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Negative growth in Q4 rounds off disappointing year, says BMBI

By February 25, 2020 No Comments

Sales figures for the final quarter of 2019 round off a disappointing year for the builders’ merchant sector, with a third consecutive quarter of negative growth. This is according to the latest figures from the Builders Merchants Building Index (BMBI).

While there were six less trading days in Q4 compared with Q3 2019, a comparison of average sales per day for the two periods shows a decline of -5.2% in total builders’ merchants’ sales in Q4.

Comparing Q4 year-on-year also saw a decline in sales. Q4 2019 had one less trading day than Q4 2018, and year-on-year average daily sales were down -2.4%.  Within this, the largest category, Heavy Building Materials, was down by -3.0%, Timber & Joinery by -5.2%, Landscaping by -1.9% and Plumbing Heating & Electrical by -0.7%. A few categories did see sales increase, for example, Kitchen & Bathrooms rose by +4.7%, Renewables & Water Saving by +8.2%, and Workwear & Safetywear by +7.6%.

The BMBI uses the GfK’s point-of-sale tracking data drawn from over 80% of builders’ merchants’ sales throughout the country.

Taking 2019 as a whole, builders’ merchants experienced marginal growth of +0.1% against 2018, albeit having one less trading day this year.

A review of the 12 topline categories tracked by GfK shows that four of these saw a decline in value when compared with 2018. Tools has seen the largest drop, decreasing by -6.3%, with Heavy Building Material (-0.1%), Timber & Joinery (-1.0%) and Plumbing, Heating & Electrical (-0.3%), also showing negative growth.

Emile van der Ryst, senior client insight manager of trade at GfK, said: “Within the core categories, Heavy Building Materials reported small declines in most key areas such as Bricks, Blocks, Roofing and Aggregates, with Plasters & 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.”

John Newcomb, BMF chief executive officer, said: “The Q4 2019 didn’t give builders’ merchants much to cheer about and the same can be said for the year as a whole. The Brexit drama dominated headlines and created uncertainty across all spheres of business in the UK, including the builders’ merchant industry. Differing weather events in 2019 vs 2018 also played a part. Looking forward, Q1 2020 could bring another bumpy ride. Word on the merchant grapevine is that January trading was more positive, but with Storms Ciara and Dennis in February, we are unlikely to see a Boris Bounce just yet.”