SEPTEMBER 2019 | 19
News
Installer News is
sponsored by FENSA
PRICE INCREASES ARE UNAVOIDABLE
Adrian Vicker, General Manager at SIEGENIA talks about the
recent price increase the company introduced to its customers,
and the outlook for the hardware sector going forward.
Having delayed for as long as pos-
sible, SIEGENIA took the decision to
introduce a price increase of 2.8% on core
products - with the exception of the sur-
face coating ‘E Look’ which had a further
increase - to its distributor and fabricator
partners in June this year. Like many oth-
ers in our sector, and in the wider industry
we are aware of the sensitivity of increas-
ing prices into what remains a nervous
marketplace, uncertain of how its future
will unfold and where the various custom-
er groups it serves sit right now.
The consumer market remains cautious,
and while the demand in other sectors
such as new house building and the devel-
opment of high-end high-rise apartment
buildings across all our major cities re-
mains strong the impact of price increases
cannot be under-estimated.
We had originally planned to introduce
an increase in January but decided to de-
lay its implementation due to much talked
about ‘other’ factors including potential
tariffs and uncertainty surrounding the
rate of exchange with the EURO linked to
the Brexit process.
We were very determined not to react in
a ‘knee-jerk’ manner to the looming Brexit
deadline and like many others hoped that
‘
we were left with
no choice but to
react to the sliding
value of the EURO
against the pound
’
with a satisfactory resolution to this polit-
ical issue, a price increase would not be
necessary. However, with that not being
forthcoming, and deadlines being missed,
we were left with no choice but to react to
the sliding value of the EURO against the
pound and increases in other areas includ-
ing, material, labour and utilities.
How did we calculate the price increase?
The basis for currency consideration is
that we used an average of the exchange
rate over the previous 12 months and cal-
culated the increase figure based on that
historical information and how we think
it might move over the coming months.
We are not planning any further increases
this year unless there are truly dramatic
currency fluctuations going forward.
Many of our distributor and fabricat-
ing partners have long term commercial
contracts and we fully understanding the
difficulties they face when trying to intro-
duce increases midway through these and
we will continue to work with them to
provide as much stability as we can.
‘NICHE’ BECOMES THE NORM
Over the last five years the timber-
alternative heritage look has captured
the imagination of homeowners, and
Chris Jones of Deceuninck knows why…
It’s been such a hit that
many fabricators and installers
who originally saw flush case-
ments as an attractive and inter-
esting niche product, now see
them becoming the dominant
casement window style over the
next five years, with traditional
storm casements confined to a
fifth or a quarter of their output.
This trend has been reinforced
with the launch of suited heritage
flush doors.
Originally the timber-alternative
flush look was seen as a more
appropriate style for older, period,
heritage properties where modern
storm casements looked out of
place. And they have been accept-
ed as ideal, which is why Dece-
uninck named ours the Heritage
Flush Window. But homeowners,
particularly older homeowners
– the ‘Haves’ – fell for them in a
big way. They love them, and they
love the heritage colours they
come in.
These Haves have low or no
mortgages, and their homes have
been appreciating in value over
the last twenty years as house
prices have risen inexorably. They
may earn less than many younger
homeowners, but their outgoings
are considerably less, so their dis-
posable income is assured. What-
ever they spend on their home
is money well spent, for while
house prices rise, the increase in
value of their property more than
pays for their home improvement.
When they want something, they
get it, and it is the looks, colour,
performance, long life and style
that count, not the price because,
like the famous L’Oréal ad, they’re
worth it.
The Haves have driven the rapid
growth of all the innovative new
products in recent years, and the
astonishingly rapid growth of
colour. We’ve seen an explosion in
sales for on-demand colour. De-
ceuninck’s customers’ sales have
just pipped 60% colour in total,
against an industry average of just
over 25%.
Will Brexit end this strong
growth? As we know from the
polls, a high proportion of older
people voted to leave the UK, but
the threat of an unruly exit and
disruption leaves them untroubled.
Their housing wealth is secure,
and they account for 90% of Brit-
ain’s savings. Many are living off
comfortable pensions or they’re
shortly going to start taking them.
The Haves account for a large part
of the market, and their numbers
are increasing. They have the mon-
ey to invest in beautiful windows
and doors that add even more
value to their homes.
www.deceuninck.com