MERCHANTS IN Dundee that supply building materials to the construction industry are beginning to feel the impact of the house building crisis, it was claimed last night.

A spokesman for Rembrand Builders Merchants at Longtown Street said there was an “air of doom and gloom” about the industry and everyone was feeling the pinch.

Over the past couple of weeks The Courier has been highlighting problems in the housing market caused by the credit crunch.

Housebuilding firm the Stewart Milne Group this week revealed that it was about to reduce its UK workforce by 20% because of the ongoing challenges facing the sector.

“It’s been well publicised and you just have to pick up a newspaper and look at the jobs situation to see that companies are paying off workers in the construction industry,” a spokesman for Rembrand Builders Merchants said.

“It’s a difficult one but I would say that everybody’s feeling the pinch just now.

“People in the DIY market are not spending money as well.

“There’s an air of doom and gloom just now but we’re dealing with market forces outwith our control.”

The Dundee office of business rescue specialists Begbies Traynor predicts that larger construction companies will be imposing extended periods for settling outstanding accounts, from 60 days to 90 days.

This will impact severely on suppliers who have not only bought the goods, but will have to wait a further three months for payment.

Ken Pattullo, of Begbies Traynor, warned suppliers to exercise adequate debt control for cash payments by not extending credit unnecessarily.

“There is a real danger that a domino effect caused by the falling housing market and its impact on the construction industry could cause a recession if allowed to go on un-checked,” he added.

The latest research from Begbies Traynor’s Red Flag Statistics shows the construction sector is one of the worst hit by the tightening financial climate.

Mr Pattullo added, “Our advice to any suppliers hit by the current construction fall out, is to firstly maintain up-to-date financial information and regularly review key indicators such as actual performance against forecasts and overheads.

“Secondly, utilise assets properly. Finally, it is important to check stocks of supplies and products.”

THE CREDIT CRUNCH has hit industry and commerce as well as the UK housing market. Has your company been affected by the economic downturn? Has trading decreased putting your business in jeopardy? Do you feel your job is under threat?

Have you had trouble selling your home? Have you encountered problems due to the knock-on effects of the difficulties in the mortgage industry?

If so, Email The Courier newsdesk—courier@dcthomson.co.uk or call 01382 575290. You can also contact us if you have any story to tell.