlier this month. The ONS reported that actual building product sales that represent construction output overall was down by 1.3% in the three months leading up to June compared with Q1. They also supposedly increased by only 1.4% on the same period in 2016. This could be a reflection of the overall predominance of housebuilding and the improvement, maintenance, and repair work completed by the customer base of these builders’ merchants.

 

Specialists in Construction Insurance

John Newcomb, the Builders Merchants Federation CEO, commented on the results while saying that most trade indicators are suggesting that order books are being filled with transactions related to private housing and repair, maintenance and improvement jobs while activity in the commercial sector is falling behind. This is evidenced by the ONS reporting a house building year on year increase of 9.4% for the entire quarter.

Mr Newcomb said that at the moment, the merchant sector is showing signs of resilience, but tougher trading conditions remain possible as 2018 draws closer.

 

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