Despite the pressure of reduced margins, late payment and an increase in the amount of material imported from abroad, the UK’s natural stone industry remains confident of its ability to survive the recession.
This is the conclusion of a survey of members carried out by Stone Federation Great Britain, the body that represents companies working within the industry.
The Federation asked members a series of questions designed to assess their view of the current situation and prospects for the future.
Respondents made it clear that they currently see no evidence of a real recovery from recession. One of the biggest problems facing the industry is the downward pressure on tender prices, with bottom-line cost becoming more important in some cases than the quality of materials and workmanship.
Although turnover remains steady, this pressure to drive costs down has led to reduced margins. Price is becoming more important than ever and is one reason for a notable increase in the use of imported stone at the expense of indigenous UK material.
Financial pressures on companies were increased by a worsening in payment terms with the majority of members who replied to the questionnaire saying the situation is continuing to deteriorate
As a result more and more time is being spent on chasing late payments at the expense of other productive work.
Most companies have spare capacity, though, and say they will probably have to make more reduendencies. Those that are recruiting have little difficulty in finding experienced and qualified people, usually by word of mouth.
Despite this, companies are not satisfied that their new employees have adequate skills in place. There is a need for additional training, not just for industry craftsmen but also among office and administration staff.
There is also a view that the Government could help by making employee legislation less restrictive and reducing employers’ National Insurance rates.
Two of the biggest difficulties facing the industry are the 'passing off' of concrete materials as stone and the mistaken perception that stone has a higher carbon footprint and lower sustainability than other materials.
The Federation’s Chief Executive, Jane Buxey, said: “It's an industry priority to tackle the problem of material being described as stone when it is often man-made with a high carbon footprint because of the production process. That’s before you take account of the footprint created by bringing stone from overseas and the very real problem of ethical sourcing.
“When it comes to sustainability you only have to look at St Paul’s Cathedral to realise that the whole-life cost of a natural stone building compares very favourably with other material.
“Even in this tough economic climate our members remain resilient, believe in the product and in the future success of the natural stone industry.”
This thought was echoed by one respondent to the questionnaire who said: “Competition is fierce, margins are lower, financial credit and exposure is higher, but through hard work we will have another successful and profitable year.”