Page 14 - Fab-Nov-2017
P. 14

A look at the market
CAB CEO, Justin Ratcliffe, looks at the latest CAB State of the Market Survey results for Q3, 2017 and previews the latest in CAB’s series of contractual awareness seminars on design liability including a draw for two complimentary places
The latest Q3, 2017 CAB State of the Market Survey holds up well compared to other economic data released for the same period. Early indications from ONS are that construction output declined 0.7% in Q3 2017, the largest fall since 2012 Q3, while the CBI is indicating manufacturers investment decisions for the year ahead deteriorated, particularly for buildings. However, construction product sales continued to increase in Q3, the 18th consecutive quarter of growth since 2013 Q2. CAB’s quarterly survey showed 31% of member firms net balance increased sales in Q3. Looking ahead,
Capital investment
expectations for growth amongst CAB members were 44% net balance for the next quarter and 56% net balance for the year ahead. Once again, these figures compare favourably against the overall construction sector (-21% and 28% respectively).The key driver of cost inflation in Q3 was raw materials (100% net balance), owing to the weak sterling exchange rates and rising global commodity prices. In addition, 73% net balance reported rising wages
Expected sales volumes:
This highlights expectations of CAB members compared to those across the wider construction sector within the Construction Products Association (CPA)
Justin Ratcliffe
and salaries. Demand was reported as the key constraint on sales growth over the next 12 months, 63% net balance (40% net balance in Q2), with raw materials prices 13%. No constraint on activity was reported by 13% of members. In Q3, expected capacity utilisation remained low. Only 20% of members reported that they expected to
Cost factors
operate at between 90% and full capacity over the next quarter (20% for the year ahead).Capital investment again remained one of the key priorities with the focus over the year ahead being product improvement (81%) followed by plant and equipment (63%) and R&D (56%). Encouragingly, across all the capital investment there was a view that investment would increase year-on-year in product improvement, R&D and e-business while property remained the same. The only noticeable fall was customer research (38% net balance for the year ahead against 50% for the past year). ❐
The Fabricator 2017
For further information about CAB, its activities and how to join, please email or contact the CAB office on 01453 828851
Justin Ratcliffe

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