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Builders merchants feel credit crunch bite

Building material sales through builders merchants are 9.6% lower for the third quarter of 2008 than the same period in 2007.
Figures from the Builders Merchants Federation for July to September show that there is an accelerating slowdown in the building sector. Compared with the preceding quarter sales are down by 3.8%.

Heavyside merchants fared worst with sales down 13.8% on the same period last year, while sales for lightside merchants fell by 7.6% and generalist businesses stocking a mix of heavy and lightside fared little better, falling 5.9%.

The slowdown is affecting nearly all parts of the country, especially the East Midlands (down 15.8%), East Anglia (down 15.1%) and Scotland (down 14.3%). Only the Greater London region showed a slight increase – 1.5%.

Commenting on the figures, Peter Matthews, BMF Secretary, said, “In light of the current economic climate which sees the credit crunch now hitting all parts of the supply chain and with new house building stalled, it unfortunately comes as no surprise to see the trading pattern for merchants depressed throughout the UK. Merchants are seeing sales of materials for repair, maintenance and improvement work continuing, albeit at a declining pace, with tradesmen reporting work up to Christmas 2008. But prospects for the New Year are much more uncertain.”

About Fiona Russell-Horne

Group Managing Editor across the BMJ portfolio.

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