The second quarter of 2004 appears to have yielded a slight upturn in business for some of the UK’s leading mass production joinery companies, partly as a result of the demise of Dale Joinery. However, demand from the industrial and merchant sectors over the past three months is described generally as nothing better than static to flat.

Recent interest rate rises – and the strong possibility of more to come before the end of the year – have created an element of nervousness in the joinery market. This sense of unease has been heightened by suggestions that some housebuilders are thinking of cutting back on their new start programmes. A number of companies reported that first-half sales had been slacker than anticipated although most expected to end the period roughly on budget. But with raw material and energy costs on the increase, joiners have had little scope to widen their margins.

The collapse of Dale Joinery Ltd has allowed other well-known names in the industry to scoop up some major accounts. However, one of these beneficiaries said that, despite a minor improvement in sales to the merchant sector, the market lacked “buzz” and orders were “a little bit below expectations”. A spokesperson attributed these conditions in part to disruption of the manufacturing cycle caused by companies extending their bank holiday breaks. Another leading company confirmed that the loss of Dale Joinery from the market had had a positive impact – albeit difficult to quantify – on its own first-half figures. “We are up on last year in terms of volume sales but margins are as tight as ever,” a spokesperson told TTJ.

Of course, it should be noted that the window plant at Dale Joinery (Lichfield) Ltd is still in production following its acquisition by former Palgrave Brown managing director Richard Fawcett. Speaking to TTJ this week, he said that demand for timber windows appeared quite strong and that, over the coming months, he might look to address “a capacity constraint” with respect to fully-finished, factory-glazed product.

Public sector demand

Demand for fully-finished windows continues to dominate this market. Other trends noted this week included growing demand from the public sector for higher-specification products, which has prompted JELD-WEN to launch a clear timber combi window product. According to a spokesperson, other clear timber product releases could follow.

Another timber window specialist reported quieter sales of sliding sash windows but an increase in demand for traditional casement windows, thanks largely to an upturn in orders from the social housing sector.

Recent months have seen some joiners introduce modest price increases on their timber products, partly in a bid to offset rising energy and raw material costs. “There isn’t a single sector of the market where price increases aren’t being sought,” TTJ was told by one. Another pointed to the rising cost of glass and steel as justification for plans to apply a price increase of around 5% across the board in the near future.

These higher prices had made the door market “a little less cut-throat”, according to a major producer. He highlighted the ongoing trend towards doorsets and factory finishing or, as he put it, “towards offering the customer a complete solution rather than him needing two or three different trades”.

The stair market has remained reasonably busy although one major manufacturer pointed to a dip in demand over recent months. He attributed the decline to the growing shift in the new build market towards maisonettes and flats.

Looking at wider trends, there were predictions this week of further consolidation within the UK mass production joinery industry as well as talk of an increasing requirement from some sectors – such as self-build customers – for higher specification joinery products, thus offering manufacturers scope to improve their margins. One leading producer highlighted good demand for “internal doors that have a higher-spec look but hit a lower price point in the market”.

&#8220We are happy that there is business out there, but no-one is breaking down the door”

Demand levels in the UK’s architectural joinery sector regularly vary from one region to another – and the second quarter of 2004 has been no exception. Most firms appear to have been fairly busy in the first half of the year although many are anticipating a reasonably quiet summer period. “There is not a mass of work – it’s not as buoyant as I thought it would be at this stage,” TTJ was told. “We are happy that there is business out there, but no-one is breaking down our door.”

In general, private residential contracts have continued to come through, but commercial fit-outs and government-related joinery work appears to be less available. In terms of material trends, North American maple, cherry and walnut remain popular although, at the same time, a couple of contacts identified an increased demand for stained hardwoods and for “anything that takes paint well”.

Rising costs

Architectural joiners are also having to contend with margins rendered ever tighter by rising costs, with a number of companies claiming that any price increases achieved in the first half of the year have barely covered inflation. As well as rising hardwood/board product costs and the effects of the increase in oil prices, firms are also having to assimilate a recently-introduced 7%-plus wage rise. This latest increase will undoubtedly boost the attractiveness of a career in joinery but advertising for new recruits is still producing a generally poor response, several companies commented.

The quality of new staff is also an issue, with many joinery firms now opting to take on young people for a year before making the financial commitment to train them. “This sorts out the ones who are going to get bored, those who are not reliable and those who won’t make the grade,” it was explained.

Customer demand for material “proof of source” is also adding to costs in some instances. In this context, however, several firms confirm that FSC accreditation has won them invitations to tender for contracts that would have otherwise been denied to them. On the same subject, Timbmet Group recently became the first UK importer to be certified under BM TRADA Certification‘s Forest Products Chain of Custody Certification Scheme which covers forest certification programmes other than the FSC and PEFC initiatives.

Many architectural joinery firms maintain that customer demand for chain of custody assurances still amounts to “no more than a trickle”. One observed: “We continue to wait with bated breath to see what the government will do regarding its stated aim of getting more timber to come from certified sources. At the moment, chain of custody arrangements are still not as organised as they could be.”

New relationship

A joinery management training scheme is likely to be one of the positive results of the new relationship forged between the British Woodworking Federation (BWF) and the Construction Industry Training Board, which is now known as CITB-ConstructionSkills. During its analysis of the results of a membership survey carried out late last year, the BWF identified “a real gap in management and estimating skills”. According to the federation, a qualifications scheme is being planned that will enable joiners with all the necessary craft skills to progress into management. “This will help give people a career path and will therefore encourage them to stay in the industry,” TTJ was told.

The BWF has also announced that the formal relaunch of its Timber Window Accreditation Scheme will take place on July 2. To be re-branded as the TWA Scheme, it will be given a new logo, and new promotional material is being produced for a recruitment drive. Formal links with the British Standard kitemark scheme will be announced on the same date: all TWA Scheme factory-finished windows will also be entitled to carry the kitemark because both schemes will be operated to common technical standards. According to the BWF, this will mean even more rigorous audit requirements for scheme members.