BPF survey of plastic industry signals confidence in post recession recovery, with 73% of respondents forecasting increase in U.K. sales turnover in next 12 months
July 12, 2010
The results of the British Plastics Federation’s (BPF) Business Conditions Survey 2010 have signalled industry confidence in post recession recovery with 73% of all respondents forecasting an increase in UK Sales Turnover in the next twelve months.
Conducted by the BPF annually, the Business Conditions Survey is completed by the BPF’s company members who represent various sectors in the plastic industry and aims to capture key information around industry trends and issues. The survey looks at areas such as turnover, staffing, finance, capital investment and industry regulation issues. The UK plastics industry supplies into all strategic sectors of the economy and is a barometer for the state of industry.
UK Sales Turnover for 2010
This year’s findings have shown a positive outlook for the UK plastics industry with many companies expecting business profits to rise considerably in the next few months. Of the 73% of businesses expecting an increase in UK sales turnover, 24% are expecting a 2-5% increase, 29% a 6-10% increase and 20% an 11% and over.
The move towards workforce expansion is further evidence of recession recovery, with a staggering 46% of companies expecting to increase staff and only 5% stating that they would reduce staff in the next twelve months. This is a substantial change from the Business Conditions Survey June 2009 in which 59% of respondents planned to reduce staff.
Despite the positive outlook for most sectors, the Construction and Building products sector appears to have been badly hit by the effects of the recession with most predicting no increase in UK sales turnover. 5% of respondents cited Raw material price increases as a factor and also public spending cutbacks.
“The survey clearly shows increasing confidence in the plastics industry that a recovery is taking place. But construction products are still rather depressed and there are concerns over raw material price increases and the effect of Government cut backs on private sector customers”, said Peter Davis, Director General of the BPF.
The survey results show a healthy level of planned Capital Investment with 61% of respondents planning Capital Investments over the next twelve months. There is a particularly strong emphasis on this from Moulders, Recyclers, Additives and Masterbatch. While 34% of respondents have stated that an ‘upgrade’ and ‘expansion’ are the reasons for capital investment, 22% of respondents highlighted Energy Efficiency as a key driver.
“It’s particularly encouraging that over 60% of companies are planning Capital Investments over the next twelve months. This is essential to remain competitive and efficient. It’s good to see that many of the investments are to secure greater energy efficiency. This is important in meeting the energy reduction targets in the BPF Climate Change Agreement, “said Davis.
Costly, burdensome and unnecessary Regulation
According to respondents, a growing area of concern is the number of costly, burdensome and unnecessary regulations. At the top of the list 57% of respondents cited Health and Safety regulations as ‘time wasting’ and ‘senseless set of rules and policies’.
“Our companies have listed a litany of time wasting regulations. We shall forward this to the De – Regulation Minister Mark Prisk MP. The new Government is keen to hear suggestions from business on what regulations to dump or simplify,” said Davis.