1: Unfortunately, despite these measures, the financial crisis at the end of 2008 caused a collapse in sales in the construction sector and in 2013 Durafit revenues were further reduced to 1.2 billion of pounds. Although the UK construction market is now recovering, industry sources predict that the trend towards modular construction will continue and that overseas suppliers will continue to dominate the traditional structural components market. As we know, the market for traditional Durafit steel components in the UK was in steady decline prior to the 1990s. New modular construction techniques replaced traditional construction methods, so there was less demand for Durafit products. Furthermore, cheap imports from the Far East meant Durafit and a competitive price, because it is possible to use Durafit elements, which were becoming increasingly difficult to win business in construction projects. As we know, durifit sales shrank from 10% to 1.6% from 1998 to 2008. The company appointed John Austin in 2007 and acted quickly by reducing costs by 50% by closing and reducing the number of employees. In 2008 revenue was £1.6 billion, but when gross margin was 43-44%, by 2013 it had shrunk to £1.2 billion. In year 15 sales fell by £8 billion. In addition to the purchase of Stellex which solidifies our position in the modular construction industry, Waldron also invested in new factory facilities, equipment and accessories during 2013, replacing obsolete factory equipment in the Durafit division and expanding manufacturing facilities and inventory for Elite to cope with the rapid increase in sales and inventory levels needed to deliver on the JIT distributor promise. The Elite division sells a highly technical range of composite polymer and resin products designed for civil engineering specializing in...... middle of paper..... .the winning bid was less than 10% of the difference in price. For each tender, the full production cost plus a profit and contingencies will be determined. Stellex expects that a detailed calculation based on a margin will be determined. Stellex's operational structure has a very high percentage of fixed costs. When calculating the cost of each tender, management therefore provides for high levels of allocation of fixed costs. An example of the cost of tender works is shown overleaf. Stellex's fixed cost structure poses a major threat to achieving its 2014 budget. Because cost and pricing policies lead to a loss of sales, but sales of £2.5 billion, while sales of £2 billion have created a cost structure to support the effects reported in this section must be directly affected PBIT Not only 2014. Fixed cost of Stellex The structure represents a serious threat to the achievement of the budget 2014.