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Following the post-Covid boom in demand for home improvements, installers are now facing the ‘triple whammy’ of material cost inflation, surging fuel prices and dwindling order books, according to new data from Eureka! Research.
The ‘Uncertain Futures’ report sheds light on how tradespeople are struggling with these inflationary pressures and their confidence in the future of the market.
Analysis showed that the pent-up consumer demand that boomed in 2021 has come to an end and now order books are starting to dwindle. Over three in four tradespeople said they are concerned about the general cost-of-living crisis on consumer spending in relation to demand for building work, new bathrooms, boilers, and kitchens.
Installers told Eureka! that their order books had shrunk, with the average dropping to 2.8 months out. Around a third said they have no worked booked beyond the next month.
Material costs are also negatively impacting the trades, with three in four saying that rising prices are hurting their business. Installers said boilers and radiators reflected their biggest material cost increases.
Soaring fuel prices are also having a significant impact on tradespeople, with the cost of filling up a Transit van breaking the £150 mark.
Over eight in 10 installers said they are concerned about rising fuel prices – and four in 10 say they are “extremely” concerned about the impact on their business. 70% say they intend to pass on rising fuel costs directly to homeowners rather than absorb them.
These factors are all resulting in a working environment where trades are feeling less confident about the future. While 46% of installers were feeling confident during the pandemic (2020), now only 39% feel confident.
Consequentially, nervousness has increased from 26% to 37%.
Dave Ruston, director at Eureka! Research, comments: “How sustainable is this triple whammy? We recommend that the broader sector urgently considers what pressure it can collectively put on policy makers to minimise the impact of the spiraling operating costs on small businesses and sole traders.”
More information about Eureka’s work in this sector can be viewed here.