As we head towards the end of the year and closer to Brexit day, which is March 29th 2019, as if you needed reminding, I am happy to bring you a fourth exclusive interview as part of my special series: DGB Brexit – The Interviews.
This week I am happy to bring you comment from Deceuninck UK Managing Director Rob McGlennon. Just to clarify, I never ask the interviewee their voting preference. This is revealed to me once I see the answers I am give.
So, the same ten questions as previous guests, ten different answers. Enjoy.
1. How did you vote in the EU Referendum and was the result what you thought it might be?
I voted Leave, so I was obviously pleased! I don’t know whether I expected the Leave vote to win, but in my opinion it’s the best result for the country. I don’t believe Project Europe is working.
2. What are your thoughts on how the negotiations have progressed and do you think a deal will or won’t be done in time?
So far, we’ve seen a well-played game of brinkmanship from both sides. I believe a deal will be done, whether now or in the extended transition period, because it’s in everyone’s interest. The EU is our biggest and closest trade partner, but the EU sells more to the UK then we sell to them. For example, around 1 in 7 cars made in Germany are sold in the UK. According to the EAMA (European Automobile Manufacturers Association), German car exports to the UK in 2017 totalled €22.7 billion.
3. How has the EU referendum vote and its effects impacted on your business?
The weakened pound has compounded the increase in raw material costs. So yes, our costs have gone up, but demand for Deceuninck products has gone up faster.
Cost increases are a fact of life, not only because of exchange rates, and the whole supply chain needs to accept prices will need to go up – for trade, retail and consumers. The solution is to work together, increase the value of what we sell and follow the money.
4. How would you say your business has performed since the time of the vote?
Deceuninck sales have never been better! We were well up in 2017 and colour reached a milestone of 50% of overall sales – now it’s over 55%. This year, in a market that’s 10% down overall, we are up 17% YTD and October 2018 sales are up 45% on October 2017.
Deceuninck’s success comes from giving fabricators the product innovations, service and support (from always-in-stock colour, on-time-in-full deliveries, easy online ordering and strong technical support) to sell in the top end of the residential market – and in the commercial sector, where we are winning projects from aluminium. The premium residential market is expanding, primarily driven by demand from the over-55 homeowners (we call them the ‘Haves’) whose homes have appreciated dramatically over the past 20 years. The Haves want the best performance, design and choice of colours, and they’re prepared to pay more for the right products to enhance their homes.
I don’t think Brexit will spoil the party. The Haves own much of the country’s housing wealth and savings. With rising house prices paying for their purchase, why wouldn’t they invest in colour and beautiful windows to add value to their homes?
5. With Brexit day just a few months away, what plans, if any, have you put in place to ensure a smooth transition on March 29th?
We are working closely with Deceuninck HQ in Belgium to ensure the transition post-Brexit goes as smoothly as possible. We are fully self-sufficient in the UK with extrusion, foiling and warehousing at our Calne site, and we don’t envisage any problems.
Investment is key to our future. We need to continue to give customers the right product mix and service to maintain our strong lead. Early next year we are extending our 26 colourways to 30 to stay well ahead of the competition. That’s always in stock, so fabricators can order colour or white knowing it will be on their next delivery. And installers can sell colour or white, knowing their trade supplier can make their order on time and in full. We call that being #ColourEnabled.
We’re also adding a new product to our Heritage Window Collection!
Sales are soaring, so we will be investing in two new extrusion lines to meet growing demand. We are also planning to extend our vast 140,000 sq. ft warehouse to house our full product line in 30 colourways from stock.
Catch up on the full series:
As we continue our countdown to Brexit day, which is 29th March 2019 just in case you needed reminding, [...]
Following on from the first DGB Brexit: The Interviews piece by Joe Martoccia, I am pleased to say that [...]
DGB Brexit: The Interviews is a special series of written interviews with business leaders across the UK fenestration sector [...]
6. Putting aside your own voting preferences, do you see a path forward where your business and the UK as a whole can still continue to be prosperous?
I’m realistic – there may be a few bumps in the road post-Brexit, but the world will keep on turning and the country won’t grind to a halt. The UK is the 5th largest economy in the world – it continues to defy gloomy forecasts and our construction industry is in good shape. People are still buying houses and developers are pushing ahead with large scale projects. Deceuninck sales are on an upward trend and I’m confident this will continue. We give fabricators the products, tools and service to do well and grow. We have a healthy pipeline of new fabricators joining Deceuninck and I predict we’ll see even more fabricators join us who aren’t getting the right products, reliable service or support from their existing suppliers.
7. Would you like to see a second referendum on the terms of any final deal, inclusive of an option to go back to EU membership?
No. The Government has a mandate for delivering Brexit. Few people, even those who voted Remain, want a second referendum.
8. Should there be another General Election after Brexit day, given the precarious nature of the current Government?
No. Theresa May won a majority, albeit by a small margin, to govern the country for the next five years. Let her get on with the job in hand without any distractions.
9. What do you think the biggest impacts of Brexit are going to be on the UK fenestration industry in the years to come?
If we end up with a hard Irish border it will have an impact on companies trading to and from Ireland. A proportion of our skilled workforce comes from other parts of the EU so any outcome that doesn’t guarantee their rights to stay in the UK would be a problem. But both sides have agreed to protect EU nationals living in the UK before Brexit.
10. Should the UK fenestration sector see this as an opportunity to help grow its own domestic industry i.e. fabrication, training and apprenticeships, exports etc.
Absolutely. Brexit or no Brexit, the industry needs to continue to innovate. The well-reported skills shortage in the construction industry needs addressing. Encouraging young people into the sector through apprenticeships and training will be critical for developing the next generation of leaders. We need them, and we need to tell them that this is a great industry to join!
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