There can be no doubt that this is a challenging time for many in the construction industry, especially in light of recent events. However, there are enormous opportunities too for companies willing to engage with new trends and stand at the cutting edge of construction (daunting though it may be). But what does that mean for the civils and drainage sector? What are the opportunities in this market?
The big picture is fairly typical of the construction market as a whole, in that the civils and drainage market is down by about 3%, due to projects being put on hold or shelved. Ongoing delays in large infrastructure projects, rising costs, and the growing skills shortage are impacting on the market. Enquiries remain high and many companies are busy with quotes and rebidding, but conversion to sales is not where it should be and new projects are thin on the ground.
There have been huge infrastructure ‘commitments’ from the Government, promising over £500bn in investment over the coming 10 years, including £28bn for London alone and £23bn on the UK’s transport and communication infrastructure. But the most the UK has ever delivered in a single year is £20bn. It would be extremely difficult for UK construction to invest, train and increase capacity for this significant uplift in work without proper planning. It remains to be seen whether the resignation of Lord Adonis from the National Infrastructure Commission will have any effect on this. Will we continue to see big spending announcements without the policy and detailed plans to back them up?
What’s needed is greater engagement with policy makers and stakeholders to outline and then work to realistic delivery targets that reflect economic certainties.
However, addressing these challenges, I see opportunities for civils and drainage in three key areas:
- Developing more of the solution in products to combat the skills shortage
- Effective use of technology to add value with bespoke solutions
- Thinking more aesthetically when developing products. Civils can be sexy! It doesn’t have to be dull and grey. Future projects need to effectively combine practicality and looks.
On the first point in particular, the Federation of Master Builders reported that two thirds of SME construction firms are struggling to hire bricklayers or carpenters. This hits the civils and drainage market because it can have a knock-on effect that delay projects. Plus, many large contractors are simply not investing in skills development, as it is one of the first areas to be cut back in times of economic uncertainty. So suppliers to all areas of construction are increasingly being asked to deliver solutions rather than stand-alone products. In fact, what we all need are solutions to needs or problems, not just products.
Although the skills shortage is worrying, it is also an opportunity for suppliers to add value with solution selling and bespoke products that make it easier, quicker, better and more efficient for contractors to complete their projects on time and to budget.
So while none of us can see what the future holds - and despite the large backlog of infrastructure projects - it’s not all doom and gloom. Manufacturers that invest in innovative products, develop effective solutions and adopt new technologies will overcome some of these challenges. We are certainly seeing this in civils and drainage.
Managing Director & BMBI Expert
Alumasc Water Management Solutions
This is a guest blog from a Member of the CPA. The information and views set out are those of the author and do not necessarily reflect the opinion of the CPA.
By Steve Durdant-Hollamby (Alumasc Water Management Solutions) at 6 Mar 2018, 10:30 AM