Encon Insulation comment: Q2 2016

Mike Beard, Merchant Development Director Encon Insulation is BMBI’s Expert for Insulation Products – Distribution.

The referendum result was a shock and sterling suffered. Most forecasts predict a worsening market. House builder shares are down, but half-way through the third quarter, some house builders and merchants are reporting good markets.

Doom and gloom dominates the news but, talking to key players in construction, I see a silver lining. In Yorkshire, a large regional house builder says they’re at capacity, bolstered by a simplified planning process. I’ve learnt that a major merchant is incredibly busy with demand creating new roles and potential expansion. We won’t know until we see the Q3 BMBI report, but the mismatch between industry forecasts and market feedback is puzzling.

Theresa May’s new Government has made housing a key priority, but we can’t start cheering. We have a housing backlog and our population is the fastest growing in Europe. Large house builders are apparently gearing up to supply more, but they’ll never build the numbers Britain needs. We need to make it easier for an army of small private developers and self-builders to service this need.

That’s not easy because build numbers are comparatively small and feature more bespoke specifications. Smaller scale builders rely on expert advice from merchants to ensure they use the right product in the right way to achieve the right acoustic, thermal and fire details to meet Building Regulations.

Collectively, self-builders and small developers are a growing part of the market, but servicing their needs quickly and efficiently is a challenge. The potential range and type of insulation products for self-builds and one-off projects are wider than merchants usually stock, and staff are unlikely to be familiar with them and their applications and key features.

To ensure that they can continue to offer their customers a high level of support and service, independent builders’ merchants can utilise the technical knowledge provided by their distribution partners to help them make the most of this opportunity.

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Launched in 2015, the award winning monthly Builders Merchant Building Index (BMBI) report is the only reliable measure of repair, maintenance & improvement (RMI) activity in the UK. Filling an important gap, it can be widely used in construction, and by economists, Government, national media, commentators and influencers outside the industry.