State of the Industry Survey 2017
Download Our 2017 Survey Details At The Foot Of The Page
Survey Reveals True State of the Industry’s Payment Practices
This year we have supported an academic survey that has had a maassive response. It is our fourth national survey and of the 506 respondents 355 were Specialist Contractors representing a broad spectrum of the industry, with 72% being firms with a turnover in excess of £1million and some 37% in the £5million plus bracket..
This year’s survey confirms that there has been no significant improvement in the dire payment situation that the UK construction industry continues to face.
Are the Government / Trade bodies doing enough?
- Only 2.1% of respondents said that the Government was doing enough to resolve payment problems
- 93.23% of respondents said that Trade Associations were NOT doing enough to resolve payment problems.
Government and Trade Bodies claim to be trying to resolve payment problems, but the fact remains that over 93% of respondents think that they aresimply NOT doing enough to solve the problems in the Construction industry.
In open questioning about the payment process respondents suggested;
- the implementation of project bank accounts to ensure a fair, transparent payment process.
- improve current payment legislation
- the government should take a firmer stance on the issue by implementing fair payment KPI’s as qualifying criteria for all public sector projects.
One respondent stated:
“It has to start with the clients and Government insisting that Main Contractors have Fair Payment Charter and respect Sub contractors, it is no good the government saying 30 day payments and employing Main contractors who clearly don’t and will not pay within this period”
Likewise, another respondent said:
“If the Government made payment and treatment of the supply chain as a qualifying criteria for main contractors to quote for Government contracts and then made an example of one or two main contractors with poor records by excluding them from quoting for Government contracts, this would send a message to main contractors that paying their supply chain fairly and on time is essential to enabling them access to high value, secure government contracts.”
A further open question asked if the chief executive of a major main contractor could be asked to change or amend a payment protocol, how and what would you change:
A total of 16 respondents expressed concerns of a “new breed” of commercially aggressive quantity surveyors, who are motivated to “maximise profit” and “seemingly on a bonus to claw back cash.”
Killing Small Businesses
To a small business, payment terms exceeding 30 days can mean the difference between survival and failure, with labour and material costs eating away at their cash-flow while the Contractors hold onto the money they so desperately need. And as a Specialist Contracting business, you know that delaying payment to your labour force or suppliers isn’t an option. The lads walk, and the suppliers put you on stop!
The failure of Specialist contracting businesses does not reflect well on the growth of the economy or the rebuilding of a strong construction industry.
While the Government plug their Small Business initiative, the outlook for small businesses in the UK construction industry is as bleak as ever.
And sadly no surprise that according to the Office of National Statistics’ figures; in the 12 months ending Q3 2013, the highest number of liquidations was in the construction sector at 2,819. A bleak picture which regrettably adds to the 5,000 construction insolvencies between Q3 2010 and Q2 2012 (figures from PwC).
The continued poor payment practices and ruthless unfair treatment of Specialist Contractors identified by our survey has to be stopped for the good of the industry as whole, and to help ensure the UK’s economic recovery.
The Importance To The Economy
The government would have you believe they are investing in infrastructure to boost the industry and the economy, but those taxpayer’s pounds are not flowing down the supply chain. It’s being cut off at source to prop up ailing Contractors who pay for their own incompetence with your money!
The survey also showed that there are similar issues on private sector construction projects, albeit slightly better, with around 11% of Specialist Contractors being paid in 30 days whilst a staggering 23.5% had to endure payments longer than 60 days.
What Can Subcontractors Do?
Here are 3 great ideas;
#1 You can help by downloading the information below and using the #Buildgate hashtag on social media, on your website and on emails. In fact, anywhere where you are in touch with colleagues and like-minded individuals who want to change what is happening to the Construction industry.
Using the #Buildgate hashtag, you can join the fight.
StreetwiseSubbie is the ‘Champion of the Specialist Contractor’. Barry Ashmore and his team have made it their mission to help the Subbies fight back against onerous contracts and poor practices that infest the Construction Industry.
‘Hot air’ from Government and large associations will not change it. We’re all fed up with soundbites. What the industry needs is real change. Action. From the top down!
Help put a stop to poor contractual practices before more Specialist contractors, employees and their families are destroyed in the race for the lowest prices and highest profits.
Please use #Buildgate.
#2 Our exclusively for Specialist Contractors training seminars are taking place in November. Here are the details;
“Introduction To Contractual Awareness and Using JCT Subcontracts”
“Understand Your Contract to Minimise Risk and Maximise Profit”
WHEN/WHERE IS IT? The dates and venues are as follows;
12 July – Birchwood Park and Country Club – Dartford Close to M25 and M20
17 July – Watford SOLD OUT >>> SOLD OUT >>>
18 July – Marriott Hotel – Waltham Abbey Close to M25, M11 and A10
WHAT DOES IT COVER? The course is presented in a straightforward down to earth easy to follow style using real life examples. It is designed to give a detailed grounding in the essential elements of subcontract law and procedures, with emphasis on the JCT subcontracts. The course covers practical aspects of how contracts are formed and how to understand and use the key provisions of the contract.
Full details are available on request, but here are the headlines;
- Session 1 – Contract Formation
- Session 2 – Introduction to JCT Contracts and Construction Act
- Session 3 – Time, Notices and Delay and Disruption
- Session 4 – Instructions, Variations and Maximising Return
- Session 5 – Getting Paid On Time and the Right Amount
- Session 6 – Resolving Conflicts and Disputes
- Session 7 – Putting It All Together
WHO SHOULD ATTEND THE COURSE? The course is exclusively for Specialist Contractors and is designed specifically to provide a broad appeal for Specialist Contractors staff who work with contracts; which includes; Estimators, Contracts Managers; Project Managers; Commercial Managers, Quantity Surveyors, Credit Controllers and Directors.
WHAT WILL WE GET OUT OF IT? Specialist Contractors often end up at the mercy of the Contractor simply because they don’t understand the contract or don’t apply it when they should. This course will enable you to understand the fundamentals of those subcontracts, and give you more confidence when dealing with contractual matters.
WHAT DOES IT COST? As a previous customer you receive preferential discounts and rates – book now to ensure you receive your Early Booking Discount!
Book early and instead of paying £350, you can pay just £315.00 saving you 10% off the standard price.
Book two or more places and you can pay just £280 each saving you 20% off the standard price.
All rates are subject to VAT
To book or for more information please contact us directly on 01773 712116 or mail email@example.com to confirm your places.
Below are just a few examples of the feedback we received from our recent NEC3 Training Seminars.
“Easily digestible information delivered in an interesting and easy to understand format”
“Very detailed and informative”
“Very informative and well delivered”
“the contract was previously some document I would avoid reading, not any longer!”
#3 How Can StreetwiseSubbie Help?
StreetwiseSubbie.com Ltd exists to help all Specialist Contractors regardless of size or specialisation. We are working with a range of organisations and private practices and are developing our nationwide support network.
We are available to work with anyone who shares our passion for the Construction and Engineering Industries and supports the fair treatment of everyone in the supply chain.
We can be contacted as follows;
Call us on: +44 (0)1773 712116 Fax us on: +44 (0)1773 719455
Email us at: firstname.lastname@example.org Web: www.streetwisesubbie.com
Or write to us at:
Streetwisesubbie.com Ltd Shanakiel 17 Ilkeston Road Heanor Derbyshire DE75 7DR
Enter your details below to download “The Betrayal Of The Specialist Contractor” plus all the Surveys of Specialist Contractors, and/or the Press Releases and other documents.