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Testing times call for inventive working methods

In the current climate, being a house builder brings little joy, says Chris Gilmour

The reality of the situation, coupled with widespread media coverage of continuing downturns and losses, must make them feel akin to Andy Murray when Rafael Nadal trounced him at this year’s Wimbledon quarter finals. Queasy.

And naturally, it’s not just house builders who are affected. Suppliers, consultants and other associated businesses are also feeling the heat. So what impact should major contractors be ready for?

At present the collapsing market is having little or no effect. Most of the big construction firms have secure orders for the next few years at least. Mostly this work is not in housing.

The plump order books exist thanks to the large volume of public sector contracts and particularly to the health and education projects that continue to provide the bulk of the work.

The private sector is another story. The downturn caused by the credit crunch is already resulting in schemes being pulled or indefinitely postponed.

Thus, for the next three or four years, major contractors are relying on work from local, health and education authorities.

How far will this reliance will take us?

Public sector borrowing is higher than it’s been for the past 10 years. At the end of May 2008, net debt stood at 37.2 per cent of GDP and the budget forecast for the end of March 2009 is 38.5 per cent.

But can this really be sustained or will the Government find ways to turn down the tap on public expenditure? The thought is almost enough to give us that queasy feeling.

It’s not so long since the last housing market collapse. An economic recession combined with housing activity completely drying up is not pretty.

The wounds may have healed but the memories are still there. The reality is that the market probably won’t learn from the past. We can’t influence it: it is what it is.

However, there are measures major contractors can take to meet our customers’ needs while sustaining ourselves.

We must continue to develop different ways of working. We must become more proactive, more competitive, more ready to rise to every challenge. And have the Alka Seltzer on standby.

Chris Gilmour is marketing director of HBG UK