Re:Generation Edition 01
Latest Demoiltion Market Forecast predicts long term growth
Margin call
Waste not, want not
During 2022-23, the industry’s average operating margin is forecast to account for 6.1% of revenue, up from 2021-22, but an overall decrease from the 20% or so of 2017-18. Average profit margin is estimated to have fallen to 3.2% in 2020-21 as a result of sector-wide cashflow issues resulting from pandemic-induced operating and supply chain disruption, before recovering slightly during 2021-22, and will likely continue to rise in 2022-23. Nevertheless, an ability to accurately assess the various stages of a contract during the tendering period, including indirect revenue created from salvage and recycling, will continue to be extremely important. These improving margins are likely to result in the number of enterprises rising at a compound average growth rate of 3.2% through 2028, or 6.1% during 2022-2023, with contractors returning to the demolition market as tender opportunities re-emerge. As a result, demand for personnel could rise by 3.4% during those first 12 months, and at a compound average growth rate of 2.2% through 2028, as recruitment efforts are stepped up to support a once-again expanding order book.
This report highlights the growth of several key trends we have already become very familiar with over recent months, including the difficulty in finding skilled workers as a result of the UK’s new immigration policies,”
On the plus side, however, we can also testify to the increased demand for dismantling services to support the increased emphasis on waste reduction” “
General Demolition always aims for 100% recyclability on all of our projects, so hopefully the report’s prediction that this trend will continue will prove to be accurate.
Nevertheless, the report offers our industry some encouraging prospects at what is a difficult time for many.”
6.1% in 2023 Growth rate of
or
3.23% until 2028
+3.4% demand in 2023 for personnel
Peter Flanagan, Project Director, General Demolition.
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www.general-demoliton.co.uk
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