The latest total value sales data from Britain’s Builders’ Merchants recorded the third-highest quarterly BMBI sales ever, rounding off a record-breaking year for merchants. However, with growth driven exclusively by pricing – not volume – the figures suggest the 2021 trade boom has inevitably slowed.
Quarterly sales, Year-on-Year
Total value sales to builders and contractors in Q4 2021 were 14.7% higher than Q4 2020, with no difference in trading days. All categories sold more. Timber & Joinery Products was out in front (+28.2%), follow by Landscaping (+14.4%) which recorded its highest quarterly sales of the year. Heavy Building Materials (+11.1%), Kitchens & Bathrooms (+10.0%) and Plumbing, Heating & Electrical (+9.6%) grew more slowly.
Comparing Q4 2021 with Q4 2019, a more normal pre-COVID year, total value sales were 21.0% higher this year, with the benefit of one more trading day. Nine of the twelve categories sold more, including Timber & Joinery Products (+44.4%) and Landscaping (+40.6%) which were well ahead of the other categories. Like-for-like sales were up 18.9%.
Quarter-on-quarter, sales were down 12.7% in Q4 compared to Q3, not helped by four less trading days in the most recent period. Only Workwear & Safetywear (+15.3%) and Plumbing Heating & Electrical (+9.0%) sold more. Like-for-like sales were 6.9% lower than in Q3.
December sales, Year-on-Year
Compared to December 2020, when large parts of the country were subject to tiered COVID restrictions, total sales were up 16.3% in December 2021 with no difference in trading days. All categories sold more, as Timber & Joinery Products (+25.0%) and Landscaping (+18.8%) again finished ahead of the rest.
Total value sales in December 2021 were also 26.5% higher than the same month two years ago, helped by two more trading days this year. Timber & Joinery Products (+50.4%) and Landscaping (+48.6%) significantly out-performed the others.
December sales, Month-on-Month
Total merchant sales in December were significantly down compared to November 2021 (-33.0%), with five less trading days. This impacted the overall Q4 results. However, the decline in sales between November and December is in line with previous years’ results.
Overall sales in the 12 months from January to December 2021 were 30.5% higher than in the same 12 months a year earlier, with two less trading days this year. All categories sold more. Again, Timber & Joinery Products (+52.1%) was the year’s standout-category, with Landscaping (+31.3%) also doing better than merchants overall.
Other categories doing particularly well included Kitchens & Bathrooms (+24.0%), Heavy Building Materials (+24.0%) and Plumbing Heating & Electrical (+23.5%).
Clark McAllister, Sales Director Polypipe Civils and BMBI’s Expert for Civils & Green Urbanisation, comments:
“The Christmas break was a timely and much needed circuit-breaker from the challenges of 2021. Those challenges have not magically disappeared, far from it, but it was an opportunity to take breath and consider how we move forward into 2022.
“The upstream supply uncertainties throughout the second half of 2021 remain equally volatile, making the implementation of accurate strategic plans and effective operational decisions far from easy.
“With demand staying relatively firm, albeit with expected seasonal variation, and forecasts of price fluctuations combined with interest rate rises and a squeeze on the cost of living, we could see volumes fall back in some sectors.
“In contrast, infrastructure and green urbanisation activity is set to see continued strong growth led by projects such as HS2 and legislative drivers such as the Environment Act.
“The Environment Act’s requirements for developments to achieve a net-gain uplift in biodiversity will transform our urban landscape and deliver a wealth of multi-functional benefits for communities and the environment. We will be watching carefully to see what targets will be introduced this year to improve nature, air and water quality.
“For manufacturers such as ourselves serving these sectors, the continuing challenge is to maintain a consistent level of service while mitigating, as far as we can, the impacts of material constraints and price instability.
“Perhaps it’s too early to say that we are now through the worst of COVID-19. Let’s hope we are. Its legacy, however, is more structural and permanent. The workplace is now more flexible, connected and dynamic.
“New practices shaped by technology are changing perceptions and expectations of the next generation. If the construction industry is to attract and build the skilled and engaged workforce it needs, we must embrace this opportunity to innovate.
“That said, on a very human level, it is good to see face-to-face meetings making a welcome return. Technology is a great enabler but there is no substitute for direct contact with colleagues and customers. Good construction, after all, thrives off building good relationships.”
BMBI Experts speak exclusively for their markets, explaining trends, issues and opportunities. For the latest reports, Expert comments and Round Table videos, visit www.bmbi.co.uk.
This column was published on www.buildingtalk.com on 24th February 2022.