Sat on a train from Cheltenham to Leeds, I thought I would share my thoughts on the events of 2010. The year began with great uncertainty as projects planned for quarter one and two were placed on hold and quickly reduced in number. The project "bank" was at its lowest for over 15 years. On existing projects, poor weather conditions at the start of the year also caused massive delays for businesses across the supply chain, inevitably increasing the amount of pressure to complete across a shorter time scale.
Investors awaited financial clarity as the general election beckoned. Money was there to invest but the environment was far too uncertain and high risk to take chances. Demand for warehouses and distribution centres was at a record low.
The slow start to the year was quickly followed by a more productive quarter two and further improvements in project starts and tenders in quarter three. Activity started to reflect at least budget levels, but big projects were still being put on hold. Following the general election, we found that project delays began to reduce and the industry as a whole got back on track. It was good to see many large projects being kick-started and although there will be cut backs within the PFI sector, this will not be significant until 2012. And all of this as revisions to Part L of the Building Regulations were again implemented on 1st October.
Against these many challenges, it was pleasing to see so many lead specialist contractors and manufacturers survive through the year. There is now a more constant stream of work moving into 2011, in comparison with the latter end of 2010. We are all coming to terms with the implications of the revisions to the Building Regulations with further changes to airtightness specifications and an increase in ‘built’ costs, to name but a few. We can all draw positives on this as the stricter guidelines mean the assurance that a building will be airtight, now holds more ‘weight’ with clients and architects.
Post recession, manufacturers which have experienced the "innovate or die" conundrum have thrown themselves feet first into the development of new products, bringing exciting new innovations such as the TIA mechanical fix for easy tapered installation, to the fore. In addition, we have seen an increase in the number of quotes and tenders being completed by contractors, but they continue to face challenges on price levels. The good news is that work is being won but at barely above overhead recovery levels. Any profit to be had is very small as the building procurement process differentiates the simplest way it can - ever lower prices.
At SFS intec, we haven’t just sat by and watched this happen but looked to see how we can help. Never before have application and fastener solutions that truly take cost out of the build been more needed. Building in the same way as last year, accepting an even lower price for the same products and services, may result in business failure. I fear many will still experience this next year.
SFS intec and a number of our partner system manufacturers are, and have brought to market, innovative products and services that bring real in-place cost savings compared to thinking and doing things the way we ‘always’ have. ‘Game’ changing product design now exists, allowing the enlightened contractor to move with the times with reduced risk. For example, the modern and high performance thread design of the New Generation SX fastener maximised in design with secondary steelwork, allowing significant cost savings in steel purchases.
As we continue to face economic challenges, collaboration between parties in the supply chain at the early design stage will save thousands of pounds at the contract stage, as we have proved time and time again. The contractor must adapt and liaise with the manufacturer early in the process to take advantage of product and service innovations, and allow them to help reduce project costs at the tender stage. The sector cannot survive on lower prices for long. Now more than ever, we need to embrace the innovation that is out there, designing smarter without increasing business risk. A closer partnership between manufacturers and envelope contractors will provide the win-win situation for a more prosperous year for all.