CPA reports continuing heavy side / light side split in fortunes

The latest CPA State of Trade Survey - 2023 Q2 showed heavy side manufacturers’ sales decreased for a fourth consecutive quarter whereas sales from light side producers registered another quarterly increase, adding to a run of growth that began in 2020 Q3. 

Looking to the next 12 months, 14% of heavy side manufacturers anticipate a fall in sales, while 46% of light side manufacturers anticipated an increase. 

Encouragingly, the Q2 survey highlighted that cost inflation now appears to be abating, with both the heavy side and light side recording the lowest net balances in three years. There was a notable easing in energy costs, whilst fuel costs were reported to have fallen for heavy side producers that tend to be more energy-intensive.

“The mixed fortunes for heavy side and light side sales growth perfectly illustrates the areas of strength and weakness that are appearing in construction right now,” said Rebecca Larkin, CPA head of construction research.

“Heavy side sales have no doubt been hindered by the sharp slowdown in new house building and hold-ups in starting large new build commercial and factories projects. “Conversely, interior refurbishments of offices and retail, as well as public sector energy efficiency retrofit, are in full swing and are driving demand for light side products.”

Around two-thirds of producers – both heavy side and light side – cited demand as the biggest potential constraint on activity this year, highlighting that economic uncertainty remains a dark cloud on the horizon.