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Plumbing and heating firms have seen some of the highest levels of growth among the trades in the bounce-back from Covid, according to a new report from Big Change.
The field service management software provider interviewed more than 500 trade companies including plumbers, electricians, building maintenance firms and other trades. It found that demand for their services soared by 70% post-lockdown and turnovers were up 79%. However, Covid, compliance issues, and rising costs mean just half of firms are currently profitable, and one in eight fear failure within a year.
Plumbing and heating firms are faring better than most, says the report, with these businesses having seen some of the fastest increases in demand.
As an example, Edinburgh-based Celsius Plumbing and Heating says that although the company took a hit when forced to focus on essential work only during the first 2020 lockdown, its fortunes have bounced back strongly since then.
Celsius delivered a 36% turnover increase as demand rebounded and expanded its team from 12 to 18 people in the year to August 2021. It targets similar growth this year and aims to break the £1 million turnover barrier for the first time.
Michael Cairns, company director at Celsius Plumbing & Heating, comments: “Demand for our services went crazy when the first lockdown lifted. People were desperate to get work done, and we had a backlog of almost 500 jobs to get through.”
However, most businesses surveyed (81%) said that the pandemic had continued to impact their finances negatively in the last 12 months. 67% said their margins had been squeezed by the cost of complying with new regulations, and rising prices for materials, fuel and labour are cited as ongoing problems by more than 70% of respondents.
Commenting on the ‘State of the Field Sector Report’, Big Change CEO Richard Warley, says: “While demand for the trades has boomed since the first lockdown, this backbone of the economy is not as strong as it might look. Only half of firms are profiting from this extra work. There’s a big difference between growing and growing stronger.”
“Many trades businesses have seen profit margins hit by a perfect storm of Covid, compliance and rising costs. One in eight fear they won’t last another year, partly because they’ve taken on more debt and racked up colossal overtime bills meeting customer demand.
“The strong, profitable businesses are succeeding by working smarter to stay in control of their operations, keeping a lid on costs, and making their teams more productive. They are using technology to improve management oversight, plan better and automate processes, and improving communication and response times as part of efforts to make the customer experience their new source of competitive advantage.”
Read Big Changes report: State of the Field Service Sector