Bellway asks subcontractors for 5% rate cut

Grant Prior 1 year ago
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Bellway is asking subcontractors to cut their rates by 5% from next month.

The Enquirer has seen letters sent to suppliers outlining the measures which it says “is one of the measures we are looking to implement which will reduce our direct costs and will then give Bellway more opportunity to increase production to the benefit of our contractors.”

One angry supplier said: “I thought house builders were going to support their supply chains rather than cut their rates when we are all struggling.”

Latest results for the year to July 31 2019 show Bellway made a pre-tax profit of £662.6m from a turnover of £3.2bn.

A Bellway spokesman said: “Like all businesses, the impact of Covid-19 has been significant and we are looking at ways of working together with our trusted partners, suppliers and subcontractors to reduce our cost base in order to be able to increase production, which will benefit all parties.

“As you will be aware, although construction sites reopened following lock-down, the new way of safe working means that production is slower than pre-Covid-19 so we are looking at ways we can increase our production without increasing costs.

“At a group-wide level we have started communications with partners about reducing costs in order to help the business respond to the unprecedented impact Covid-19 has had on the sector.

“We value the relationship with our long-term partners so we are looking to work with them in finding ways to reduce costs.”

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