Common sense can help alleviate removal pressures
Now is the time that those stakeholders involved in the home buying and selling process are all pulling together to ensure that the English and Welsh property markets continue to function, like a well-oiled machine.
Removal companies have been under huge pressure and demand, as home buyers vied for their services prior to the 31st March – the original stamp duty land tax holiday (SDLT) deadline. Some clients were frustrated due to not being able to book removal companies, but why was this? Was the removals industry struggling with capacity? Was there enough notice given?
I recently had the opportunity to speak to Ian Studd, Director General of the British Association of Removers (BAR), and Adeel Ahmed, Removals Manager for reallymoving who have shared their insights with me on how a worldwide pandemic impacted the removals industry.
For any industry, the last 12 months has certainly thrown up challenges. Ian revealed that in the early days there were “genuine concerns” amongst removal businesses that they wouldn’t survive the pandemic, as they’re not typically “cash rich”. However, government interventions which include the furlough scheme, provided removal firms with the lifeline they so desperately needed to “ride out the storm in those early days of the pandemic.”
When the market re-opened in May, there was seemingly light at the end of the tunnel. Ian explained:
“Pent up demand, coupled with the aspirations of consumers who had gotten used to the new world of working from home, meant that order books across the sector and throughout the UK very quickly started to fill.
“The SDLT holiday, meant that demand continued to challenge the supply chain, especially as most movers have been operating at between 80% and 85% capacity to cater for the inevitable cases of staff needing to isolate. Where those instances have occurred, well over 95% of them have arisen because of social contact outside of work and not through work.
“This is in no small part due to the implementation of safe working under Covid conditions protocols that the BAR agreed with the other professional organisations and associations across the UK’s property market, together with the respective devolved Governments. The net result is that the UK’s B2C moving industry has generally fared very well over the course of the last year and certainly far better than we feared might be the case back in March 2020 with overall levels of activity across the domestic moving market comparing very favourably with previous years.”
Insights from reallymoving revealed that registrations for their removal services in August 2020 didn’t hit the same peaks as they had done in 2019. However, their data showing the first couple of months of 2021 have shown that demand for the services is indeed still at an all-time high.
“There is no question that movers are under enormous pressure at the moment to cater for the volume of demand that we are experiencing. That said, if all parties in the move chain – conveyancers, solicitors, consumers etc – apply a degree of common sense to the process, that that demand can and will be fulfilled.
“The key issue here is to apply reasonable time parameters to exchange and completion of contract which should then allow sufficient advanced notification of confirmed move dates, which, in turn, allows the mover the opportunity to schedule workloads more efficiently. It is also worth mentioning that moves do not always have to take place on a Friday, the burden could definitely be eased considerably by scheduling completions to take place on any one of the other days in the week.”
Adeel echoed Ian’s sentiments on this, saying:
“During the latter half of 2020, we found that removal firms were operating at peak capacity. This was, however, hindered by many firms having staff off ill or self-isolating, therefore reducing the companies’ flexibility to take on extra workloads. We [reallymoving] are hearing that removal firms are busy but able to deal with capacity unless it is a short notice move. Looking ahead, we believe the extreme peaks and troughs will be a thing of the past.”
There is a degree of optimism in the removals industry, however the longer-term effects of the pandemic still need to be taken into consideration. Ian reveals:
“There are still many concerns about what the mid to longer term future might hold. Clearly there is still the potential of a ‘cliff edge’ fall once the SDLT relief does end, although it is to be hoped that we might have returned to the more usual seasonal patterns of activity by then. Another concern is that the removals market is still awash with unregulated, cash in hand operators who exist entirely in the black-market economy and who cause massive disruption in the marketplace. Clearly, they can have a significant effect on setting consumer expectation on price, with that expectation being entirely unrealistic for the properly qualified and regulated, professional mover. The industry needs Government to recognise Moving as a professional trade and to apply greater control or sanction on those who choose to operate outside of the system.”
Finally, I asked what obstacles the removals industry would face in the coming months.
Pricing was an issue, with Ian commenting:
“I guess the biggest challenge will be that the industry will absolutely need to defend itself against downward pressure on price as/when the demand reduces. To operate a professional removals business involves a significant investment in people and rolling stock and it is imperative (like any business in any sector), that margins earned are at a level that allows continuous re-investment, engaging with a professional removals service provider should always be viewed as a value proposition and not as a commodity purchase.”
Adeel believes that the removals business will run a little smoother, and not see the extremes it saw in 2020, commenting:
“Now that the Stamp Duty extension has been confirmed with a tapering in September, we believe 2021 is going to be a much smoother year for removals with a good supply of clients.”