In June last year, the trade was blaming a below-par trading month on additional Jubilee-related Bank Holidays and the football World Cup. This time round, there are no such excuses.
In essence, business activity in the early weeks of the summer has failed to match the expectations of many leading mass production joinery companies, despite generally excellent weather. In the architectural joinery sector, good demand has been confined to some specific areas of activity, notably higher-quality private housing work.
Several mass producers have signalled their intention to raise catalogue prices later in the summer in order to help offset higher costs. However, relatively “lean” June trading has been characterised by strong competition among the commodity joinery products – such as internal moulded doors – to the extent that there has been evidence of increasing discounts on catalogue prices. Slightly less competitive has been the market for external doors, where trends continue to favour doorsets and composite doors. Glazed doors, meanwhile, have been affected by a substantial increase in the cost of glass.
Strong market
The latter also applies to timber windows where there is a strong trend towards glazed or factory-finished/glazed products, as well as towards sliding sash. According to a leading mass producer, “the market is reasonably strong and prices are edging up to help us pass on increases in costs from the last 18 months”. Joinery firms have had to accommodate higher timber prices over recent months – partly as a result of the strength of the euro – as well as an increase in distribution and wage costs.
A timber supplier acknowledged that prolonged difficulties with ice had affected timber shipments from the Baltics and Russia, resulting in an increase in prices. However, “flat” demand resulting from “a certain nervousness” in the market place had subsequently led to more stable pricing. Many suppliers have resisted pressure from customers to drop timber prices although some “short-sighted” timber firms have been prepared to “do deals”, he said.
As mentioned earlier, the pressure is falling more on margins than on turnover. A leading timber window manufacturer bucked the trend by declaring a 15% increase in sales thus far in 2003 compared with the early months of last year.
Housebuilders seemed to be relatively busy, the order book remained healthy and lead times were extended, he noted. At the same time, he acknowledged that the turnover increase was primarily the result of selling more value-added product – such as factory-finished and Secured by Design windows – rather than having sold more windows per se.
Sash windows
He also identified a strong trend towards sliding sash windows and wider single sash windows, before pointing to moves among some manufacturers to make windows in easier-to-assemble sections.
Factory-finishing and full assembly are also making inroads into the stairs market in response to a reduction of on-site skills. For the moment, overall demand for stairs remains broadly in line with expectations.
The UK architectural joinery sector has reported a continuation of the strong demand for high-quality residential work and a reasonable level of PFI work involving government buildings, hospitals and schools. Meanwhile, there has been a decided fall-off over recent times in hotel, leisure and wider commercial business – a fact ascribed by many to the damaging effects of the September 11 terrorist attacks. One company which has seen a reasonable flow of orders from the “top end” of the office sector acknowledged that many of the projects related to refurbishment rather than new build, thereby suggesting an underlying nervousness about forward business prospects.
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“Architectural joinery firms are reporting difficulties in finding good-quality joiners, and also problems finding workers prepared to take on greater responsibility” |
Mounting pressure
Margins in the UK’s architectural joinery sector are coming under mounting pressure owing to the combination of strong competition for available business and rising overheads. With regard to the former, several sources bemoaned the fact that they have recently lost out on tenders “even though we felt we had pared our quotation to the bone”. Meanwhile, the costs of timber and other raw materials have increased, while labour costs are continuing to rise. Several contacts expressed surprise at the scale of the latest sector pay deal which will give workers a 20% increase over the next three years. In the meantime, architectural joinery firms are reporting difficulties in finding good-quality joiners, and also problems in finding workers prepared to take on greater responsibility, for example, site management positions. “If four site foremen turned up at my door this morning,” said one, “I would take them all on.”
On the timber side, most joinery firms noted a continuing demand for maple, walnut and beech, as well as the increasing prominence of FSC requirements on tender documents. Several sources reported difficulty in obtaining properly certificated African species such as iroko and sapele “without paying a premium”. One joinery company spokesperson acknowledged widespread supply difficulties out of West Africa and resultant higher raw material costs, but added that he did not want to become a guinea pig for so-called alternative species.
BWF Code of Practice
Following the launch of the implementation phase of its Code of Practice on March 1 this year, the British Woodworking Federation (BWF) has recently begun the process of inspections. The aim is to help bring member companies into line with the good practice standard for a quality woodworking business set out in the code.
According to a BWF spokesperson, analysis of self-assessment forms returned by around 200 of the organisation’s 380 manufacturer members has revealed that around one-third are already compliant with the standard and that the majority of the remainder are close to this “model of a well-run joinery firm”. One of the main problem areas, he noted, was a widespread lack of formal environmental or waste management plans while, of even greater concern, around 20 respondents had no formal employment contracts despite this being a legal requirement.
Among the benefits of the Code of Practice exercise, according to the BWF, has been to focus members’ minds on problems that they might have been planning to tackle for some time, and to highlight to the federation itself where best to target its services in future.
The BWF has also recently agreed new and more rigorous audit procedures for its Certifire fire door scheme whereby a test house will obtain a sample “independently and at random” rather than receiving a sample from the company itself; destructive testing will be added to the procedure from 2004. The federation has also announced that it will be introducing Certifire fact cards on hardware/glazing and doorsets over the coming months to add to one already published on installation and another set to be launched shortly on maintenance.
Fire testing
Chiltern International Fire and BM TRADA, meanwhile, have staged a couple of conferences during June to cover CE marking and testing to European standards for fire-resistant joinery products, including timber fire doors. A spokesperson for the organisers noted: “Around 20% of our fire tests this year have been to the European standard – we are finding that a lot of the larger industry players are working towards this now.”
He also noted that, since durability was becoming an ever more prominent issue with relation to CE marking, BM TRADA had launched a Q Mark scheme for durability of doorsets. “We are now looking to get customers on board,” he added.
The second quarter of 2003, meanwhile, has seen the publication of the new British Standard for timber windows to bring it into line with European standards. As a result, all timber windows must have a base or priming coat on all surfaces and the coating must be of external quality. All products should also feature a BS number; the manufacturer’s name or trademark; and a code identifying the size and type of window.
