July/ August 2022

Contract Business Talk Pilot Barometer
'THE BOOM IS OVER'
In the latest BP Barometer, Neil Cooper-Smith, Senior Analyst at Business Pilot, explains that
whilst it’s not all doom and gloom out there, the market boom is well and truly over...
We can now say with confidence that the
market cooled significantly in the last
quarter, with sales dropping by around
12% in the three months from April to June.
It follows a small drop in average sales in June on
May, down by 3%. The number of new leads also
fell month-on-month, recording a 6% drop.
Those monthly falls aren’t necessarily anything
to write home about. The three-month trend
is, however, worth noting. The market is down,
inflation has hit, and the boom is over.
Year-on-year, things are stark. Sales are down
June 2022 on June 2021 by 30%. Leads are down
29% over the same period.
As we have stated previously, this doesn’t
indicate that we’re heading for a crash, but the
year-on-year change is nonetheless striking.
Average order values, did, however, continue to
climb, up 1% on May. Year-on-year, June 2022
compared to June 2021, the increase is 43%.
As we highlighted last month, we attribute this to a
shift away from single item and ad hoc aspirational
spend, for example the purchase of bi-folds or a
new front door, to a more comprehensive whole
house approach to home improvements.
This is being driven by inflationary pressures,
which is on the one hand driving an element of
market contraction, but on the other creating new
opportunities, particularly in home energy efficiency.
Although the rate of house price inflation has
slowed, simple pressures of supply and demand
mean that the house prices have held firm. As
long as people have equity in their properties and
confidence in the housing market we can expect
them to continue to want to invest.
The Greener Homes Attitudes Tracker from
Natwest showed last month that the number of
people planning green home improvements rose
from 16% at the end of 2021, to 22% in May
this year. It also suggests that homeowners were
bringing improvements forward in response to
rising energy prices.
This indicates that those with a greater
disposable income are continuing to spend. Those
who are feeling the pinch, aren’t.
While council tax rebates and energy relief
payments from government are welcome, they
provide a short-term solution only.
We would argue against this context and as called
for by the Climate Change Committee at the end
of June, the creation of a programme to support all
homeowners in improving the energy efficiency of
their homes is now pressing from an environmental
but also socio-economic perspective.
We believe that this pattern is going to define the
market going forward this year and into much of 2023.
The Bank of England says it expects inflation to
hit a high of 11% before falling back to around
2% by sometime in 2024.
The market is going to be tougher for the
foreseeable future, so understanding where
your leads are coming from and maximising
conversions is going to be key.
The Business Pilot Barometer offers a monthly analysis of the key trends defining window and door
retail, drawing on real industry data collated by the Business Pilot customer relationship management
system (CRM). Business Pilot uses cloud-based technologies to give installers complete visibility of every
element of their operation from leads and conversions to job scheduling, cost of installation, service
calls, and financial reporting.
www.businesspilot.co.uk www.businesspilot.co.uk/barometer
CONNECTING THE WINDOW, DOOR & ROOF FABRICATION SUPPLY CHAIN
JULY/AUGUST 2022 T F 13