As the industry got back to work in mid-May, no one knew really knew what was waiting for us. We tried to make predictions. But because no one had really operated like this before we couldn’t be sure what was going to happen.
We know now that demand has been intense since the reopening of our sector, to the point now where it’s perhaps swinging a bit too far now on the pendulum and could do with ratcheting down just a smidge.
Still, we are in early September in a position we could have only dreamed about in March, April and May. As a result, our own family run installations business is already way ahead of where we thought we might have been.
Revised target achieved
As most of us will have done when COVID hit, we revised our targets. I doubt any of those revisions went up. For us, we revised ours down by 35%. Considering that we hadn’t ever worked through a crisis like this we didn’t really know where to set the dial. I looked back at the 2008/9 recession and did some rough numbers based on that. With that revision down, I was still optimistic that we would do better than 2008 and 2009, even though this crisis was worse than the Great Recession.
As we started September, we actually hit our new revised target. That’s almost four months earlier than planned. Thankfully we had no cancelled orders from the pre-crisis installation schedules, which preserved our cashflow for those first weeks we came back installing. This has since been followed up by high demand from homeowners who were unable to carry out their home improvements during lockdown. That pent up demand has come through to us very quickly and in one big wave, which is something many installers will be feeling right now. Add into the mix a number of homeowners spending their holiday refunds and a portion of people who perhaps had not planned to buy new windows and doors this year but have spent most of the year indoors looking at their old ones and now want them replacing.
At the time of writing, we have signed up another week’s worth of work in a single day. We are now explaining to customers who have large projects that it’s now unlikely they will be installed this side of Christmas. Who would have thought we would have been saying that inside early September? The reaction from homeowners has been very understanding so far. Many are getting other bits of work done to their homes and are finding very long lead times from other trades so it does look like expectations are being managed pretty well so far.
The question for us at our place now is whether we will now reach our original target set at the start of the year. My gut feeling is that we might get fairly close to it, but may fall short. If so, it’s still a bonus for the year considering the scale of the crisis that we are all still working through. If we get close to it, or achieve it, its only because of the monumental efforts we’re all putting in right now to try and service as many clients as we can.
I’ll be honest, like many installers, we’re under the cosh. Lead levels remain high and constant. Sales, going through small dips and rises, have remained on the whole steady and the order values have been large. We have sold predominantly full house installations. As a result, our lead time now reaches Christmas and now into 2021. Its has meant a constant stream of late nights and emails at stupid hours in what are sometimes futile attempts to keep on top of the workload. I suspect that a lack of time is resulting in us not winning every order we might, but the situation is what it is right now.
For the past few weeks we have been working to manage the expectations of our clients. Although as I have said most have already been very understanding so far. From the first initial conversations, we are talking about lead times and the fact that at the moment we cannot give them a precise installation date. We have been explaining the pressures on the supply chain and people do get it. Honesty is the best policy right now. The risks in not doing so could result in some very unhappy people when they find out the windows they thought they could get fit in November won’t actually be installed until after Christmas.
Being honest about the situation at the start protects you as an installer from angry phone calls and emails from homeowners.
Many installers, including ourselves, will be looking at whether to bring in more fitters. I think we all accept that at some point this high level will tail off to something more sustainable and less stressful, perhaps near the end of October and early November. That being said, many installers at that point will have order books into February and even March in some cases. How long before an installer needs to bring in more labour to reduce their installation lead times?
Right now I would argue that when lead times from suppliers are going beyond 10-12 weeks and sometimes more in a few cases, trying to reduce fitting lead times may be a fruitless exercise. For example, if you had a lead time of 12 weeks for fitting, but an extra crew could reduce that to 6-8 weeks then on the face of it that would be useful. But, when you factor in that some products could take up to 12 weeks to be delivered, that fitting lead time of 6-8 becomes pointless if what you are selling is taking that long to be delivered.
So whilst more installation crews might solve some problems, when material lead times are going way beyond the norm, it won’t cure every ill. As I mentioned in a post a few days ago, we are simply going to have to accept longer lead times for a while. It won’t last forever, and we will move past this pinch point to something more reasonable. But we are where we are right now and I think if homeowners are prepared to accept longer lead times then we should too.
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