As building materials giant Wolseley sees profits drop 77 per cent after being hit by the US and UK housing slowdown, plumbing entrepreneur Charlie Mullins warns that the industry needs to adapt to weather the economic storm.
“The news about Wolseley is the latest blow for the plumbing industry,” says Mullins, who founded London-based Pimlico Plumbers with his wife Lynda back in 1979 and has grown it into London’s largest independent plumbing firm, with sales of £15m.
“While we’ve been predicting for some time that the current volatile economic climate will have a strong impact, the speed at which these problems have occurred is startling.
“No-one would expect such a big company to be hit so hard but it seems Wolseley has been caught cold and focused on expansion rather than its customers. The companies now struggling are those who are not negotiating as well as others, and those reticent to trim prices."
Mullins says he’s seen the market change “almost overnight” with the majority of work now focused on immediate fixes, maintenance and repair. Small firms – who can adapt quickly – will emerge victorious.
Will the market dip further? “There is no clear end in sight for the current economic fears and it’s likely the market will remain this way for at least the next two years,” he says.
“If Wolseley does go under, then it may have a positive effect on the survival of others in the industry, who may capitalise on the market opening up. The customer may end up being the real winner, as competition for work drives down prices.”
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