Frowns Turn To Smiles In New Survey
THERE are plenty of plus points in the latest National Specialist Contractors Council state of trade survey covering the second quarter of 2014. It reveals that improved economic conditions are starting to influence tender prices and the ability to bid for work.
Flooring contractor members of the CFA were among the specialist contractors interviewed.
For the first time in the history of the survey, more respondents are being paid within 30 days than waiting more than 60 days. Furthermore, the number reporting a fall in enquiries is down to 9%, the lowest figure for more than 15 years.
The balance of specialist contractors reporting a rise in orders is 46 points, the highest since Q2 2000. And finally, none of the specialist contractors who responded to the survey anticipate a contraction of their business, whilst a seven-year high of 40% plan expansion over the next quarter.
Payment periods: When it comes to getting paid, 16% are getting their money within 30 days. It’s not a high figure, but a clear improvement on previous surveys. In contrast 71% are being paid between 30 and 60 days. However, 14% still have to wait for over 60 days.
Of concern was that of the 57% of specialist contractors reporting that they carried out public sector work in the last quarter, only 52% of those contracts was paid within 30 days. Late payment continues as a major issue facing specialist and flooring contractors.
Falling margins is a worry for 32% of respondents. However, 21% admit to increasing margins.
Capacity and workload: There was a significant rise in those reporting over 75% capacity utilisation, 84% up from 65% last quarter. Meanwhile, 43% are working at over 90% capacity up from 30%.
Market demand continues as the most important factor in terms of business planning. The availability of labour is second, followed by material costs.
A higher workload in the next quarter is forecast by 59%, while 72% anticipate workload increasing over the next 12 months.
No specialist contractors expect a contraction of their business, whilst a seven-year high of 40% plan expansion over the next quarter.
Only 5% anticipate having to reduce the size of their businesses, while 57% plan to expand their business over the next 12 months.
This article has been reproduced from the Contract Flooring Journal. You can find them at www.contractflooringjournal.co.uk.