Moves to cut costs gathering pace, say data firms and trade bodies

Subcontractors and architects are feeling the pressure to slash their prices as the financial strain of the covid-19 lockdown mounts.

According to a covid-19 update from Barbour ABI, firms near the top of the supply chain have been putting pressure on those further down to cut their costs.

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Suppliers have said they are feeling the squeeze to cut their prices from those higher up the chain

The update said: 鈥淲e have identified a number of reports of either requested or voluntarily discounting across subcontractors and architects.鈥�

David Frise, chief executive of the 黑洞社区 Engineering Services Association (BESA), said his members were being pressured to cut their numbers.

He said: 鈥淎 recent audience poll of the BESA webinar, 38% said they had been asked to discount their rates or felt obliged to volunteer.

鈥淭his would indicate that there is a growing pressure for sub-contractors to lower prices, which could only encourage a race to the bottom and lead to issues around quality.鈥�

This follows a report from architecture recruitment agency Frame Recruitment that desperate practices were offering 20% discounts to win work.

Managing director Martin Bennell warned there would be pressure on practices to be ultra-competitive as the sector began to recover 鈥� and that it would probably impact on salaries.

鈥淲e鈥檝e heard of people offering 20% discounts to win work,鈥� he added.

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