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Competition Law: Internet Pricing
Whitehall has incorporated EU competition law into UK legislation that allows for dual pricing of products by suppliers between goods sold online and goods sold in branch. This change came into force on 1 June 2022 and is called the Competition Act 1998 (Vertical Agreements Block Exemption) Order. It allows for a 12-month transition period that ends on 31 May next year. At first glance, it appears to assist bricks-and-mortar retailers who are concerned at bias towards online sellers. But while this move allows manufacturers & suppliers to sell to online retailers at higher prices, they will have to justify their pricing. Distributors and retailers that believe they are at a disadvantage due to pricing set by manufacturers or suppliers can now complain to the Competition & Markets Authority. Careful thinking is necessary by all involved to get this right.
VABEO is part of EU
competition law, and if Britain had not voted for Brexit, it would have applied in this country anyway. Whitehall has helped, whether accidently or deliberately, by incorporating it into UK legislation.
Manufacturers may want to take legal advice just in case. The order itself is here:
https://www.legislation.gov.uk/ uksi/2022/516/contents/made . CMA guidance on VABEO is here:
https://www.gov.uk/government/ publications/vabeo-guidance.
BMF DIARY DATES
Please check the BMF website at
www.bmf.org.uk for all the latest news and events updates in this ever-changing environment.
The Multicultural Apprenticeship Awards 2022 Apprentice Finalists have been released and Keira Lynch, Marketing Apprentice at the BMF, has been shortlisted for the Creative Media & Marketing Apprentice 2022.
The award’s received a record number of nominations, with more than 300 apprentices nominated nationally across a wide range of categories. Keira Lynch, the Marketing Apprentice at the Builders Merchants Federation, has done extremely well to have fought off some very tough competition to become a Finalist. The Multicultural
Apprenticeship Awards in partnership with Pearson showcases the outstanding work and achievement of apprentices from multicultural backgrounds in Britain and inspires other
October 2022
www.buildersmerchantsjournal.net
apprentices to reach their full potential. The awards are organised by Pathway Group, who aim to close the diversity gap in apprenticeships by supporting apprentices and working with employers to make meaningful change. The awards platform has been instrumental in creating future leaders and ambassadors for apprenticeships and has brought to the forefront key issues surrounding the need for more diversity within certain sectors. Winning employers have
showcased their diversity and inclusion strategies and how it’s helped them to shape an inclusive and diverse work environment as best practice examples for other organisations to follow suit.
“We’re here to celebrate apprentices and the people that employ and train them. Best of luck in the process and congratulations to all this year’s finalists!” said Safaraz Ali, CEO of Pathway Group.
Lynch said: “I am honoured to be shortlisted for the Multicultural Apprenticeship Awards 2022. I have put an immense amount of dedication into my apprenticeship and to be recognised by the Multicultural Apprenticeship Awards is truly incredible. I look forward to meeting the other finalists on the 04 November in Birmingham.”
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Price inflation drives Q2 record Merchant Sales
The BMF’s Builder Merchants Building Index (BMBI) latest report on sales of building materials in the UK, once again underscores the impact of price inflation on the sector. Overall sales revenue in Quarter 2 2022 was the highest since the BMBI started in 2015 but, just as in the first quarter of the year, this was largely driven by price inflation rather than volume growth.
Q2 2022 vs Q2 2021 A detailed comparison of Q2 2022 with Q2 2021, shows total builders merchant sales increased by +4.0%, with one less trading day this year. Volume sales were-11.3% lower, while prices increased by +17.3%. In terms of Q2 sales values, Heavy Building Materials – the largest category – recorded a
+9.2% increase in 2022 vs 2021, while both Timber & Joinery (-3.0%) and Landscaping (-6.3%) decreased. Kitchens & Bathrooms was the highest performing category, increasing by +18.5% in value.
Only 3 categories saw volume increases from Q2 2021 to Q2 2022. Services was up by +37.2%, while Renewables & Water Management and Kitchens & Bathrooms were up by +10.6% and +3.3% respectively.
Half year comparisons Looking at the first half of 2022 reveals a similar story, with a value growth figure of +10.1% compared against the same period in 2021.
Drilling down, the market has seen first half price growth of
+16.6%, versus a volume decline of -5.6%.
Behind this, however, is a very telling picture of where the market is heading. Q1 2022 pricing was heavily influenced by a Timber & Joinery year-on-year price increase of +36.9%, which dropped to +30.5% in Q2. Heavy Building Materials is now under pressure, with annual price growth up from +11.8% in Q1 2022, to +18.3% in Q2.
John Newcomb, CEO of the Builders Merchants Federation said: “The negative effect of rampant inflation is starting to show with escalating input costs across fuel, energy, raw materials and wages impacting production costs and adding to existing material supply issues. It is plain to see that the increase in sales values of building materials during the first half of the year has been driven by price inflation rather than volume growth. Regrettably, this pattern seems set to continue into 2023.”
BMF apprentice shortlisted for Multicultural Apprenticeship Awards
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