“Orders on the up but margins squeezed”: FIA publishes Market Conditions Review

Wave 4 of the FIA’s must-read Market Conditions Review is now available

Wave 4 of the FIA’s must-read Market Conditions Review is now available

Wave 4 of the Fire Industry Association’s (FIA) must-read Market Conditions Review is now available. The main news is that orders are up although margins are squeezed, and that healthy growth in the sector means there’s now an increased need for more skilled labour and training.

65% of respondents have reported an increase in orders when compared with the preceding six months, with the private sector driving growth. Similarly, the last six months has seen a 73% increase in the number of enquiries received by companies that participated in the Review.

Tender invitations have increased over the last six-month period, with 54% of companies indicating either ‘a lot more’ or ‘slightly more’ invitations. Also, 35% of companies that replied have recruited skilled labour in the last six months whereas only 9% have shed skilled labour.

The need for workforce training continues to increase, with 58% of respondent companies anticipating an increase in training over the next six months.

Suppliers have continued to increase prices with only 5% of respondents reporting a decrease.

87% of companies that contributed to the latest Review reported that they’re receiving payment in 60 days or less.

In the last six months, FIA member companies received 40% more invitations to tender than did non-members.

What the survey respondents think

The survey respondents this time around believe that excessive amounts of fire safety companies within the UK competing for business are hammering already decreasing prices. Increases in material prices are, in turn, increasing supplier cost.

Graham Ellicott: CEO at the FIA

Graham Ellicott: CEO at the FIA

Businesses using fire safety companies for advice are then taking their business to online suppliers to reduce costs. Over the past couple of years, a lot more reverse auctions have been used when tendering for work.

While the number of tenders has increased, so has the number of unaccredited and unregulated contractors tendering for fire-related projects. This has the effect of both pushing down margins and complicating issues with the consultants and end users who don’t see the differences at first hand. On that basis, the belief is that more needs to be done within the industry to reinforce the need for both FIA/BAFE contractors and also for post-installation audit by non-affiliated contractors working without knowledge, accreditation, PI insurance or suitable levels of competence and expertise.

Austerity cuts have seen substantially less activity resulting in less enquiries and sales orders. Respondents believe that the much discussed ‘economic recovery’ has yet to reach the fire sector. Banks are not lending to property developers. “Only larger organisations are benefiting from the coalition Government’s policies.”

*To access a copy of the full report visit the FIA’s website

 

About the Author
Brian Sims BA (Hons) Hon FSyI, Editor, Risk UK (Pro-Activ Publications) Beginning his career in professional journalism at The Builder Group in March 1992, Brian was appointed Editor of Security Management Today in November 2000 having spent eight years in engineering journalism across two titles: Building Services Journal and Light & Lighting. In 2005, Brian received the BSIA Chairman’s Award for Promoting The Security Industry and, a year later, the Skills for Security Special Award for an Outstanding Contribution to the Security Business Sector. In 2008, Brian was The Security Institute’s nomination for the Association of Security Consultants’ highly prestigious Imbert Prize and, in 2013, was a nominated finalist for the Institute's George van Schalkwyk Award. An Honorary Fellow of The Security Institute, Brian serves as a Judge for the BSIA’s Security Personnel of the Year Awards and the Securitas Good Customer Award. Between 2008 and 2014, Brian pioneered the use of digital media across the security sector, including webinars and Audio Shows. Brian’s actively involved in 50-plus security groups on LinkedIn and hosts the popular Risk UK Twitter site. Brian is a frequent speaker on the conference circuit. He has organised and chaired conference programmes for both IFSEC International and ASIS International and has been published in the national media. Brian was appointed Editor of Risk UK at Pro-Activ Publications in July 2014 and as Editor of The Paper (Pro-Activ Publications' dedicated business newspaper for security professionals) in September 2015. Brian was appointed Editor of Risk Xtra at Pro-Activ Publications in May 2018.

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