NSCC state of trade survey reveals specialists’ fears

Just one in ten specialists anticipate an increase in margins in the next quarter, the National Specialist Contractors Council’s (NSCC) state of trade survey shows.

The NSCC warned that while tender prices had improved slightly, sharp rises in materials costs were compressing already wafer thin margins.

Poor payment practices have also worsened, with 83% of respondents having monies withheld against them in retention.

More than one third of all retention monies were overdue for release at an average of over £50,000 per specialist contractor, 17% of which is ultimately written off as bad debt.

Difficulties in converting enquiries into orders means that less than half of specialist contractors are operating at over 75% capacity, down from 62% in the previous quarter, and just one in five are working at 90% capacity or more.

But respondents did say tender prices had improved slightly, with 17% of respondents reporting an increase compared to 13% in the previous quarter.

Suzannah Nichol, NSCC chief executive, said: “The continued rise in supplier prices is putting the squeeze on specialist contractors.

“Whilst more respondents are saying that they expect an increase in workload, this could be due to the desperately low levels of work available at the moment with businesses anticipating that it can only get better.”