Construction Sales and Marketing Newsletter

December 2013

Merry Christmas and welcome to this month's edition of the Construction Sales and Marketing Newsletter. There is continuing optimism regarding market activity although caution is still required, as regional variations and skills shortages are hindering a return to growth in some sectors. This is where understanding industry forecasts is of benefit in your planning, my recent interview with Nobel Francis of the CPA provides some advice on this.

Finally congratulations to the winners and high commendations of the Construction Marketing Awards, a reminder that despite economic challenges marketing still plays a vital role in construction.

Construction market activity

The Chancellor presented his Autumn Statement last week with one positive point relevant to construction, that the government would be investing Ł1bn in loans to unblock stalled housing developments in Leeds and Manchester; he commented that "If we want more people to own a home we have to build more homes." It was also announced that Councils would be given the ability to sell their most expensive social housing to help fund more house building.

On the down side, the decision to water down the energy company obligation targets has caused energy companies to call a halt to funding now, even though the consultation is in January with implementation in March. This action is reported to have put a number of social housing projects on hold. This may be slightly countered by promised support measures to the Green Deal to boost demand.

The Nationwide House Price Index has announced an increase of 0.6% in November 2013 which was 6.5% higher than November 2012. The Halifax House Price Index announced an increase of 1.1% in November, making this the tenth successive monthly increase. However the average house price is still 12% below the August 2007 peak.

The latest CBI Industrial Trends Survey shows that UK manufacturing is the strongest it has been in 18 years, pointing towards UK recovery accelerating. The report stated that 36% of manufacturing firms reported total order books above normal in November and 25% saying they were below normal. This gives a balance of 11% which is the highest since March 1995. The report also said that the volume of output in the three months to November rose at its fastest since January 1995.

With all the news of fast growth and strong recovery the UK Construction Purchasing Managers' Index from Markit and CIPS increased to 62.6 in November, up from 59.4 in October. This is the seventh month in a row activity has risen, making it the highest recorded value in 6 years.

However with all this growth happening so quickly it is not all cheer and promise. Jobs website Adzuna has released its UK Jobs Market Report, which shows that the recovery of large construction infrastructure projects is taking place mostly in the south, creating a significant increase in construction jobs in these regions; however increases in jobs in the north is not as positive. A recent survey by CITB has highlighted concerns over skills shortages. The study shows that over two fifths (42%) of construction firms are struggling to recruit workers with the right skills, and nearly one in five (18%) employers said that a skills gap has hampered their growth.

Regulations & initiatives - a quick update

The latest edition of Part L is now available: Conservation of fuel and power (New dwellings) and Conservation of fuel and power (New buildings other than dwellings).

The Government has published its National Infrastructure Plan 2013. The government recognises that meeting the UK's infrastructure ambitions requires a long-term sustainable plan, and recently major industry leaders and government ministers signed a joint initiative to reduce 24 million tonnes of carbon in infrastructure. The initiative, called Infrastructure Carbon Review, looks to save valuable resources by using new technologies, construction techniques and low carbon materials to cut down on emissions.

The Homes and Communities Agency has published figures for housing starts they were responsible for delivering and the DCLG has published figures for the Help to Buy scheme.

In a letter to the Prime Minister, John Sinfield, Managing Director to Knauf Insulation claims the government's levy to help hard working people with energy bills is having a devasting effect on the energy efficiency industry. The government as published its explanation of the changes to ECO and the Green Deal called streamline the Green Deal.

A recent study by the NHBC into Low and zero carbon technologies in new homes reveals that homeowner's don't understand green technologies and presents the need to help house builder's demonstrate the advantages of these green technologies to potential home buyers.

Understanding Forecasts - an interview with Nobel Francis of the CPA

The construction industry has complex interrelationships between buyers and decision makers which are becoming increasingly complicated, with new demands and pressures such as sustainability and the introduction of BIM. With a cautious return to growth it is important to keep informed of changes in the construction market and its sectors. Monitoring changes and understanding industry forecasts can help inform your strategy, ensuring you are well placed to make the most of new opportunities. The Construction Products Association are leading providers of industry forecasts and I asked Nobel Francis, Economics Director, for further information on how they produce this.

Read the full blog article

Product Specification - growing future prospects

At a recent summit Chief Executives of some of our leading construction contractors were asked to comment on prospects for the future. These are some of the phrases they used: Building information modelling, collaborative behaviours, drive around efficiency, working smarter, more for less, cost in use, energy in buildings, more sustainable construction.

Although this was the contractors' view it gives a very good indication of how things will change. With it will change the significance of product specification and the way it is done. Now is the time for businesses to come out of hibernation and start taking action to ensure they reap the benefits from the predicted return to growth.

Read the full blog article

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What's being said - a round-up of useful marketing items

In a recent article for RIBA Insight Ian Exall, Chair of CIMCIG, says "failure to pin down a clear and concise marketing brief is the cause of much waste and inefficiency". You can read his article I need a brief for tips and advice, or indeed visit our blog, how to write a comprehensive market research brief written a little while ago but still relevant. Indeed here is a summary of our most popular blogs from 2013:

As thoughts turn to 2014 here's some Christmas reading to help with your planning:

Finally we would like to congratulate the winners and highly commended from the Construction Marketing Awards. Lafarge Tarmac were the big winners taking home five trophies! Other winners included large companies like Murphy and Jewson as well as smaller ones such as Alive and Safehinge.

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