IS PRICE STILL THE DRIVING FACTOR ON CONSTRUCTION PROJECTS?

Ian Exall, National Sales Manager of Polyfoam XPS gives his view.

Fundamentally, price remains the driving factor on construction projects, but priorities have shifted. The focus is no longer on specifying or purchasing the cheapest products. The priority for most of our customers is value for money. They want affordable products, but which can still perform to high standards and are seeking assurances through third party guarantees and certifications such as BBA before purchasing.

Cost certainty is another key consideration, which is being fuelled by Brexit and fears of the unknown. We are getting lots of requests for long-term pricing for projects, especially for larger schemes which could take two years or more to complete. Many contractors are worried about the risk of product and labour inflation, so want the assurance that prices will remain stable despite potential changes to market and/or economic conditions. Whilst this is understandable, it simply moves the risk along the supply chain where margins may be insufficient to withstand potential inflationary pressures.

At the same time, we have noticed a big crackdown on specification switching and so has our distribution network. This is a trend which follows the recommendations in the Hackitt Review and the push for more competency across the construction industry.

Long-term, this will have a positive impact on our sector as switching specified insulation during construction can lead to inaccurate U-values and potential non-compliance with Building Regulations.

However, following the Grenfell tragedy, minimising risk is another priority for construction professionals and this is affecting all aspects of the industry, including specification. As a result, we are seeing some insulation specifications being held even if there is a better product available both in terms of cost and performance.

This suggests that roofing contractors, main contractors and other specifiers are reluctant to take on the responsibility of any liability that may come with such a change.

Uncertainty won’t go away in 2019 and inevitably, that means our customers will continue to put price in the priority list but it’s no longer just a numbers game. The whole industry is moving towards a more forensic approach that shines the spotlight on quality, performance and risk, and this will continue to affect purchasing decisions.

For manufacturers of construction products, this underlines the ever growing need to provide assurances, advice and support which help contractors and specifiers make more informed decisions.

This commentary appeared in the January 2019 edition of Total Contractor

Please follow and like us: