Crystal Group Comment: Q2 2022

After a rocky start to the year, the challenges for window and door suppliers have continued into Q2, as we battled against the legacy of Covid-related supply chain issues, difficulties caused by the war in Ukraine and the realties of Brexit finally becoming apparent.

Many merchants are still reporting increases in sales for windows and doors, but this is giving a false sense of security as much of the uplift is driven by price increases rather than volume. The wave of material price increases are forecast to continue and need to be passed along. Manufacturers margins are being eroded by minimising the amount passed on, but that’s not sustainable in the long term.

Suppliers, fabricators and installers are reporting a year-on-year drop off in sales of between 25-30%. We’ve never experienced such a sharp decrease in demand but there could be many reasons for it. This summer is the first since 2019 that holidays abroad are back on the cards and some homeowners would rather spend what savings they have on travel than home improvements. Household spending is being reined in, as the impact of food and energy price increases bite.

With consumer uncertainty likely to continue into 2023, we believe a ‘grown up approach’ is required to ride out the storm. We’ve had to re-evaluate our business model over the last quarter and adapt to trading conditions to stay competitive for our customers and viable as an operation. As demand picks up, we’ll build back better.

Change is never easy but burying your head in the sand is not the answer. If you spot a downward trend, you must react quickly to minimise losses and look for new opportunities to adapt and diversify.

We’ve recently expanded our selling channels to attract the growing number of online buyers in consumer marketplaces who want windows and doors, we’ve increased our ‘drop ship’ offer and expanded our product portfolio by partnering with other businesses.

Moving into Q3, we hope there’ll be a bounce in confidence with a new Prime Minister, particularly if they focus on inflation reducing measures. Until then it’s business as usual, with a renewed passion for innovation in the face of adversity.

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