Gavin Slark, CEO of Travis Perkins, the UK’s largest distributor of building materials, has warned that prices for construction supplies are expected to rise due to increasing energy costs.
Slark noted that recent developments related to the conflict in the Middle East have disrupted oil and gas supplies, pushing wholesale energy prices higher. This increase is subsequently driving up fuel and transport costs for the construction sector.
He cautioned that these pressures are likely to raise the cost of building materials, adding to the challenges already faced by builders, contractors, and homeowners.
This warning comes as energy bills continue to surge, leaving businesses across various industries preparing for additional inflationary pressures.
“In the last week or so, we’ve had communications from various manufacturing suppliers of ours saying they’re looking at energy surcharges or they’re looking at price increases to counteract energy rises,” he told the Press Association.
“If you’re very energy intensive then it’s a short-term pricing issue and it happens very quickly in terms of the price hitting your business.
“We’re very alert to it and we’re very aware of what the impact will be.”
He said it is a “balancing act” for the company, and they will pass the price on to the consumer “fairly,” but not to “disadvantage ourselves.”
“I think our customers understand that energy prices are rising significantly, the cost price of the materials will be rising,” he said.
“I think if we can find a resolution to the conflict as quickly as possible, that’s probably the best scenario in terms of managing pricing within our industry.”
The Builders Merchants Federation (BMF) reported a 7.2% decrease in UK building material sales for January compared to the same month last year, before the escalation of the US-Israel war with Iran.
While approximately 75% of building materials are produced domestically, many items—such as steel, oils, resins, and glass—require substantial energy to produce. As a result, rising wholesale energy costs are driving up production prices.
Gavin Slark, CEO of Travis Perkins, pointed out that increasing fuel prices for transportation could have the most immediate effect on operations, as delivering materials to builders across the UK is a significant part of the company’s activities.
Although most of Travis Perkins’ products are sourced within the UK, Slark mentioned that some small items imported from the Far East may also experience price increases due to higher shipping costs, adding further pressure on builders’ expenses.
The combination of rising domestic energy prices, transportation costs, and supply chain challenges suggests that inflation within the construction sector may continue to increase in the coming months.
