The latest FPDC survey indicates that more new orders were received during the second quarter of 2013 (Q2) than at any stage in the previous two years. FPDC members have been reporting that enquiries and new orders were up during Q2 2013 but that margins remain tight and payments continue to cause concern.
FPDC executive director Steve Halcrow said: “More orders and more enquiries is very good news but these have to be treated with caution. Cost pressures with rising material prices and some aggressive contractual activity means many of our members are still under immense pressure.
“We urge our members to consider the implications of any new contract carefully. The industry also needs to encourage the government to maintain pressure on clients to pay promptly and it should take further steps to remove unnecessary bureaucratic costs, which put small businesses at a disadvantage.”
New orders have shown a significant change. During the second quarter of this year, 59% of FPDC members reported new orders were increasing – more than double the increase reported at the same time last year.
Tender enquiries are also on the up, with 50% of FPDC members reporting a rise in enquiries during the second quarter, up from 44% in Q2 2012.
Nearly three quarters of FPDC members were more optimistic about prospects for the future than at the same stage last year, when only one third felt optimistic.
Margins are not moving according to 90% of survey respondents, who said margins were either decreasing or showing no change when compared to the same period in 2012.
Payments continue to be an issue but there are some signs of improvement. During the second quarter, 90% of FPDC member said that on average they were receiving payments in between 30 and 60 days. This is an improvement on the same period last year when the figure was only 72%.
One noticeable move is that more contractors are declining work due to payment terms. Now more than half of FPDC members are declining contracts as a result of poor payment terms.