Supply Shortages & Costs Rise Warning as Threat of No Deal Brexit Looms

UK CONSTRUCTION companies are being advised to liaise with their supply chain much earlier than normal as the end of the transition period for leaving the EU looms.

Construction contractors association, Build UK has estimated that in the case of a no deal Brexit, duty and other costs could increase from two to eight per cent.

Suzannah Nichol

Build UK Chief Executive, Suzannah Nichol, said, “The overriding message from all businesses is the need for much earlier engagement across the whole supply chain, along with enhanced forecasting information to anticipate and manage supply and demand issues.”

No UK Stock

Products imported solely from Europe, such as lifts, facades, cladding and roof tiles are on the ‘watch list’ as they are usually made to order and there is little stock held in the UK.

“Projects requiring these, particularly any which are specialist or bespoke, should be talking to suppliers and manufacturers, placing orders earlier than usual, importing products ahead of time, and storing them in the UK, particularly in the first quarter of 2021 and where they are on the critical path of any programme,” said Suzannah Nichol.

Timber Short Supply

Timber has been in short supply since March 2020 and a range of timber products continue to be on longer lead times. Build UK advises advance ordering and working closely with supply chains for the first two quarters of 2021.

New Supply Tracker

Meanwhile, Build UK and the Chartered Institute of Procurement and Supply have released a Materials Report on the supply of construction products from January 1, 2021, which they plan to update regularly.

The report reveals where goods are manufactured and how they will be affected by changes in regulations, currency fluctuations, transport and import duties.

The availability of supplies will also be influenced by ports used for imports, the length of supply chains, and the raw materials used. The level of risk will increase as the amount of control over an aspect of supply falls, warns Build UK.

Brokers Hank Zarihs Associates said that shortage of supplies was one of the main reasons why projects overran and was a risk, property development lenders were watching closely.

CORRECTION
In an earlier version of this story, Roofing Today erroneously published that 99% of Marley’s raw materials are imported.

The correct situation is that 99% of Marley components are UK sourced and therefore the company expects Brexit to have minimal effect on its business.

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