Q1 2013 Procurement Market Update

Q1 2013 Procurement Market Update

 

Slow Start To The Year?

It has in some ways been a slow start to year in the sense that recruitment processes appear to have slowed in pace in several sectors.  In many cases hiring managers are under such pressure with their day to day work that they find it difficult to make the time to focus on recruitment.  Others are facing delays in having roles signed off or are having to adapt to changing business needs.

That said there have already been a lot of moves in the middle tier of the permanent market (typically £40-£80k in the south east) this year and there is no shortage of demand in the most competitive areas of the market. e.g. indirect spend, see below for more details.

There is also clear evidence that many companies are planning hires for the new financial year and this could spark a flurry of activity in Q2.

 

Indirect Spend

As has been the case since the market began to recover, the competition for best indirect spend expertise remains strong in the corporate world.

Perhaps the best example of this is in Marketing where six blue chip companies within 30 miles of each other were looking for very similar experience at the same time earlier this year.  Some of the roles remain vacant.

The other areas of category expertise in greatest demand at present are:

IT –  Software more so than hardware and to a lesser extent telecoms.

Professional Services – There is still a relatively small pool of potential candidates in this area

HR – There are roles that are recruitment focused along with positions focusing on other areas like mobility, consultancy, compensation & benefits etc.

Travel & Meetings – Very much back on the agenda in the last twelve months with meetings appearing to grow in importance in the current climate. Supply Management recently commented on some research in this area published by the Economist Intelligence Unit and commissioned by American Express

Facilities Management – both soft and hard services.

Given the importance of indirect spend appointments to so many of our clients and the market in general, we have decided to formally measure how demand varies over time in the various indirect spend categories to provide some hard data to support our quarterly commentary.

Starting from January this year we are collating figures from across the private sector covering the number of roles in each of the key indirect spend categories.  We will then track this on a quarterly basis to create The www.edburydaley.com Indirect Spend Recruitment Index.  We will publish our first data in mid April.

 

The Interim Market

Despite the more pragmatic approach to day rates that has existed for at least 12  months now, the interim market remains slow with many quality contractors seeking new assignments.

Again we expect the new financial year to give this market a boost as is often the case with new budgets. This could be particularly marked this year with several consultancies needing interim resource if the projects referred to above are finally approved and experienced consultants are required at particularly short notice.

 

Industry Sectors

We are currently working with clients in FMCG, banking, pharmaceuticals, consultancy, leisure and business services and in each case we are aware of demand for similar skills from our clients competitors. However sector trends remain difficult to define with inconsistencies across each area. A good example is that of the IT Services sector where headcount restrictions exist in a couple of major players whilst some competitors have several open vacancies in procurement,

 

Senior Management

There remains very little movement at the most senior level of the market.  As has been the case for the last two years big moves at CPO level are relatively rare, and leadership roles within smaller functions are still highly sought after by a large pool of highly qualified candidates.

 

Transformation Consultancy & Spend Management Providers

All of our consulting clients are busy with existing projects and bidding for new work, but headcount restrictions are common.  Several of the big multi disciplinary practices and niche procurement specialists have resources stretched to capacity, and with new projects imminent with the start of the new financial year, many are having to plan their recruitment pipelines for the second quarter.

There is growing demand for both senior managers offering business development capability and experienced consultants in specialist Spend Management organisations.  In terms of demand for staff this is demonstrating classic signs of a growing market.

If you wish to discuss any of the points raised in this article please contact Andrew Daley on 0161 300 7978 or via andrew@edburydaley.com

Procurement Talent Profiles Q1 2013

Procurement Talent Profiles Q1 2013

January is of course a classic time for people to think about their plans for the new year and 2013 is no different with many people encouraged by the improving job market and tempted to assess alternatives to their current role.

At Edbury Daley we spend much of our time networking and sourcing new candidates for the range of blue chip clients we work with so we are constantly in contact with some of the best talent in the market. Following the positive response to our September Profiles we have again decided to publish a sample of the type of people we deal with on a regular basis. We have chosen candidates that reflect where our network and recruitment capabilities are at their strongest but it should be stressed our reach is not limited to these areas.

These profiles feature several outstanding professionals who have indicated that they are interested in seeking new career opportunities in 2013.  The experience these people offer is predominantly procurement focused but also includes closely associated areas like spend management where technical capability is also of  value, and a range of consulting talent including business development and programme leadership.

Below are the job titles of the people in question. For reasons of confidentiality we can’t publish full profiles but they are available upon request via info@edburydaley.com

Procurement Consulting & Outsourcing

Director – Leading Procurement Transformation Consultancy

Associate Director – Niche Procurement Consultancy

Managing Consultant – Big 4 focusing on Procurement

Programme Manager – Procurement Outsourcing

Senior Consultant – Indirect Spend

Business Development Manager – Procurement Transformation Consultancy

Consultants seeking roles in industry

Senior Consultant – Big 4, Supply Chain & Procurement

Senior Consultant – Big 4 – Procurement & Technology

Indirect Spend Specialists

European Category Manager – Marketing

Sourcing Manager – Professional Services

Global Category Manager – HR Services

EMEA Category Manager – General Indirect

IT Procurement Manager

Global Category Lead – IT Outsourcing

Category Manager – FM & Corporate services

EMEA Travel Manager

Category Buying Manager – Property and Facilities

FMCG Sector Specialists

European Purchasing Manager – Flexibles

Procurement Manager – Corporate Services

Senior Group Buyer – Packaging

Group Buyer – Ingredients

Travel & Leisure

Procurement Executive – Non Consumables

Buyer – Food and Non Food

Spend Management

Director of Spend Management Solutions Practice

Business Development Manager – Spend Management Solutions

Spend Management Implementation Specialist

Interim Managers

Purchasing Director – FMCG Direct & Indirect

Category Manager – IT, Real Estate & Marketing

Category Manager – FM

Category Manager – IT

Category Manager – FMCG Ingredients & Packaging

If you would like to receive more details of any of the individuals featured here please contact us via info@edburydaley.com or alternatively you can call Andrew Daley (0161 776 4603) or Hannah Jackson (0161 776 4608) for a confidential discussion.

What will the housebuilding market look like in 2 years time?

Predicting the future in any industry is a precarious business, in housebuilding it is almost impossible. The past ten years have seen huge amounts of volatility. Since 2008, anybody involved in housebuilding has been pre-occupied with the credit crunch so it is easy to forget the mergers and acquisitions that preceded. For those who worked for Westbury, Beazer, Wilcon, Alfred McAlpine and many others the pre-recession years were full of job insecurity despite the prevailing market conditions. For those that were on the wrong end of redundancy several times before 2008, the recession was the final straw. Having found gainful employment in other sectors they will never return to housebuilding.

The three and a half years that have defined the recession have, unsurprisingly, put a halt on acquisitions.  Banks have been licking their wounds and repairing their battered balance sheets so loans for acquisition have been hard to come by. For those builders who were highly geared pre recession the last few years have involved constant dialogue with banks to restructure debt, avoid breaching covenants and generally staying solvent. However, as the new homes market shows early signs of stability the odd rumour of who might be buying who is beginning to resurface. Further consolidation of housebuilding companies seems likely as the institutional investors like to see clear market leaders enjoying substantial market share and benefitting from economies of scale.

The mortgage market is showing signs of easing with an increasing number of 95% LTV products becoming available. This should re-open home ownership to the first time buyer which in turn allows increased movement further up the chain and will put an upward pressure on house prices as buyers begin to compete for individual properties. The next two years is likely to see the mortgage market find it’s balance point between managing credit risk and profitability. It is worth bearing in mind that default rates in the UK never grew beyond 1% even at the peak of lending which suggests that there is plenty of head room for high LTV products at sensible rates.

All of the largest UK housebuilders closed offices during the recession, particularly where they had multiple offices in one geographical region. This was all part of the rationalisation of capacity to enable them to make profit at half of the 2007 production volumes. However, if the mortgage market does encourage the first time buyer back to the market housebuilders will have two growth options to fulfill demand. They can either grow organically by opening new offices (or re-open previously closed operations) or go down the acquisition route and purchase an established competitor in the target region. The former method will lead to recruitment of staff and may force the industry to be a little more open minded about where it sources it’s new employees. With fewer competitors to plunder for staff and many of those made redundant now lost to the industry forever, housebuilders will have to look at transferable skills from other sectors and improving their own training and personal development to make the most of these individuals.

Housebuilding market update – Q1 2011

Housebuilding market update – Q1 2011

Everyone involved in the housebuilding industry continues to experience very challenging market conditions for a variety of reasons, primarily the restricted availability of mortgage finance, but there has been some evidence of slight improvements in the past quarter.

Using data from www.careersinhousebuilding.co.uk and http://www.zed-sales.co.uk/ supported by evidence from our extensive network of housebuilding professionals, we have observed the following trends:

The most encouraging trend in the recruitment market is the increase in advertising for site based roles. E.g. Sales, Site Management and to a lesser extent Quantity Surveyors.  There is evidence of this on www.careersinhousebuilding.co.uk

This reflects an increase in the number of new sites and overall production from builders of all sizes.

There is little evidence that builders are moving away from the lean approach to regional and head office staffing which many adopted at the beginning of the recession.

Recruitment at Manager and Director level appears to be mainly replacements rather than an increase in head count.

The strongest area of temporary recruitment in the housebuilding market is for site based sales staff as builders seek to utilize the availability of experienced Sales staff to cover holidays, new sites and increased visitors to site.  There are examples of such jobs here: http://www.zed-sales.co.uk/?cat=7

Most builders appear reluctant to employ head office or non-sales site based staff on an interim or contract basis, preferring to wait until they can justify recruiting a permanent member of staff.  This is in contrast to other industries where the temporary market is busy due to the need for flexible resource in areas like IT, finance, construction and sales.

Suppliers to the housing market (particularly building materials) have increased their advertising in 2011 signalling their optimism that this year will be one of recovery for the industry.

Senior management within the housebuilders have told us that they expect the 2011 market to be relatively flat with no significant improvement before 2012 or in some views 2013.

The restricted availability of mortgage finance remains the major factor in the challenging market conditions.

Budgets remain very tight for most organisations in the sector.  From a recruitment perspective builders remain keen to avoid paying fees if it all possible.  We built our model for www.careersinhousebuilding.co.uk around the need for builders to have a quick, inexpensive online advertising resource solely dedicated to the industry.

Past seasonal trends were bucked in 2010. For example several builders we work with experienced stronger sales in August and December 2010 than the autumn which is usually viewed as a busier period.

Many builders are now actively seeking new sites as their land banks dwindle, but land values are increasingly volatile in an uncertain marketplace.

Whilst some of the larger builders have restructured their debt and are in a much healthier state as a result, there remain some smaller builders that are reliant on the banks view that they are of more value as going concern for their continued existence.

Larger housebuilders have completed significant restructuring to allow them to be profitable operating with much lower production volumes.

What do you think will happen in the industry this year?  Here are some of the discussion points that we are investigating at present:

Would an interest rate rise kick start the market? Historical trends suggest it may do.

Regional variations. Is the South East fairing better? Will there be a ripple effect further north?

The mortgage guarantee schemes recently launched by Barratt and Taylor Wimpey. Could they be the answer to lack of finance to first time buyers?

What do you think of the points raised here?  Are they consistent with your experience?  Why not comment here http://www.edburydaley.com/wp/2011/02/24/housebuilding-market-update-q1-2011/

Procurement Market Update – Q1 2011

Procurement Market Update – Q1 2011

The early signs for this year’s procurement recruitment market are very encouraging as we are currently experiencing our busiest January for several years, with this coming on the back of a very strong Q4 last year.

In fact we were very surprised by the figures announced earlier this week indicating that Q4 saw a 0.5% contraction in the economy.  During this period, the demand for procurement staff was as strong as at any time since mid 2008 levels.

Here’s a summary of our observations on the current market trends:

Recruitment activity for procurement staff across almost all areas of private sector is up significantly on the same period last year, particularly in the Electronics, IT, FMCG, Business services and Consultancy markets.

Using our own data, we have observed the resurgence of the permanent recruitment market with a 127% increase in activity between Q4 2009 and Q4 2010.   This is in part due to an increase in business confidence and less pressure on head count.

Demand for accomplished category specialists in key areas of indirect spend like Marketing, Professional Services, IT, Telco, Facilities and Travel is strong, particularly for those who offer the vital combination of stakeholder engagement and change management expertise.

Many Procurement & Supply Chain Consultancies are actively recruiting into their consulting force.  In recruitment terms this is generally viewed as a good sign of an increase in activity and spending within target client organisations, also stimulating demand for the very best candidates.

Fortunately the market is characterised by a large number of excellent people looking for new roles, particularly those who have stayed in the same role during the recession but are now looking for their next career move.

This is also boosted by the availability of many people in the public sector who are concerned about their futures. However there is very little evidence of private sector companies recruiting public sector Buyers in any significant numbers so far.

After a lengthy period of relative stagnation, moves at the senior end of the market are starting to become more regular now. It will be very interesting to see when the CPO market really takes off but we anticipate it being at some stage later this year.  We’ll keep you updated on this next quarter.

The availability of interim candidates is markedly down since the middle of 2009.   In our opinion that particular niche market has now genuinely recovered, and we have already seen evidence of day rates starting to creep back up this year.

There is a noticeable increase in competition for “up & coming” procurement professionals. Such people are often graduates with 3-6 years professional experience and are perceived as being relatively inexpensive by CPO’s given the range of modern procurement skills they can offer.

At Edbury Daley we are specifically working to identify the best emerging talent in the profession. If you are a looking for that next step in your career please talk to Chris McGowan (chris@edburydaley.com 0161 776 4605) about the roles we are working on at present.

Good news for all involved in the FMCG market, Hannah Jackson will be returning from maternity leave on 1st March. If you are seeking a new role in the sector or need to add new talent to your team, particularly in core categories like Packaging, Ingredients or Raw Materials then you can contact Hannah now via hannah@edburydaley.com

Procurement Systems & Skills Survey – are we in balance? Our latest research topic is still available online.  We’ve already had some very interesting contributions and would really welcome your input before we start our analysis. You contribute to our research here http://www.edburydaley.com/wp/category/surveys/ and also access our research archive which is increasingly popular.

Having difficultly finding the talent you need for your procurement team? Are you facing some of the challenges we have touched on in this market report? If so please call Andrew Daley on 0161 776 4603 to discuss how we can help, or contact him via andrew@edburydaley.com