The global demand for construction materials is very erratic showing different levels of demand. From extremely high demand to stagnant demand, the global construction materials industry has witnessed it all in the recent years. This demand relates to the state of the international economy. A strong and robust economy would imply an increasing demand for the construction materials. The construction materials industry faces a host of challenges. Rising environmental concerns, stricter regulations are some of them. Customers also require improved quality in the construction materials which poses a hindrance to the growth of this industry. In order to tackle the rising costs, companies are trying to take the advantage of economies of scale by producing huge amounts of construction materials and dumping the same into the market.
The recent trend has been to produce materials that not only provide efficiency but also result in subsequent cost reduction in terms of energy consumption. Unlike the traditional principle of business where they focus on ensuring repeat sales, the companies in this industry focus on producing top quality goods having the capability to last at least a decade. According to the study, ‘Construction Materials Global Industry Guide 2013-2022’, the global construction market is segmented into cements, aggregates and bricks. The aggregates include sand, gravel, rocks and other materials used for construction purposes. The brick segment includes all the materials that are developed with the use of fire clay and traditionally include bricks and pipes whereas cement includes hydraulic cements for instance – Portland cement. Some major companies that operate in the construction material manufacturing are Saint Gobain, Cement Roadstone Holding, Daikin Industries, LafargeHolcim and Heidelberg Cement AG. The region wise analysis and studies have revealed that Asia-Pacific region has driven the construction market to new heights due to presence of fast growing economies present in the region which are also characterized by increasing foreign investments.
Over the coming years, technology shall be widely integrated in this field. The important field being integrated here is the Internet of things which is set to make building information modeling (BIM) into a reality. BIM is a representation of the physical characteristics of a building according to which the decisions relating to construction can be easily made without having to make expensive models. The introduction of technology (drones) could possible reduce the time involved in transporting the materials from the manufacturers to the end users. With the introduction of virtual reality, purchasing decisions can be made at an earlier stage and not involve even slightest amount of cost. For instance – construction projects are usually abandoned if they are not as per the requirements of the under. Companies would be able to sell their products via online mode without maintaining huge stock of goods.
The growth in this industry shall be considerably high because of overall projections of global GDP to show an upward trend in the coming years alongside an increase in the disposable income especially in the developing countries. The global competition in this industry is intense with only big enterprises succeeding in gaining more market share.
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Ankur Gupta, Head Marketing & Communications