The Builders Merchant Building Index

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VALUE EX VAT Index Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019
Total Builders Merchants 100 106.0 116.0 119.1 107.2 106.4 124.4 124.0 110.6 112.9 122.9 123.1 106.4
Timber & Joinery Products 100 107.1 112.3 117.1 108.1 109.5 122.9 128.3 114.7 116.7 122.8 122.4 107.4
Heavy Building Materials 100 105.7 116.9 120.7 107.9 104.9 124.2 123.5 109.9 112.0 122.2 123.0 105.0
Decorating 100 101.7 107.2 113.9 102.3 103.0 112.8 116.2 106.5 107.5 111.0 116.6 106.0
Tools 100 106.7 104.7 109.8 104.7 104.2 109.6 110.1 104.7 103.0 100.2 101.4 96.0
Workwear & Safetywear 100 108.8 95.3 100.9 110.0 110.9 97.3 100.6 110.9 103.2 98.3 105.0 117.9
Ironmongery 100 115.3 117.9 125.3 115.2 117.8 122.3 123.7 115.8 120.5 122.6 124.8 113.8
Landscaping 100 96.1 146.0 130.4 93.8 91.4 155.5 140.6 98.7 105.6 157.4 142.5 95.3
Plumbing, Heating & Electrical 100 119.9 106.0 113.4 122.7 129.5 120.1 117.2 128.1 129.2 115.8 120.1 125.8
Renewables & Water Saving 100 78.2 69.4 69.0 69.1 77.1 73.2 68.7 63.6 71.2 66.3 76.7 68.3
Kitchens & Bathrooms 100 110.6 109.6 115.2 111.6 114.6 116.3 117.6 110.6 115.9 114.8 121.4 114.6
Miscellaneous 100 115.5 112.5 120.5 111.4 113.9 115.7 112.4 110.1 116.5 116.6 127.4 115.0
Services 100 99.3 107.6 112.4 100.7 98.9 117.3 116.1 106.4 98.8 113.9 118.3 107.7

Source: GfK's Builders Merchants Total Category Report - July 2015 to December 2019

Quarterly Overview - Q4 2019

2019 will go down as one of those years most of us won’t forget, as the Brexit drama dominated headlines and created uncertainty across all spheres of business in the UK, including the Builders’ Merchant industry. Within the Builders’ Merchants this only told one part of the story, as a review of the whole year reveals the effect that weather can have.

2019 vs 2018 year to date growth sat at 6.2% after Q1, but gradually came down as the year progressed. After Q2, this growth figure dropped to 2.3% and then further down to 1.3% after Q3. We finally end the year with 2019 only seeing an increase of 0.1% against 2018, albeit having one less trading day.

So, what can the weather tell us about these decreasing growth figures? 2018 Q1 was of course dominated by the Beast from the East, with 2019 Q1 seeing more sunshine and less rainfall. This trend was however turned on its head throughout the remainder of the year. Each of the remaining 3 quarters saw less sunshine and more rain compared to the same quarter from the previous year, which has a natural effect on business within this industry.

A review of the 12 topline categories tracked by GfK makes for some interesting reading, with only 4 of these seeing a decline in value from 2018. Tools has seen the largest drop, decreasing by -6.3%, with Heavy Building Materials, Timber & Joinery and Plumbing, Heating & Electrical the other showing negative growth.

Heavy Building Materials and Timber & Joinery, as the core categories, saw decreases of -0.1% and -1.0% respectively. Within Heavy Building Materials there have been small declines in most key areas such as Bricks, Blocks, Roofing and Aggregates, with Plaster & Plasterboards the big winner in the past year. Both Timber and Sheet Materials saw declines within the Timber & Joinery category, with Cladding and Flooring the areas with the most positive growth.

2020 brings a new decade full of opportunities and challenges, but it should be a relief that Brexit won’t be part of the public discourse for much longer. Storms Ciara and Dennis have just passed and could be a further indication of the increased erratic weather seen across the UK. Looking ahead in 2020 it will be interesting to see what role weather will play in the Builders’ Merchants industry and how it will affect growth as the year moves along.

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