Summary
• Fencing businesses don’t seem to be suffering a lack of orders.
• The bad summer weather dented sales of garden products.
• The agricultural and rural fencing sector has had a good year.
• The sector needs to resist the urge to undercut prices.

Everyone is talking credit crunch at present and with, at the time of writing, inflation having gone beyond 5% for the first time in well over a decade, there certainly appears to be no hiding place for anyone, no matter what the industry.

But it’s not all bad news and there is just a danger of talking ourselves into an early grave if we’re not careful. Sometimes the reality is not as acute as the media hype – and the smiles that still exist on the faces of most of those involved in the fencing industry belie what is happening on the world stage.

In Fencing News magazine we regularly feature all manner of fencing and landscaping businesses and not one of them has mentioned a lack of orders from either the public or councils – and they include businesses from as far afield as Lincolnshire, County Durham, the Home Counties and West Cumbria.

Equally there has been little or no mention of another hike in prices of timber being on the cards.

However, there is no doubt that there has been some effect and where this appears to have been felt most harshly so far has been in the new buildings sector, both in homes and business property.

Bluntly, if new property is not being built then new fencing is not needed either and this has led to several contractors having to lay off staff as a result of new build contracts either being terminated or postponed.

Home improvements

The positive spin for the residential sector, when recessions occur, is that homeowners tend to put what additional monies they may still have into improving their existing properties rather than moving – and that appears to have been the case in the first half of the year.

Of course this year has also seen something of a double whammy with the dreadful summer having dented sales of gardening equipment and materials, and has also delayed the improvements that people may have wanted to make.

At Fencing News we have seen 2008 as being a particularly buoyant time amongst the security fencing sector, although the roll-out from recent news over council funds having been lost through the Icelandic banking disaster may be a potential problem in the future.

The agricultural and rural sector is another which has had a good year, following on from the better prices which the farming world has experienced in both crops and livestock over the past 18 months.

On the supplies front, the panic buying of timber, caused by the tightening of supplies in 2007, and increased costs that went with it, has stabilised this year.

Cautionary note

But there is just a note of caution that should be thrown into the ring at this time – and it is one that a number of our industry colleagues are concerned about. If the crunch does cause an even greater effect, then it would be all too easy for businesses to start reducing their prices in order to beat the opposition to a sale.

The fear within the industry is that, if this were to happen, it would be the first step on the road to oblivion. A price war is not what is needed right now. Undercutting will not have a beneficial effect on the industry.

It is our opinion that, as much as anyone can, the next 12 months are about riding out whatever storm is on its way, because it doesn’t appear to be consuming us just yet. And who knows – hopefully, the fencing sector won’t see it as much as some other business sectors which are already being affected. Think positive and don’t panic – that’s the Fencing News message.