Deliveries delayed? Missing items? It’s probably because of glass. There is an acute glass shortage right now, and it’s really beginning to bite. It’s not as if this is a surprise, it has been forecast by pretty much anyone in glass for months. But that doesn’t make it less disruptive.
So the question is, when will the glass shortage end?
Glass shortage could last months
The supply of glass was getting tight earlier on in the year. It certainly wasn’t as bad as it is right now. Then two float lines were shut down for routine maintenance at perhaps the worst possible moment. Then it got worse.
At the moment, there is a severely limited supply of glass made in the UK. European imports are being hit with transport issues that are making that worse, and importing from further afield isn’t really a viable option. The result is that the glass shortage is likely to cause major problems to the end of the year.
There is a silver lining. The new furnace being built in Eggborough by Saint-Gobain is at the halfway mark. It does mean though that it won’t be until September at the earliest before that is up and running. I am not aware of the progress of the maintenance being done at the Guardian facility, although I believe they are behind the progress of Saint-Gobain.
It is hoped that by the end of the year all three major producers are back up and running. There has also been the news that Press Glass are to build a facility here in the UK, but that is unlikely to be finished at some point in the next year or two. Remember there is also the new facility that has been granted permission at St Helens by Glass Futures, but again, that is going to take a year or two before it is operational.
The glass shortage is here to stay for the duration of 2021. That doesn’t mean there won’t be any glass at all. But it will mean supply is going to be severely strained in parts, and commercial decisions will continue to be made as to who to supply. In short, the biggest IGU makers who are most loyal and pay well will be chosen over those who dual/triple source, are moderately sized and perhaps didn’t do so well on the payments front. I suppose this is where loyalty pays off.
It should ease up by the year-end and into 2022, but for now, we have to get used to the idea of continued and sustained disruption, and almost constant price increases for a while yet.
What to do in the meantime
The forces that are controlling the supply of glass and the price are largely out of our control. There is more demand than supply, which has been exacerbated by the shutdown of two float lines. Demand shows no signs of slowing down and even when the float lines come back online it’s going to take some time to claw some of that ground back.
It means prices are set to keep rising steadily over the next few months, and likely in the high single-digits or double-digits. But there are two things we can all do, whoever you are in the supply chain, to mitigate the issues this is causing.
The first is, to be honest with your customers about the situation. It is well known to everyone so no one should be surprised to hear if there any issues with regards to delivery. Fabricators are perhaps in the tightest bind here, as well as IGU makers. For those installers who buy their frames glazed from their fabricators, if they get let down by their own glass supplier then not only does the fabricator not complete the manufacturing process, but the installer then doesn’t get their delivery of goods, potentially causing havoc to fitting schedules. Keep communications between you and your clients regular and honest. That way companies can plan and allow wiggle-room in their schedules if they can.
The second is to pass any price increases down the chain. I appreciate inflation is rising at a faster rate than was predicted overall, but the public is still sat on a lot of spare cash and can afford to pay the prices that are creeping up. At least for now. We have to continue to rebuild margins as a sector else all this extra business over the last year would be for nothing. Since May of last year, we have proved to ourselves that we can sell at higher and more profitable prices. Let’s keep it that way and ensure the profitability of the supply chain remains strong.
Lastly, hold on in there. There is a way to go yet before this higher level of demand tapers off. Perhaps not until at least Q2 of 2022. But it will peak and drop off and at some point, we’re all going to be able to take a breather and take stock of what we have all just done.
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