Sales of building materials to grow to RM30 billion this year

PETALING JAYA: The local building materials industry is expected to record higher sales worth RM30 billion this year in tandem with the vibrant construction sector, said Credit Bureau Malaysia (CBM) Chief Operating Officer Eric Chin.

"Based on statistics, the construction industry is projected to grow at about 12% to 13% this year, against 18.5% in 2012, driven by the entry point projects (EPP) and Economic Transformation Programme (ETP), and that's looking at about RM110 billion in terms of the overall construction industry," he said.

Chin was speaking to the media after the signing of a collaboration agreement between CBM and Building Materials Distributors Association of Malaysia (BMDAM). The aim of the collaboration is to facilitate the BMDAM members' access to CBM's credit information and rating services in a bid to strengthen the credit risk management in the building materials trade industry.

CBM, which was established in 2008, is the provider of comprehensive and credible credit information and ratings on small and medium enterprises (SMEs) in Malaysia.

Chin said amid the vibrant construction industry this year, there is a huge need for the building material's distributors to have access to the credit information and rating services to improve their creditworthiness while effectively monitoring their own credit records for accuracy and prevent identity theft or fraudulent activities.

"The BMDAM members will also be able to enhance their business operation by strengthening their credit risk management processes when dealing with their customers and other business partners," he added.

Meanwhile, BMDAM President New Ching Liong said the association consists of both big players and SMEs, and the collaboration would enable them to have in-depth insights of their customers' profile and creditworthiness, thus improving their credit evaluation efficiency, lower cost of operations and strengthen the quality of debtors. Among the 'big boys' are Ipmuda Bhd, Hap Seng Trading (BM) Sdn Bhd and Hong Leong Marketing Co Bhd.

New added that SMEs involved in the building materials business can also have a bigger credit as long as their payability is good.

"If they are established and good paymasters, we can extend their credit based on the size they need.

"But if they cannot pay after one deal, we will have to terminate them," he added. - Bernama