Installers unfazed by Brexit
The Consumer Protection Association installer barometer has been published and its results provide a detailed insight into the home improvement market. CPA Director Jeremy Brett speaks exclusively to Glass Times magazine about the findings.
Opinions have been divided post-Brexit, with many pointing to difficult times ahead for the UK.
In the construction industry, however, growth has been much better than expected. Resumed projects have seen construction activity reach an eight-month high, although supplier price hikes are squeezing margins.
Earlier this year, we released a pre-EU referendum report. Overall the results were positive but slightly less robust than previous years, showing that optimism is cautious.
Now that a decision has been made we wanted to gauge the reaction of installers and re-visit their expectations for the year ahead to see if the Brexit announcement has changed opinions.
The CPA commissioned Insight Data to carry out the survey, which asked more than 12,000 installers a series of questions on their business performance and expectations for the industry and the UK economy.
Installers were asked how 2016 compared to 2014 in terms of profit margins, the number of leads they received, and the level of retail and commercial work they are undertaking.
34% of installers said profit margins had increased in 2016, compared to 2015, with 55% saying they had stayed the same and 10% saying they had decreased. 28% said lead volumes had increased, 48% said they had stayed the same, and 21% said they had decreased.
When quizzed on their business expectations for 2017, 72% of installers said they expected to see their sales increase, compared to just 3% of installers who expect sales to decrease. Just over half (52%) of installers say they expect profits to increase. 38% expect them to stay the same and 10% say profits will decrease.
It seems Brexit hasn’t dampened spirits, although installers are still cautious when it comes to investing in their business.
Almost a quarter (24%) of installers questioned said they won’t be investing in their business in the new year. Those who say they will are choosing vehicles and logistics (21%), marketing and branding (14%), and training or accreditations (10%) as areas of investment.
Just 10% of installers say they will be investing in new staff next year. It may be that the ongoing skills shortages are making it difficult for businesses to recruit and this is forecast to worsen.
Although there is a positivity among installers for the future of their businesses, expectations for the glass and glazing industry in 2017 are less upbeat: 41% of installers said they expect growth across the industry, 41% say it will stay the same and 14% say it will decrease.
Brexit doesn’t seem to have knocked the confidence of consumers. When asked if they had noticed that Brexit has affected consumer spending 79% of installers said no, compared to 21% who said yes.
But when asked if consumer spending on home improvement will increase in 2017, 34% of installers said yes. 45% said it will remain the same and 17% said consumer spending will decrease, suggesting home improvements are not a priority for consumers now.
Regarding material choices; 66% of installers said they have noticed that aluminium windows and doors have become more popular with consumers in the last 24 months, compared to 34% who said they have become less popular.
Compared to the last report, installer optimism has held steady and CPA members are positive going into 2017; and seemingly unfazed about Brexit.
Although there are still reservations surrounding the state of the industry and the economy, which is holding back investment, we are confident our installers and the industry will hold up.