Real estate
14:32 5 June 2023
Post by: WBJ

Construction industry faces fierce price competition for contracts

Construction industry faces fierce price competition for contracts
Source: Pixabay

The Polish construction industry, particularly in the SME sector, is facing a challenging situation. Declining revenues are being experienced due to a downturn in the market and a lack of new contracts. The ongoing dispute between the Polish government and EU institutions regarding funds has further worsened the situation. This has led to intense price competition among companies, with many offering unprofitably low prices to secure contracts. Wage indexation mechanisms in the public sector partially compensate for rising costs, but limits on indexation in road, rail, energy, local government, and military projects have proven ineffective, resulting in significant losses for firms.

Companies are now attempting to negotiate higher compensation with both private and public investors. Material prices have stabilized, except for cement and concrete, which have seen noticeable increases.

Source: PAP Business

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