While sales volumes improved for Britain’s builders’ merchants in the fourth quarter of 2024, prices were down by more, which meant that takings were down by 2.2% on a like-for-like basis, compared to 2023.
The latest Builders Merchant Building Index (BMBI) report reveals that, for the year as a whole, takings were 4.1% lower in 2024 than in 2023. With three more trading days in 2024, like-for-like sales revenue was down by 5.2%.
Sales volumes in 2024 were down by 4.3% compared 2023, and prices were largely unchanged, rising just 0.2%.
Product categories that sold more in 2024 include workwear & safetywear (up 10.8%) and tools (up 6.7%). Renewables & water saving products were down by 24.0%, timber & joinery products sold 6.4% less in 2024 and heavy building materials volumes were down 5.5%.
The fourth quarter of the year saw a distinct slowing in traffic through builders’ merchants. Q4 volumes were down 15.6% on Q3 2024 and, despite prices rising by 2.0%, takings were 13.9% lower than the previous three-month period. With four fewer trading days in the most recent period, like-for-like value sales were down by 8.2%.
That said, December takings rebounded slightly, up by 3.0% year-on-year. Volume sales climbed 7.4%, while prices fell by 4.1%. December takings were weak compared to November – down 32.5% – but this is in line with seasonal trends.
Builders Merchant Federation chief executive John Newcomb said: “After two pretty tough years, I remain cautious about overstating prospects for the coming year, but one or two encouraging signs are now emerging in our sales data. With interest rates gradually coming down and consumer confidence improving, we should be preparing for growth in the second half of 2025.”
MRA Research director Mike Rigby, who produces the monthly BMBI report, said: “The latest GB construction data from ONS shows a slight increase (+0.5%) in output in Q4 despite a 0.2% fall in December, and overall a modest 0.4% increase in output for 2024 compared to 2023. While this is the fourth consecutive year of annual growth, it may not feel like it for merchants who were actually down 4.1% on value sales year-on-year.
“Whether things change for the better in 2025 will hinge on a number of factors, including restoring consumer confidence to encourage spending on property and home improvement projects. Inflation may have dropped to 2.5% in December and there was also a cut to interest rates, but prices and outgoings are still considerably higher than they were pre-Ukraine war, putting continued pressure on household budgets.
“The latest Consumer Confidence Index from NIQ GfK shows a drop in all metrics at the turn of the year with the biggest drops being to people’s perception of the general economic situation over the next 12 months (-8). January’s overall index fell five points to -22 – the lowest it has been in over a year.
“Changing hearts and minds about how and where consumers spend their limited disposable income may require a change of tack. A report into what matters to today’s consumers, published by Capgemini Research Institute, showed that the cost-of-living crisis was still driving people to seek out more affordable options and that sustainability was a critical factor in the purchasing decisions for 64% of those surveyed. Social media is an increasingly influential factor, particularly for Gen Z consumers.
“Interestingly, generative AI is now influencing more buying decisions with 58% of people choosing GenAI recommendations over traditional search engines. Demand for quick delivery has also surged.
“If merchants are to earn a bigger slice of the pie, particularly while trading conditions remain tough, they may need to shake up their approach to engage with the way modern consumers – including trades and end users – want to buy.”
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