Paul McFadyen, Chairman of metals4U says: “Metal prices have shot up in recent months, driven largely by the conflict in the Middle East. Disruption to oil and gas supplies have caused energy prices to soar, in turn causing metal production costs to rise, and increasing the overall cost of materials for end users, including tradespeople, construction firms, and manufacturers.

“Other ongoing factors have also been contributing to price increases, such as an ongoing shortage of copper, and restrictions placed on the trade of certain metals in their countries of origin, with China being the most noteworthy example.

“These price increases are bad news for the construction and manufacturing industries, which rely heavily on bulk orders of large quantities of metal. The impact on these sectors will also affect the economy as a whole, with any slowdown in the manufacturing and building sectors being felt on the UK’s GDP.

“For individual tradespeople and small business owners, these costs are especially challenging to deal with. There is often little choice for them but to pass the costs onto consumers, but this has its own problems. Two thirds (66%) of tradespeople say that they have had payments withheld by customers within the last year, with customers most commonly disputing the final cost of the job (35%)1.

“For tradespeople attempting to navigate these cost increases, there are steps to consider:

Diversify materials

“In some cases, the cost of a particular material could be offset by replacing it with an alternative option. For example, high copper prices have been a burden for several years for electricians, but aluminium offers a more cost effective, and more sustainable alternative. Whilst switching to a cheaper material won’t always be possible, it is worth evaluating whether this is an option.”

Evaluate your pricing

“Many tradespeople will evaluate their rates on a regular basis, however, the current crisis offers a good moment to reassess what you charge for your work and services. Evaluate your margins and compare your rates with competing tradespeople in your area. From this, you will be able to adjust your pricing to protect you against rising material costs, without pricing yourself out of local business.”

Be honest with customers

“This is especially important for ongoing jobs, but transparency with pricing is vital to avoid future disputes. Most customers will be aware of the news, but may not understand how this is impacting the cost of materials. Being honest with them about material pricing and how it impacts the cost of their work is an important step for building trust. If you’re in the middle of a job, and the final balance will be impacted by material costs, you should communicate this as soon as possible with the customer to allow them to understand the situation.”

For more information about metals4U, visit: https://www.metals4u.co.uk/