Business News
Increase in fabricator start-ups predicted
» ANDREW SCOTT , INDUSTRY consultant and CEO of Insight Data , predicts an increase in fabricator start-ups as capacity problems plague existing fabricators . His prediction follows data revealed at the recent Glazing Summit conference , where he highlighted a decline in PVC-U fabricators – from 1,860 manufacturers ten years ago to 1,195 today .
“ In the last few of years , we ’ ve seen the number of PVC-U fabricators dwindle . Some have pulled out of fabrication to focus on installation , others , such as Sash UK and Indigo Products have collapsed .”
While many fabricators have expanded production capacity in recent years the current increase in consumer demand , coupled with supply-chain problems means many installers are struggling to source products , with lead times extending and prices increasing . Some
fabricators have even turned away customers .
Andrew continues ; “ Faced with ever decreasing options , some installers are now seriously considering manufacturing . The main driver appears to be better control over their supply chain . Indeed one systems company reported that only 40 % of new customers this year are swap-overs , 60 % are either companies wishing to fabricate for the first time or are returning to manufacturing after pulling out in the past .
“ Our industry is facing a unique set of circumstances with a reduction in manufacturers and increased consumer demand , as well as the supply-chain issues and rising costs that other sectors are facing . Of course , manufacturing brings its own set of problems and requires specialist skills – as well as availability of machinery , materials and labour . However , it appears to be an increasingly attractive – or necessary – option for some firms .”
Make UK , the body that represents 20,000 British manufacturers , upgraded its forecast in June and expects manufacturing growth to double .
This data is an extract from the full Insight Data Report 2021 , which will be available shortly .
Interested parties can register to receive a copy at www . insightdata . co . uk / reports /
CASHFLOW CRISIS COULD BE LOOMING
» INSIGHT DATA ’ S CEO AND INDUStry consultant , Andrew Scott , warns that the industry could face a cashflow crisis over the next few months .
“ As an industry we ’ ve been focused on managing supply-chain issues and employment headaches caused by the pandemic and Brexit , and managing customer expectations in extremely difficult circumstances .
“ But it may be time to go back to the fundamentals of business and cashflow management as we approach Christmas and New Year .”
Andrew revealed the latest industry facts and figures and results of an installer survey during the recent Glazing Summit Conference .
“ The data shows consolidation with the number of installers and PVC-U fabricators declining . This can be good news , with less competition companies are winning more business but there are some underlying issues that could create some real problems over the next few months .”
Presenting at the Glazing Summit Andrew outlined how installers had large order books and many were fitting jobs now that were sold 4 or 5 months ago ( or longer ).
“ There are two problems here . Firstly , many of the jobs being fitted now or over the next couple of months were sold before suppliers implemented a string of price increases . It means jobs could be fitted at drastically reduced margins or even at a loss in some cases .
“ Secondly , many installers have amassed huge order books where homeowners have paid large deposits months ago , providing a significant and artificial cashflow bonanza which in some cases has been used to prop-up the business , mitigate margin erosion or fund larger stock levels and work-in-progress .
“ The industry has never faced a situation like this , and we all know how quickly cashflow can swing , especially after a few weeks of Christmas / New Year slow-down or bad winter weather . Installers don ’ t have the option of factoring or invoice discounting so planning ahead now could avoid a potential disaster , especially as suppliers are less likely to be flexible .”
This is an extract from the full Insight Data Report 2021 , which will be available shortly .
Interested parties can register to receive a copy at www . insightdata . co . uk / reports /
76 DECEMBER 2021 CLEARVIEW-UK . COM