C OMMENT & OPINION


2017 AND BEYOND - THE LOCAL MERCHANT PERSPECTIVE


Neil Lawrence, managing director of Saint-Gobain’s Local Merchant Group, predicts that growth will continue, but the needs of customers are forcing merchants to rethink their models as they look to the future.


2016 has been a momentous year with huge decisions being made in Britain. The impact of many of these decisions we have yet to understand, never mind ex- perience. However, for us it has been business as usual and we are continuing to hit our target of outperforming the market.


We have experienced four consecutive record years  what we expect, we will  is interesting is that the factors which have driven this growth over recent years have all been differ- ent. For example, a large part of 2016’s success has been shaped by increased spending in infrastructure and water projects, as well  autumn/winter, which is always a bonus to the industry.


Our real success though has come from meeting the demands of a changing market place. We have ex- perienced amazing results from providing solution- based offers; adding value to customers by working in conjunction with other areas of our business, such as Greenworks.


“We invested time in creating various initiatives in 2016 to further develop our solution offers. Looking beyond simple areas such as estimating, we have established a whole suite of tools that add value to our customers.


By providing support and recommendations based on building regulations, we can  business. This allows us to extend our usefulness to customers.


BMJ January 2017


“The response, especially from smaller businesses and independent builders, has been extremely posi- tive. This approach is one of the most successful sales initiatives I’ve seen in all my years in the industry.


2017 and beyond Continuing to outperform the market will not be easy  business heads into the new-year.


As in 2016, we will to look to solutions rather than products to drive growth in our existing businesses. In addition, our strategy will continue to utilise branch acquisitions. We are de- lighted that we were able to bring on board Bench- mark Building Supplies, and we will work hard to extend their reach.


Gibbs & Dandy is another area of the business where we will look for growth; either through acquisi-  right strategic locations to complement our existing network.


 Merchants will have to deal with economic pressures in 2017, especially with price increases beginning to hit businesses. “What we are    be passed on.


“As we look to next year our forecasts are predicting low volume growth, while at the same time we will experience (high levels of) genuine price increases that customers will start to feel the impact of at the tills. We have recently seen a number of our competitors


“


Inflationary pressures will continue to


squeeze margins... the impact of this will be merchants competing on service rather than price.”


report a decline in margins, as their supply prices begin - tionary pressures will con- tinue to squeeze margins and we believe the impact of this will be merchants competing on service rather than price in 2017.


 


The June referendum has changed the face of Britain but I believe that the future is there to be shaped not feared.


Our industry is more of-  than by reality, after quite a divisive referendum, we need to just get on with it. ‘With price increases already being experienced across the industry, the im- pact of Brexit on the pound


has exacerbated the situ- ation. In addition, the un- certainty that immigrants face might cause further problems for the industry. We are experiencing very low levels of unemployment  of workers to meet the de- mand from the market. If Brexit leads to a reduc- tion in workforce avail- ability this could cause a real threat to customers in trying to deliver build- ing projects, especially of houses, which the country so desperately needs. Clarity from Government on the process of exiting the European Union is vital  construction sector through this period of change. It is not helping anyone drag- ging on the debate. Next year decisive policy could be even more impor- tant as people in Europe have their say with elec- tions across the continent, including France, Germany and Holland. The only cer- tain thing is: there will be change.


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