Challenging conditions for today’s architectural glazing industry
Very recently, one of our local competitors went into administration, and here at Dortech, we’re very sad to hear that our industry has lost such a respected company. Our managing director, James Sutherland, reflects on the current market conditions and what this means for architectural glazing brands.
It’s never easy losing your job, or business for that matter, but what was particularly hard-hitting for the Dortech team when we found about the administration, was the overwhelming sympathy and frustration for all those affected. We know a lot of the staff who worked there, and are regularly in contact with many of them, so witnessing this happening to friends has been extremely difficult.
And on a commercial level, the industry issues this represents is worrying.
Like many companies that have been operational for a long time, we’ve seen markets ebb and flow, but what we’re now noticing is that the supply and contracting landscapes are becoming increasingly cost-focused – especially when it comes to equipment procurement and services.
As a result, this can sometimes lead to suppliers making commercial decisions on their prices and offering more and more outside their areas of specialism– which in some cases can lead to a significant reduction in margins. Unfortunately, this unsustainable strategy can quickly lead to commercial demise.
And for contractors, while being budget-savvy isn’t a bad thing at all, the old adage ‘buy cheap, buy twice’ has never been more relevant than in today’s society – whether in the construction sector or otherwise. For both suppliers and contractors, low prices for quality products isn’t a sustainable option, so industry professionals need to think again when they see a ridiculously cheap quote. In other words, the long-term quality, reliability and lifetime cost of the assets involved needs to be questioned.
Another sector-wide trend – due to competitive market pressures – is seeing suppliers seeking to provide packages outside their area of specialism in addition to their own. And this under-priced, package-like approach – while it may seem easier to manage for the contractor – can be very damaging not only for contractor-supplier relations but for businesses’ livelihoods. Especially given that it can take between 70-90 days from the point of order before a supplier receives payment for the design, equipment procurement and manufacturing works carried out. To combat this, suppliers need to be resolute and offer only their specialisms, and contractors should prioritise expertise and quality over initial pricing.
Unfortunately, the construction market, in some cases has adopted a short-termist attitude, and until this changes the cycle will continue – some main contractors will procure on the basis of the cheapest price, suppliers will go bust and the cost of maintenance, rectification work will soar and of course the final cost is ultimately higher!
We’re very sorry that this has happened to a company with so much heritage, expertise and industry respect, and our warmest wishes and offer of support go out to all employees and customers who have been affected by the business closure.