Inflation Drives Sales Increase Amid Falling Merchant Volumes

TOTAL VALUE sales data from Britain’s Builders’ Merchants (BMBI) shows Q3 2022 recorded +4.3% year-on-year growth. However, price inflation (+14.6%) continues to drive the increase in sales, as volumes fall -9.0%.

The BMBI report shows ten of the 12 categories sold more in Q3 2022 compared to the previous year, with Renewables & Water Saving growing the most (+38.4%). Workwear & Safetywear (+23.6%), Kitchens & Bathrooms (+17.2%), and Plumbing, Heating & Electrical (+14.2%) all grew faster than Merchants overall.

Landscaping (-1.3%) and Timber & Joinery Products (-11.1%) were the only categories to sell less. With one less trading day this year, like-for-life sales were +5.9% up.

Comparing Q3 2022 with Q3 2019 – a more normal pre-COVID trading year – total value sales were up +32.4%. Despite one less trading day in the most recent period, like-for-like sales were +25.3% higher. All categories sold more, including Timber & Joinery Products (+32.3%), Renewables & Water Saving (+30.8%) and Landscaping (+28.6%) which all did better than Total Merchants.

Quarter-on-quarter, sales were down -2.2% in Q3 2022 compared to Q2 2022. Volume sales were down -5.5% and prices were up +3.5%. Despite four additional trading days in Q3, like-for-like sales were -8.3% lower. Renewables & Water Saving (+14.5%) was again the standout category, followed by Workwear & Safetywear (+8.1%) and Kitchens & Bathrooms (+6.2%). Seasonal category Landscaping (-18.3%) was weakest.

September Total Value Sales

Q3 sales weren’t helped by a weak September, which was up just +3.0% year-on-year. Volume sales were down -9.6% and prices were up +13.9%. With trading days taken into account, like-for-like sales were +7.9% higher for September 2022, which benefited from an extra day. Nine of the twelve categories sold more including Renewables & Water Saving (+62.6%) and Workwear & Safetywear (+32.5%).

Total value sales in September 2022 were +28.3% higher than the same month three years ago, with no difference in trading days. Eleven of the twelve categories sold more than September 2019.

Compared to the previous month, September 2022 total merchant sales were marginally down (-0.5%). Volume sales were flat (+0.1%) compared to August, and prices fell -0.6%. Half of the 12 categories sold more, again led by Renewables & Water Saving (+28.2%).

Emile van der Ryst, GfK Senior Client Insight Manager – Trade, said: “This consistent theme of price increases and volume declines mirrors much of what is seen across the UK economy, and like other sectors, there’s probably an expectation that volumes will continue decreasing. The final quarter of the year will be increasingly difficult, as highlighted by the Bank of England expecting a two-year recession.”

Download the BMBI Q3 2022 report here.

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