After an unprecedented year that saw the Covid-19 pandemic sweep the country and Brexit finally take place, the construction industry is starting to feel the side effects in the form of material shortages and price increases. Adrian Buttress, managing director at PermaGroup, discusses his approach to the ongoing crisis and how it’s brought the importance of customer loyalty to the fore like never before.

2020 was truly a year like no other, during which time Permagroup was proud to celebrate both its twentieth anniversary and also a record year for sales as a company – despite the challenges presented by the Covid-19 pandemic. Towards the end of last year, I predicted that 2021 would be a turbulent one but that, as a sector and a business, we would all be better prepared and in a stronger position. 

We got off to an incredibly strong start, with four consecutive record-breaking months – a first in PermaGroup’s trading history. However, as the year progresses and construction activity continues to gain momentum, there is no escaping the material shortages and price increases that are affecting the sector. As such, the time has now come for us to be proactive and ensure minimum disruption for our customers. 

Reward loyalty

Every business has its regular customers, and it is in scenarios like this that the value of loyalty really comes into its own and offers its rewards. For example, we have started allocating stock to our ‘regulars’ to ensure we can keep supplying them as best we can. We are doing all we can to preserve future stock for them and, crucially, are holding off on price increases for as long as possible. 

Although this can mean some difficult decisions when it comes to other customers, for example those who we haven’t dealt with in a few years, I firmly believe it will pay dividends down the line to have held valuable customers close and cared for them during this crisis.

Thinking ahead

While there was no way anyone could have planned and prepared for the Covid-19 pandemic, there has been plenty of time to plan for Brexit and the potential impact we thought it was likely to have on our industry. 

From purchasing bulk amounts of stock to secure old rates and delaying the inevitable increase in prices, through to maintaining a detailed stock plan and KPIs, this can make all the difference when it comes to identifying early warnings signs with regards to stock levels and how much will be needed – based on information from manufacturers. 

Maintain relationships 

A good trading relationship with key suppliers has never been more important. We work closely with our suppliers to forecast likely stock requirements. By combining this with our capacity to house higher than usual stock levels, we are in the fortunate position of being able to continue trading almost uninterrupted so far, despite the challenges facing the industry. 

Looking forwards 

The construction industry is one of the largest in the UK economy, employing around 3.1 million people across the country and making up for around 9% of its workforce, meaning the impact of these shortages and increases is being felt by many. However, it is a resilient sector that has already navigated tricky waters and will continue to do so when it is required. 

There is no doubt that it is going to be a tough few months and I estimate that we will be into the final quarter of the year before things start to improve. We are already learning that a number of projects are being delayed until 2022 meaning that, while 2021 might be a challenge, we already have a healthy start to look forward to in the new year.