In an unprecedented move to communicate the ongoing supply chain problems to the rest of the sector, 19 fenestration sector companies have signed an open letter to the industry in a show of support.
CONTINUED SUPPLY CHALLENGES
Overwhelming demand for construction products since the easing of lockdown restrictions has left many resources in short supply, with much longer than usual lead times.
An industry web forum attended by many of us during the first closure, predicted that post lockdown demand would drift back up to perhaps 70% of normal levels by late September. In reality, most of our industry peers saw demand of 130% within 6 weeks of reopening – initially a huge relief of course, but with that relief came a number of subsequent serious issues.
Basic building materials, such as cement, timber, steel and paints, quickly became and continue to be heavily restricted, along with composite door slabs, uPVC profile, glass and other components.
Manufacturers have quite rightly shrunk back to focus on delivering their core products in volume, and so the huge choices our consumers and retail customers have enjoyed in recent years, are suddenly limited.
These factors have made it much harder for manufacturers, processors and fabricators to manage continuity of supply, often having to deal with last-minute shortages and delays beyond our control.
We fully acknowledge the impact this has had on the ability of our customers to forward plan their own scheduling requirements, and we are constantly working to improve forecasting and communication.
Global shipping costs have risen sharply due to a shortage of empty containers caused by Covid-19. This, coupled with massive demand and competition from Europe, has meant most raw materials and components involved in construction have been subject to overwhelming price rises.
For the time being at least, the days where price could be leveraged with scale of purchasing and volume buying are over, with all levels of the supply chain opting or needing to prioritise margin on a scarce resource over their top line.
This ultimately makes all our products more costly to manufacture and leaves us with no choice but to pass on surcharges and rises to our customers if we want to keep trading. Energy costs are also looming large on the horizon and may prove to be the toughest nut to crack long-term.
Please be assured, only those costs that can’t be fully absorbed are passed on, and, in all cases, limited to the lowest extent possible. This must be an approach taken by every level of the supply chain, with the focus moving away from undercutting rivals to focusing on long-term sustainable business planning.
Brexit has impacted heavily on recruitment in our industry, especially in our ability to recruit and retain logistics and manufacturing staff. This has been further compounded by the ongoing challenges of Covid-19 isolation requirements, which has seen some of our signatories lose 30% of their workforce overnight.
The historic stability of our industry workforce that allowed for high levels of reliability has been replaced with the need to manage a more transient and volatile landscape.
At the heart of this will be a commitment to investing in our people, their wellbeing and job security, and we will continue to focus on training and development across all sectors.
A POSITIVE FUTURE
So where does this take us?
The complexity of the fenestration supply chain today means there have been, and will continue to be, occasions where all suppliers and fabricators are forced to make unprecedented last-minute changes to their production schedules, commercial terms and delivery dates.
We accept the knock-on effect at consumer level can cause unjust damage to the long-standing reputation of strong, resilient businesses who are fighting tooth and nail for their customers and livelihoods. Consumers, on occasion, are also not receiving the service they have been accustomed to.
Our eyes are wide open to this, and on behalf of the wider supply chain in which we all operate, we would ask for your continued patience and understanding whilst we continue to work round the clock to deliver a product and service that you are happy with.
It is categorical that each of the above issues will self-correct and stabilise, only the timing of when this will happen is unknown.
Collectively, we hope this letter goes some way towards explaining the current challenges we are facing, and please be rest assured that we are all doing our utmost to support customers against the odds.
If any industry can adapt and emerge from this year stronger than ever, it’s ours.
I don’t believe in my time in this sector I have seen such a coordinated response from a wide number of different companies. But the fact is, the problems that our sector is experiencing are affecting everyone. They are likely to last a while longer yet, so there remains a need for everyone to collaborate together, be calm, be kind and be as productive as possible.