The construction industry has been hit with one major problem followed by another over the past few years. The COVID-19 pandemic brought the whole world to a halt, but the construction industry has also been affected by issues such as Brexit, the Russia-Ukraine war and even the blockage at the Suez Canal.
With stock levels changing as much as 5% quarter-on-quarter and spiralling costs for materials, the construction industry is facing challenging times. While larger companies are more able to absorb increasing material and labour costs, small to medium-sized businesses are feeling the full force of supply chain issues and increasing costs.
What are businesses doing to avert the risk?
A recent survey revealed that 85% of UK businesses are intending to switch from the traditionally favoured ‘Just in Time’ supply chain model to the ‘Just in Case’ approach. With supply chain issues expected to last until summer 2023 and perhaps even further beyond this, the ‘Just in Case’ model is regarded as a necessary intervention.
Rather than leveraging the cost savings that are generated from the ‘Just in Time’ approach, the ‘Just in Case’ model prioritises having more stock available, just in case it is needed.
Another way that businesses are looking to overcome existing supply chain issues is to use innovative technologies to help to streamline processes and make planning easier. FixFirm has been exploring new technologies for many years to help our customers to increase productivity and reduce costs and our online procurement tool is an example of the benefits digital solutions can deliver.
Future UK economy downturn
The consumer price index has increased from almost zero during the pandemic to 9.1%, with a forecast of topping 11% by October, when the imminent energy price hikes come into place. Many economists are predicting a UK recession or at least a major downturn by the end of 2022 and a large number of businesses may be forced into announcing job losses to save money.
After initially leading the world in terms of economy growth following the pandemic, the UK now lags way behind most other European countries due to the increased inflation. As a consequence of inflation and lack of wage increases, we are now also seeing workers taking action, with rail union strikes and further plans to strike from other industries.
Businesses will need to be able to adapt to any new challenges that arise, especially given how many surprise disruptions were thrown into the mix over the last few years alone. FixFirm works with businesses to help boost productivity through smarter supply chain processes. With solutions such as our innovative online procurement site and our proactive supply chain partnerships, we are helping our customers to overcome current and future challenges.
FixFirm have invested heavily in increasing our stock holding over the last two years in order to shield our customers from much of these supply chain disruptions. We carry stocks of over 10,000 separate products on our shelves and are consistently running at 99% of these products available at all times from immediate stock!
Contact our team of specialists today to see how we can help you to reduce the impact of supply chain issues and take advantage of our ‘Just in Case’ stock holdings so you don’t have to carry excess stock!
