Average profit margins in the fixings and fasteners market are at 6% and just under 10% of companies (84) have recorded a loss for the second consecutive year in the industry, according to a new report.
The research – carried out by market analysts Plimsoll Publishing – analysed 859 companies and included these key findings:
- 195 firms recorded a loss
- 84 companies have made loss for the second consecutive year
- 49 of the businesses that made a loss increased sales
- 98 companies have been rated as danger
David Pattison, senior analyst on the project, said: “Profitability is key to a company’s success. The difficulty for any business working in a very competitive market is to make a good profit.
“It would appear the pressure in the market is having an impact on the ability of some companies to make a profit. It is of course down to the individual company as to how much profit can be realistically made, but the consequences of not delivering a profit at first glance would seem apparent: 98 are firms are now rated as now being at high financial risk.
“For the companies that are falling behind, they need to re-evaluate their strategy and retain profit in order to improve their financial strength. Further to that, however, it appears there is some cause for optimism as the report showcases 511 firms as “exceptional” performers. These firms, despite the pressure in the market, have recorded record profits and sales increases. The report uses these as example companies of the success that can be achieved even in a saturated market place.”