materials shortage

Construction materials shortage hitting SME’s hardest

Stan Dulley, Head of Operations at DCP Limited, discusses how the circular economy initiative MATexch can help the construction industry work collaboratively to communicate construction materials surplus stock on site, at a time when it has never been so important.

A rapid economic recovery is underway in the UK, life has returned to almost pre-lockdown conditions and the Government is pushing its ‘Build, Build, Build’ strategy, which has seen a surge in house building, infrastructure and commercial projects underway. As a result, the construction industry is booming but so is the demand for materials. Manufacturing delays caused by the pandemic, as well as shipping backlogs have compounded a materials shortage issue, so just when the industry is ready to kick start its recovery, there is an ‘unprecedented’ situation of demand outstripping supply.

The UK Government is the biggest spender in the construction industry, with some of the largest projects being awarded to main contractors. If these projects are unable to source the required materials needed and prices continue to rise, project gets delayed, and main contractors look to their supply chain for answers and solutions.

We are currently experiencing price increase on our main products, with plasterboard up by 11%, and metal products by 22%. Our area of a project is drylining and fit-out, with 40% of any projects value being the materials, and plasterboard and metal are the two most used products. On a single project with an estimated £400K worth of materials, these increases could mean as much as a £40k price increase to us as an SME. The main contractors are continuing to work on tight margins and won’t want these costs passed on to them.

Every week we hear about main contractors going into administration with outstanding commitments on local council and government projects being put on hold because the money has gone. The knock-on effect is the sub-contractors down tools and leave site as they’ve not been paid.

All this is exacerbated by material allocation issues, a labour shortage due to workers having to isolate and post-Brexit changes to certification rules.

“We needed to do something to help ourselves but also other SME’s in a similar situation up and down the country. Little did we know that things were going to get much, much worse.”

We formed a partnership with Encore Environment, a leading waste management and environmental consultancy to develop an app-based solution for UK construction companies to purchase and sell surplus or unwanted clean building materials. We both recognised that there would be excess plasterboard on sites around the UK – that could be used by others – however, there was no way of easily communicating about it. This is why MATexch, an abbreviation of ‘materials exchange’ was developed. Encore’s knowledge and experience from developing ProjectDIVERT, a platform that facilitates the diversion of reusable construction waste away from landfill to organisations in need, has been essential in converting a great idea into a reality.

Matexch logo

It has been designed to provide construction site managers with quick access to an online marketplace dedicated to the trade of new and surplus clean building products. It has been initially set up for product listings from three of the most used types of building materials – plasterboard, drylining and ceiling materials, with more products planned. Each can be filtered further depending on the description to classify specification, fireproofing and size.

From an environmental perspective, plasterboard can contaminate other waste in a skip or bin which could end up in a materials recycling facility or landfill, so this is not a sustainable option, and a huge waste especially when there are product shortages.

The objective is to provide an easy, transparent way for sites to talk to each other to trade surplus items. What makes MATexch stand out from other online trading platforms is that it has been developed in conjunction with environmental experts therefore, it is BREEAM compliant and follows the waste hierarchy methodology for managing reusable waste based on the best environmental outcome across the lifecycle of the material. Construction companies must demonstrate they are making improvements to become more sustainable and this will give them the data needed in terms of waste cost savings and carbon saved to support internal environmental policies and net carbon targets. Businesses must show they are being more sustainable so are eager to adopt this type of innovation.

“While we hope that it will help with the material shortages we are facing now, a bigger conversation between main contractors, SME’s and government bodies needs to take place to tackle the above issues.”

Unfortunately, poor behaviours within the industry coupled with the “well that’s how we’ve always done it” attitude is distracting us from the real issue within construction of sustainability, social values and the environment. Large construction companies are readily declaring their zero carbon targets, however in reality it’s the procurement process racing to the bottom of a price point that is the driving force for awarding new business. This isn’t going to tackle or solve the problems outlined above, and it’s the SME’s that are at crisis point trying to keep their head above water when issues with stock, prices and labour arise.

With MATexch, we hope to help companies source the materials they need to finish a job on time so there is less chance of them being hit with the financial burden of it over running due to delays, and also in the long term provide a sustainable solution for any surplus materials that may traditionally have been put in a skip and headed to landfill. The app can also support companies that are looking to make carbon savings by keeping items in the circular economy rather than having to manufacture new.

Encore Environment is currently supporting the trial roll out via its clients, so it can be used on site by selected large and medium size contractors. Depending on the outcomes, we are hoping to launch it in the new year.


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