Friday’s big industry news was the buyout of major industry fabricators Polyframe by their senior management team. It had been a little while since the last industry buyout, and by all accounts there are a few irons in fires elsewhere in the industry that seem close to being finished.
But I think the big takeaway from Friday is that despite the Brexit vote and the rocky road that has put our economy and industry on in the short term, there is room for opportunity and optimism if these chances are handled properly.
A careful Brexit tightrope
A deal like this takes many months. There needs a whole infrastructure built to facilitate such a purchase. This will have started many months before the Brexit vote, and with the pattern of opinion polls all showing a strong Remain vote at that time, I suspect that those involved weren’t even considering the UK leaving the EU.
As the news broke on the morning of Friday 24th June, I am sure that all those involved in the Polyframe deal were suddenly trying to analyze every possible permutation of the result and how it could possibly effect them. You can probably expect that some details had to be changed. Brexit is something that will effect almost everything. Buyouts of a major fabricator are certainly included in that.
Still, despite the political turmoil and the volatile nature of the stock exchange and sterling, the deal was completed and Polyframe now faces an exciting future ahead in an economy that poses both challenges and opportunities.
And it is the latter that perhaps we all need to focus on.
New opportunities will arise
The fact that the Polyframe deal was done is a positive thing. We have heard via the media and anecdotally that projects across the construction sector are now under scrutiny, with some being shelved altogether. Prematurely in my opinion. This one though continued through to completion, and that says to me that there are still opportunities to be had in our industry.
As I write this, there are whispers of another industry deal being done with a big industry name involved. If this turns out to be true, this would point to an inherent strength financially in our sector.
I still think that despite some softening in consumer confidence and banking liquidity concerns that in fact stem from Italian banks rather than Brexit, the UK window and door sector is in a fairly strong position after a few years of strong recovery since the 2008-2009 recession. The economic conditions are nothing close to what they were back then, and if we can survive that, we can most certainly survive this.
The key will be discovering the new opportunities for business as they present themselves. When an economy changes, often old business methods fade away and new ones arise. This will be no different for our own industry.
Where the chances will come from
There are a number of factors that will contribute to creating new opportunities during our negotiations to leave, and once we have left the EU.
I believe there will be a strong sense to buy British. Although looking inwards is not a good long term strategy in a global economy, a strong domestic economy is one built on homegrown, successful businesses. There are already a number of window and door manufacturers and fabricators jumping on this sentiment and advertising strongly how their products are designed and produced here in the UK. This will rise in the coming months as home owners may start to buy into the “buy British” attitude.
But looking further afield, I believe that our industry could do well when it comes to exports. It’s worth remembering that we have not left the EU yet. We’re looking at a 2-3 year timescale for that to happen. We will still be exporting goods to the EU now, during the negotiations and after. That we know.
However we have already started trade deal negotiations with the US, Canada, New Zealand, Mexico, Australia, and there are talks about restarting an old trade route between the UK and Scandinavian countries. These could present opportunities for the right fenestration sector companies to lend their skills and indeed their products to these new markets where perhaps these opportunities weren’t present before.
Of course the lay of land is still to be known. But as the old adage goes, as one door closes, another one opens.
To get weekly updates from DGB sent to your inbox, enter your email address in the space below to subscribe: