The latest figures from the Builders Merchant Building Index (BMBI), published in January, reveal that builders’ merchants’ value sales were up +1.4% in November 2022 compared to the same month in 2021. This was inflation-led growth as volume sales tumbled -13.6% while prices climbed +17.3%.
Nine of the twelve categories sold more in November compared to the previous year. Renewables & Water Saving (+37.9%) was the standout category, while Plumbing, Heating & Electrical (+17.5%), Workwear & Safetywear (+16.6%), Decorating (+15.3%) and Kitchens & Bathrooms (+14.8%) also did relatively well. Timber & Joinery Products (-12.0%) was the weakest category.
Compared to November 2019, a more normal pre-pandemic year, total merchant value sales were +29.8% higher. Volume sales fell -4.1% while prices were up +35.3%. With one extra trading day this year, like-for-like sales were +23.9% higher. All twelve categories sold more with four outperforming Merchants overall: Renewables & Water Saving (+58.1%), Landscaping (+39.7%), Timber & Joinery Products (+33.2%) and Heavy Building Materials (+31.1%).
Total value sales in the period January to November 2022 were +7.4% higher than January to November 2021. Volume sales were -7.4% lower but prices were up +16.0%. With two less trading days this year, like-for-like sales were +8.4% higher. All bar one category sold more with Renewables & Water Saving (+30.7%) and Kitchens & Bathrooms (+19.5%) leading the pack. Plumbing, Heating & Electrical (+14.4%) and Heavy Building Materials (+12.1%) also grew more than Merchants overall. Timber & Joinery Products was the only category to sell less (-1.3%).
Compared to the same period in 2019, a more normal pre-pandemic year, year-to-date sales in 2022 were +24.4% higher. This was driven by price inflation (+29.2%) as volumes were down (-3.7%). With three less trading days in the most recent period, like-for-like sales were +26.1% higher. All categories sold more with Landscaping (+38.1%) the strongest.
Month-on-month, total merchant sales dropped slightly (-2.6%) in November compared to October. Prices went up (+4.9) but volume sales were lower (-7.2%). Despite the additional trading day in November, like-for-like sales were -7.0% down. Workwear & Safetywear (+11.2%) was the top performing category, followed by Kitchens & Bathrooms (+10.0%). Seasonal category Landscaping (-13.1%) was weakest.
Total Merchants sales in the 12 months December 2021 to November 2022 were +24.5% higher than in the same 12 months three years earlier (December 2018 to November 2019). With one less trading day in the most recent period, like-for-like sales growth was +25.0%. All categories sold more with Landscaping (+38.4%), Timber & Joinery Products (+35.8%) and Renewables & Water Saving (+34.4%) growing faster than Merchants overall. Heavy Building Materials (+22.1%), Kitchens & Bathrooms (+20.3%) and Decorating (+9.3%) grew more slowly.
Ian Doherty, Chief Executive of Hexstone and the Owlett-Jaton brand, and BMBI’s Expert for Fastener & Fixings, says: “Government delays in clarifying testing and certification requirements for the introduction of UKCA to replace CE marking has delayed many suppliers in the fastener and fixings sector from being able to introduce UKCA marked packaging.
“This delay is regrettable, and expectations that all CE marked products sold to merchants from 1st January 2023 will be UKCA marked is unlikely to be achieved.
“However, while it is an absolute requirement for new products to be UK tested and UKCA marked, existing products already on the market can continue to be sold as CE marked, and not UKCA marked, providing they were imported into the UK before 31st December 2022.
“As demand in the market has slowed in volume terms, many suppliers have seen stock levels rise. This has helped product availability recover from the lows of 2021, but these higher stocks will slow the arrival of UKCA marked product onto the market. It is quite possible that non-UKCA stock will still be moving through the extended supply chain well into 2024.
“With the current state of the economy, slowing demand in both the RM&I and new build sectors seems likely to continue. In turn, this will feed through to slowing volume demand in fasteners and fixings. Price levels seem unlikely to fall.
“Although shipping costs are falling in US Dollars, and most fasteners and fixings are imported, the weakness of Sterling has offset it to a large extent, leaving forecast value of sales still in growth.”
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.
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