Seventy-one percent of roofing and cladding contractors feel that the survival of their business is being threatened by price inflation and soaring costs.
The latest State of Roofing Industry survey from the NFRC indicated that contractors are raising the price of their work, with 81% putting their prices up since the same time last year. This follows reports from firms that they can only offer fixed prices to clients for a short period of time, as if they wait too long to get started, the roofer’s costs will already have risen significantly.
Materials
Furthermore, the Department of Business, Energy and Industrial Strategy has reported that construction product prices in May 2022 were on average 27.2% higher than in May 2021. A range of factors have contributed such as
raw material costs rising and the energy manufacturers use to make their products being much more expensive.
Labour shortages
HGV driver shortages and an increase in the cost of international shipping have added to the cost of getting materials delivered.
Regarding the cost of labour, more than 68% of firms said they were spending more on their workforce than a year ago.
Fuel costs
The trade body is urging the government to offer support to businesses on energy costs after respondents to the survey noted rising fuel prices as a common cause for concern. Soaring fuel prices have increased expense at every stage of the supply chain—from manufacturing goods, to transportation, to the power needed for installation on site. In the end, this means the client pays more or the contractor loses money on their hard work.
NFRC advice and government request
Many firms can no longer absorb these costs and contractors risk making a loss if they don’t put prices up – 69% had raised the price of their work just in the last quarter. The NFRC is advising clients and businesses alike to have an open conversation about prices and these challenges.
Reducing VAT on roof work would also make things cheaper for homeowners and reduce what roofers need to charge. This has already been introduced on solar panels and insulation, but not to larger renovation projects.
James Talman, CEO of NFRC, said: “Whilst workloads grew in Q2, we may see this begin to level out in the second half of 2022, as client purse strings tighten. Businesses are facing inflationary pressures that force them to raise costs, and roofing and cladding firms are dealing with rising material prices, skills shortages and expensive fuel, in an industry where cashflow is already a notorious problem for many businesses.
“All this comes before the impact of the major uplift of gas prices in the autumn. The construction industry showed real collaboration during the pandemic—the industry needs to continue to display that in overcoming this challenge, especially for those who can least afford it.”
>>Read more from the NFRC here.
