The BMF has published its latest Builders Merchants Industry Forecast Report, highlighting the impact of a no deal Brexit on merchant sales within the industry.
This comes in the week that the Prime Minister heads to Brussels in a final bid to agree a trade deal with the European Union.
The BMF report analyses the key factors affecting builders’ merchants’ activity to project future sales from October 2020 to the end of 2021. The difficulties posed by both the Covid-19 pandemic and Brexit have made the final quarter of this year and the coming year difficult to predict.
With Government restrictions still in place, this has resulted in the forecast for an 11.1% decline in average year on year growth for 2020.
In addition, the outcome of the Brexit trade talks dominates the forecast for 2021, with the Report analysing two scenarios, the first based on Brexit with a deal, the second on Brexit without a deal.
Under the first scenario, Quarter 1 2021 performance shows strong growth (+8%) if a trade deal is agreed, alongside the implementation of the Covid vaccination programme helping to boost confidence. However, Q1 2021 growth is limited to +3.3% under the no deal scenario.
The forecast shows the outcome of the trade deal affecting sales during the whole of 2021. Furthermore, the forecast with a trade deal shows encouraging growth of 16.8%, but a more pessimistic increase of 12.5% if no deal can be concluded.
Are you in the fastener, tool, fixing or related industries? You can subscribe to Torque Magazine or sign up to our weekly newsletter.
