From David Ruzicka, Joint Managing Director, Sash UK
Since the recent Glasstalk event, I have taken a very close interest in the feedback generated on the RCG site.
It seems that a number of issues that I raised have been somewhat misconstrued, and I would therefore like to clarify these issues in more depth than I was given chance to at Glasstalk.
First and foremost, I am not afraid of the competition posed by any company in today’s market place, nor would I like to operate in a monopolised industry. Sash UK has competed very successfully for almost 45 years and it is the presence of other fabricators that has driven us to become the market leader that we are.
However, what does concern me is the unsustainable number of extruders, fabricators and, to a lesser extent, installers currently operating at each level of the window supply chain. The domestic and commercial window replacement market is probably around 30% smaller than it was 3 years ago, and there is simply not enough business to satisfy everyone.
This is not to say that I fear for the future of Sash UK, but rather for the future of many other companies throughout the industry who will find it increasingly difficult to win a sufficient share of this business. Those who fail to do this, and subsequently go into administration, do so at the expense of others in the industry i.e. their creditors, who then have to shoulder the cost of this over-saturated market.
Therefore, phoenix fabricators, who are unlikely to survive in the long-term, and also those who supply these fabricators are only adding to this increasing problem. That said, I must concede that there are a number of fabricators who are guilty of indulging phoenix installers and they too have a part to play.
With specific regards to the number of extruders, I think that we could easily merge many of these companies, whilst retaining the individual brand identities, and thus have a smaller number of more successful and profitable organisations. This would also allow for more investment back in to the industry.
Once again, I hasten to add that this is not because I think that trading conditions would improve for Sash UK, but instead because I sincerely believe it would improve the industry as a whole and benefit everyone involved.
I hope that this clarifies what was said on the day for those who did not fully understand my intentions. I would also like to take this opportunity to thank the organisers and sponsors of Glasstalk for what was a very enjoyable and productive event.
Tags: dave ruzicka, extruders uk, phoenix operators, Sash UK, window fabricators
Loading ...
There is considerable precedent, is there not, of the merging of system brands and a subsequent reduction in output? The halcyon days of Heywood Williams saw the acquisition of many extruders and their brands, to see the manufacturing resources then rationalised and in time, many of those brands disappear. And that was in the ‘good times’.
Survival of the fittest.
Hi Dave
I was at Glasstalk and took in your comments regarding phoenix companies and what the industry can do about it.
I have been in this industry for many years and know of many installing companies that have gone into liquidation and opened up the next day with (UK) or similar in their title but kept the same trading name. In many cases the new company buy from the liquidator the assets and order book. In the criminal fraternity companies that regularly did this were called long firms.
I am involved in the Insurance Backed Guarantee Business and my insurance supplier requires that if a director of a company goes into liquidation or bankruptcy he must sign a declaration to personally guarantee the former companies works to be eligible to insure through the same insurers.
The industry does not have a governing body to stop this but a quite simple solution to this is if FENSA and CERTASS were to suspend company directors that had put a company into liquidation for a period of say 5 years. I appreciate that they could always use the spouse or other family member to join these organisations but it might make them think twice before downing a company.
Perhaps if fabricating companies were to get personal guarantees from directors of companies that in the past had experience of liquidation of a company.
the Double Glazing industry the same as all other businesses will always have plenty of competition but we should be playing on a level playing field and I fear this is not the case with phoenix companies dumping their creditors and customers guarantees.
I agree with much of what Paul Glover posted above.
With regard to guarantee’s, they have gained a discredited image with the public primarily because of their exaggerated length and association with defunct companies.
Example:
A recent poster on here proudly stated their timber windows were guaranteed for 30 years. Against what?And who with? How does the installer figure in this- the only point of reference for the customer?
What other industry continues to shoot its self in the foot like this? Try getting a builder or a heating engineer back after 9 years to undertake a FOC repair.
The industry needs to grow up and introduce a standard realistically framed guarantee of say 5 years, and cease cynically using guarantees as a sales tool.
Maybe FENSA could take a lead on this.
How many times was Richard Branson bankrupt before he made his millions? High risk high reward. How many of Sash Uk customers have previously gone down owing other fabricators money?
Unless, anyone knows otherwise I don’t think Richard Branson ever went bankrupt a few times he came close but never actually popped. Shrewd man that Branson you know !! And a nice guy too.
There is no doubt in my mind that there are people out there who systemically go through to rip off their creditors, but be careful not to put everyone under the same banner.
Phoenix companies whatever they call themselves can be a better company than the one that went.. Alot of you are fortunate enough to have good cash flow to fall back on and a wide customer base, you can manage wisely and effectively you can project the future. What you can’t manage your way out of is a big hit if it smashes your cash flow to pieces and the banks aren’t that helpful to help you ride the storm.
I’m very fortunate this year to be in a better place than I have been for many years going into Christmas and the New Year, but I’m sure there are alot of people reading this blog worried about their cash flow for the New Year, and is it because they are bad people, NO probably quite the opposite, nice people (the majority) who don’t want to consume competitors and lay off there staff to increase profits, people who pay other peoples wages before their own, people who are hard working and don’t know what else to do.
Let me just ask one question, if for some reason your company went tomorrow what would you do? Would you go and do something else? Or would you get back to doing what you know in order to put food on the table? Before judging other people think what would you do…? I’m not talking about the scumbags you can P..s O.., but the people in our industry who do care about the fact that they are going to be letting people down by not paying them..
The fabricators and extrusion companies should be able to judge for themselves who are the rogues and who are genuine, and if they support rogues well in my view they deserve to get a kicking, they knew what they were getting themselves into.
Hi Andrew
I agree with your sentiment. I don’t think anyone in the industry has a problem with a company or individual who has hit hard times through no fault of their own, and having acted throughout to protect as many individuals, suppliers etc as possible.
It’s those that haven’t tried hard, who have acted improperly, who haven’t behaved with dignity and with due care and attention for those around them, that people feel so strongly about.
RCG
Hi RCG
I respect what Paul Glover’s supplier is trying to do, but the following in his post is in fact illegal under company law,
“I am involved in the Insurance Backed Guarantee Business and my insurance supplier requires that if a director of a company goes into liquidation or bankruptcy he must sign a declaration to personally guarantee the former companies works to be eligible to insure through the same insurers.”
Regards
Alex