As the industry’s relentless pattern of acquisitions and mergers powers on, the industry’s groups continue to get bigger and bigger. And as each one continues to grow and become ever larger, the groups slowly get closer to one another. If you ask me, there’s a battle coming.
More super-groups
As we know, DW3 Products Group is the latest super-group to take shape. With investment of many, many millions of pounds, the group now has Solidor, Eclectic Systems, Nice Door Panels and Window Widgets. They have also acquired some of the best people in the industry too. And it’s not over yet. DW3 have promised more company takeovers and more star names. It’s a bold statement and a clear challenge to the other large groups that operate in our industry.
I also believe that the recent purchase of Eclectic Systems by DW3 was at least part of the reason why Masco has recently agreed to acquire Evolution, another timber alternative company. A super-group the size of Masco may see this new group as a possible threat to their part of the market, so moved to solidify their position by taking over a company of high calibre. For me, it does set the two groups on a bit of a collision course in the timber alternative market. And it should make for great watching from the side lines!
When you look at the structure of the industry, there are quite a number of large groups. There is the Epwin/Latium mega-group after their merger in 2012, systems companies like Synseal and VEKA have a number of companies under each of their own umbrellas, the Masco UK Window Group have half a dozen companies and are themselves part of a much larger international group.
Race to the top
As I have written before, the industry is currently in a phase of consolidation. The biggest and wealthiest groups are now flexing their financial muscles and snapping up the most attractive propositions. And that is going to create a race to the top within the group of super-groups.
With another super-group forming very quickly in front of us, this will spark a race to acquire the very best companies and personell to help each super-group get one up on the rest. It might aggressive at times. We might hear one or two unpleasant things. And one thing is for sure, not one of these groups will admit it’s in competition with the others. But they are.
Benefits for the industry
So whilst the titans are battling it out at the top, there is going to be a very significant trickle down benefit for the rest of the industry in the form of new products and services.
As the groups allow the money to flow into their new acquisitions, we should find that the research and development departments from these companies start to pump ever more advanced and innovative new products for us to sell to the general public. There will be a natural race for companies to keep bringing out the very best products in order to get one step ahead of the rest. Good news for us installers, stressful times ahead for those in charge of dreaming up these new products!
I do believe that we’re only in the middle of what is going to become and exciting and fluctuating period in our industry. Exciting times ahead.
Let’s hope they fancy snapping up a big roof fabricator!!