Figures for the final quarter of 2021 published in the BMF’s Builders Merchants Building Index (BMBI) found sales through UK builders’ merchants slowing slightly after two record quarters.
There is normally a seasonal sales decline in the fourth quarter of the year and 2021 was no exception. Total sales values in Q4 2021 were -12.7% lower than in Q3 2021, not helped by four less trading days in Q4. Like-for-like sales, adjusted for the difference in trading days, were down by -6.9%.
Q4 2021 was still the BMBI’s the third best quarter on record, with sales values increasing by +14.7% against the same period in 2020, and also +21.0% higher than Q4 2019, pre-Covid.
All categories sold more in Q4 2021 in comparison to Q4 2020 with Timber & Joinery Products (+28.2%) leading the way, followed by Landscaping (+14.4%), which recorded its highest quarterly sales of 2021. Heavy Building Materials (+11.1%), Kitchens & Bathrooms (+10.0%) and Plumbing Heating & Electrical (+9.6) were among categories growing more slowly.
However, after a year characterised by supply shortages and ending with soaring energy costs, resulting in substantial price increases, growth is largely driven by pricing rather than volume.
Bricks, Blocks, Insulation, Lintels, Plasterboard, Sheet Materials and Roofing Products saw their highest average price during Q4 2021, highlighting the cost pressures currently affecting the market.
Year on Year performance: 2021 vs 2020 and 2019
Reviewing the year as a whole saw a sales value increase of +30.5% against 2020 and +16.4% against 2019, with Heavyside driving activity.
Against 2020 Heavy Building Materials, the largest category, increased by +24%, with Timber & Joinery increasing by +52.1% and Landscaping by 31.3%.
Comparing 2021 with 2019 has provided a more accurate barometer for many merchants this year. Once again, the same three categories led the way with Heavy Building materials up by +9.7%, Timber & Joinery by +37.7% and Landscaping 38.4%.
Comparing 2021 with 2020 in the Lightside categories, Tools (+26.6%) led the way followed by Kitchens & Bathrooms (+24.0%) and Plumbing, Heating & Electrical (+23.5%). Decorating (+17.8%) was one of three categories that improved by less than 20%.
A different picture emerges against 2019, where Ironmongery (+2.3%) was the strongest lightside performer, with Kitchens & Bathrooms (+1.6%), Plumbing Heating & Electrical (-0.1%) and Decorating (-1.6%).
A closer look at regional activity confirms that all regions sold significantly more in 2021 vs 2020, which is not surprising given the Covid disruption in Spring 2020. The strongest growth was seen in Scotland (+39.8%), followed by South East excl. London (+35.4%) and East Midlands (+31.6%).
CEO of the Builders Merchants Federation, John Newcomb, said: “This is a year that merchants can look back at with pride. They have shown remarkable adaptability and resilience to overcome testing conditions arising from the Covid crisis that has now affected operations for almost two years. While sales remained strong in 2021, merchants are now facing continuing supply challenges coupled with a 30 year high in the cost of living which will inevitably impact consumer confidence.”
Emile van der Ryst, Senior Client Insight Manager – Trade at GfK, added: “The coming months bring a dark cloud of even more price increases, further economic difficulties for consumers and potential geopolitical issues further afield. It won’t be an easy year, which makes predictions even more difficult, but there’s an expectation that the market will remain relatively flat. Only time will tell, but right now signs point towards a bumpy year.”