What your supply chain is thinking, and what it means for your next procurement decision.

The contractors, manufacturers, and merchants who deliver work for public sector organisations don’t operate in a vacuum. Their confidence, their capacity, their cost base, and their expectations about where the market is heading all shape what you pay, how quickly work gets done, and whether the supply chain you’re relying on today will still have capacity for you next quarter.

Inprova’s Q1 2024 Supply Chain Sentiment Report captures this picture directly. Every quarter, we speak to manufacturers, merchants, and contractors across the categories that matter most to public sector estates and procurement teams: building works, compliance, heating, construction, and materials. We ask them about pricing, demand, capacity, skills, and the external pressures affecting how they operate. The result is market intelligence drawn from the people who actually deliver the work, not from economic models or industry forecasts that don’t reflect the realities of your procurement categories.

This report matters whether you’re managing an NHS trust’s estates maintenance budget, planning a capital works programme across a multi-academy trust’s school buildings, procuring responsive repairs for a council’s mixed estate, or commissioning compliance services for a blue light portfolio. The supply chain pressures are the same. Understanding them gives you a stronger position when you negotiate contracts, plan procurement timelines, and make the case to your board for how budgets should be allocated.

What’s in the report

• Economic outlook for 2024: analysis from Inprova’s CFO covering GDP, inflation trends, interest rate stabilisation, and what the short technical recession means for public sector procurement budgets and construction output.
• Supplier pricing forecasts: 63% of suppliers are still predicting price increases, down from 79% last quarter. But there’s a stark split between manufacturers (87.5% expecting static prices), merchants (80% expecting rises), and contractors (82% expecting rises). Understanding who’s driving cost pressure and why helps you plan your procurement timing.
• Demand and capacity: 80% of suppliers are forecasting rising demand over the next six months, up 9% from last quarter. Nearly 30% of contractors expect demand to exceed their capacity within six months, up from just 13% last quarter. If your programmes depend on contractor availability, these numbers should inform your procurement planning.
• Labour costs and the skills squeeze: 88.2% of contractors are seeing cost increases for labour. Construction vacancies are starting to pick up after a long decline. Average weekly earnings in construction grew 4.9% in 2023 despite static output. What happens to labour costs when demand returns in earnest is a critical question for every organisation planning major works.
• Red Sea and supply chain resilience: suppliers scored the Middle East disruption risk at 5.5 out of 10. Container costs are rising and lead times are extending. The report includes direct supplier commentary on how they’re managing the disruption and what the tipping point would look like.
• Materials price outlook: the Construction Materials Price Index has been drifting down slowly, but the picture depends heavily on geopolitical stability. 17% of suppliers are now anticipating supply shortages, up from zero last quarter, with contractors the most concerned.
• Strategic recommendations: practical actions for procurement and estates teams including why lifecycle costing matters more than line-level pricing, how to prepare for the shift from MEAT to MAT under the Procurement Act 2023, and why managing board expectations on procurement strategy is critical in a changing market.

Download the full report and use it to inform your next procurement conversation, whether that’s with your supply chain, your board, or your finance director. If you want to discuss how these findings apply to your organisation’s specific procurement challenges, our team is here to talk it through.