BMF assesses Carillion’s impact on materials supply chain

The Builders Merchants Federation (BMF) has undertaken an initial survey of its members following the collapse of Carillion to assess the potential impact of the company’s liquidation further down the building supply chain.

The BMF represents builders, plumbing and timber merchants, as well as companies that manufacture and supply a vast array of building materials. Its members’ combined sales turnover is around £28 billion.

John Newcomb, chief executive of the BMF, said: “From our initial survey of members, it seemed that very few traded with Carillion directly, and it was a very small part of business amongst those who did. However, a number believe they are likely to be indirectly exposed as their customers include Carillion sub-contractors.

“It is well-known that Carillion operated on 120-day payment terms, and most of their sub-contractors are owed money for work carried out prior to the liquidation. At the moment, it seems that most of our merchant members will be covered by credit insurance for any losses, but they would like to hear from customers who may be affected as soon as possible so they can find ways to move forward and support them.

“We would also call on the government to learn lessons from this and take immediate steps to promote and enforce the Construction Supply Chain Payment Charter, which is designed to ensure that payments are made to the supply chain within 30 days.”

The BMF is also highlighting the employment opportunities offered by the building materials industry, and is urging Carillion’s 1,400 apprentices, as well as other staff, to consider entering the sector.

John added: “There are opportunities within our sector in all parts of the country. Through our own Apprenticeships Training Agency and our dedicated recruitment portal, we can offer recruitment options to former Carillion employees who would like to find out more about furthering their career in the materials supply sector.”