The one question everyone is asking is when the supply chain will return to normal. For over a year our sector has had to cope with steep and constant price increases, product delays, shortages and ever-extending lead times.

But there is a way, even two, for the supply chain to return to normal.

Reduction in spending

One of the main reasons for the problems in the supply chain is both domestic and international demand. It’s very high. After multiple lockdowns and hundreds of billions in government support, there is a lot of money in people’s pockets. Depending on the report you read, it’s anywhere between £150bn-£350bn. That is going to take a significant amount of time to spend. Even if people do up their spending on big-ticket items like cars, kitchens, doors and holidays, it may not drain their accounts.

The other boost in spending has been on infrastructure. Homebuilding is a good example. The Government has a target of 300,000 new homes per year for the next five years. That is going to take significant resources and materials. And with builders both catching up from delays caused by lockdowns and attempting to meet demand from the public, housebuilders are sucking up a great deal of the material demand.

If, however, spending in these two areas suddenly drops, or levels off at a more sustainable level, the pressure on the supply chain will alleviate. Demand for materials will drop to more manageable levels and will give companies more time to build back stock levels as well as reduce stress on the workforce.

The bad news? There are no signs right now that this is about to happen. One systems company in the UK fenestration sector even believes that we’re at the start of a FOUR-year cycle of higher levels of demand for home improvements. Personally, I think that’s a tad optimistic. Speak to others and the consensus is that this level of demand is likely to last until at least Q2 or Q3 of this year, maybe to the end of the year, then it drops off. If this is the case, then it means the strains we’re under now are going to be here for at least another year.

Immediate increase in capacity

The other way the supply chain can return to normal is if we can find a way to immediately and significantly increase output and capacity.

One of the reasons we’re in this state is that in most parts we’re at capacity. We have a bizarre scenario where most major suppliers are NOT looking for new business. How many ever thought we’d be in that position? Yet here we are. We’re all full and we cannot take on any new customers in any significant way.

I am aware of a number of fabricators actively looking to increase both storage and production capacity to be able to meet current high demand. That is easier said than done. New units aren’t always available and the money needed to invest to buy new machinery and storage facilities isn’t cheap. But fabricators are under pressure to find ways to ease the strain. If you’re a machinery company right now you’re perhaps in the only part of the sector actively taking on new customers. This really is boom time.

On the whole though, the ability for the entire sector to be able to scale up quickly isn’t there. Not only that, wider global supply chain problems with polymer, glass, hardware, transport and labour makes that ability to scale up even harder.

So in the end, unless the above two scenarios manifest quickly, what we have now in the new normal and we’re simply going to have to get used to it. 2023 may be the year we might largely return to normal working paradigms, but that is a way off yet.

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