Whether we want to talk about it or not, the UK economy is on the brink of something bad. Inflation is out of control, the cost of living is soaring and the chances of the UK falling into recession are already highly likely.
This isn’t a UK problem. The US, EU and other Asian economies are all in the same boat. The flood of spending post-lockdown, plus the trillions upon trillions of dollars of stimulus pumped into the global economy to keep it from collapsing has led to the high inflationary environment which is now causing us all major problems.
As a result, consumer spending is dropping, and consumer confidence is actually the worst it has been since 1974. The public faces a tidal wave of rising prices for pretty much everything. Meaningless boosterism is pointless at this stage. As a sector, UK fenestration needs to be proactive now to navigate the hangover of the boom we have all experienced over the last two years.
Act now to benefit later
The tone of the commentary in our sector is now markedly changed since this time last year. Away from social media narcissism, genuine conversations I am having with key industry contacts show a truer picture. Sales are slowing.
It’s easy to say that sales would always slow from the highs we saw in 2020 and 2021, but it is the pace of the slowdown that we have to keep an eye on.
For example, for many fabricators, money is only made once around 85% of the weekly frame output is made. Even a small drop, coupled with rising prices, could cause serious damage to some fabricators who don’t run a tight ship.
It’s imperative that the sector acts now. We know what is coming down the road. You don’t need to be an economist to see the issues that we’re going to have to navigate. So whilst it is tempting to cut back on things like marketing and advertising, doing so only compounds the problem. Why choose to go withdraw further, just as the market enters a tough period?
The sector as a whole has to start ramping up its marketing immediately and in a big way. Installers need to step up in their communications to the public in order to stay relevant and in front of people’s minds. The battle for the public’s attention becomes harder when there is so much more focus on ensuring the basics like food, fuel and gas are affordable.
The fabrication and systems company part of the supply chain has already re-engaged in marketing to installers and fabricators in an attempt to win new business. Remember in 2020 and 2021 how everyone stopped taking on new clients? At our place, the marketing emails are back in full swing.
But the recession is coming, it’s not far away. Failure to move now will mean greater damage during the downturn. However, being proactive now, doing the work and hard yards now will pay dividends in the months to come. It takes time for marketing to be effective. Overnight results don’t exist. The bonus we have is that we can see what is coming our way so we can adapt to the changing economic environment.
A part to play
Unlike with previous crises, the fenestration sector has a direct role to play in the long-term plan of reducing the cost of energy.
The products we sell every day play a vital role in improving the energy efficiency of people’s homes. Right now, that is about as big a USP as you could wish to ask for. Right now, many people are concerned about the rising cost of energy and their ability to be able to pay higher bills in the future. This is an ideal opportunity to become very loud about the benefits of upgrading windows and doors in homes to help offset future rises as much as possible.
I understand that with two years of price hikes, for some families, just popping out to buy new windows and doors may not be an easy task. But it remains very worthwhile selling the benefits of investing in homes and wisely spending it on measures that over a longer period of time limit the amount spent having to run a home.
Whilst this has always been a USP of new windows and doors, never has there ever been so much focus on the cost of living and cost of energy as there has been right now.
Our sector has a central role to play in the coming years when it comes to improving homes and it’s something we must make the most of as we face an economy that looks as though it’s about to be headed towards a prolonged period of challenges.
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