A couple of months ago I included information on the site about the increase in business failures in our industry. The Double Glazing Forum website has now added August and September data from the London Gazette for companies ceasing trading from our industry.
It’s not good news, and if you compare with August and September of last year, it doesn’t bode well for the coming months:
In both August and September there are names on the list that were very familiar to me and that I was unaware had gone bust (although, they may still be trading unfortunately).
If you think back to August and September of last year with all the news in the press you would have imagined that the world was coming to an end, yet according to the Double Glazing Forum only 94 companies ceased trading. In comparison, the market seems far more buoyant now with more positive spin in both the national media and trade media, yet in August and September this year 409 companies have gone bust. That’s more than four times the amount of business failures!
Assuming the information on this website is correct (and I have no reason to doubt that it isn’t), it seems there is some sort of lag between an economic downturn, and business failures. If this trend were to continue then the natural peak for bankruptcies in our industry over the winter period could be at unprecedented levels.
But, if this has got you all depressed, don’t worry. At least we aren’t these people!
Tags: double glazing bankruptcies, double glazing bust, double glazing forum, double glazing insolvencies
Did I remind you of this again lol!
There’s one big silver lining in this though, those who stay in business through the winter, stand to make a killing when there are less companies around to take the business.
I don’t like to give away my trade secrets, DGB!
RCG
I have a feeling that a closer look at the companies going bust will reveal the usual suspects of repeat offenders, and others taking a lead from them.Whether at national or local level we all know who they are.
These low life are the curse of our industry, robbing suppliers of their goods and stealing work from established companies that try hard to give their customers an after sales service,and generally taring us all with the same brush creating a negative perception of our industry in the eyes of the wider public.
This state of affairs will continue adfinitum until such time that government get a grip on unscrupulous trading in all sectors of the economy.
However having witnessed at first hand how political parties & government conduct their own affairs, with little morality or ethics, I shan’t be holding my breath.
This time it will be worse. Failures tend to follow a pattern.
Weak difficult markets weaken balance sheets, but many companies manage to hang on so their cashflow just about balances their sales. But when even mild growth comes they don’t have the cash reserve to fund it, to pay suppliers for more materials and to wait for payment. So they run out of cash and die. Financial undertakers call the annual period February to March ‘Death Valley’ for good reason. This time the credit crunch and recession have weakened many more companies. As your chart shows many are already being stretched too far.
Hi RCG
Would I be right in believing most independents import extrusions from Europe, stack it up and then when business comes in fabricate frames. With the Euro at 1.1 to the Pound, they seen a 25-30% rise in UPCV costs along, plus glass prices up 50%.
It makes sense to use up all your pre-order stacked extrusions below throwing in the towel. This may be why some companies have reduced their prices to gain business from customers, who have put even more pressure on them by using the recession as a reason to get a cheaper price.
This will of course lead to spiralling down of prices affecting the whole industry.
We should all be brave, quote the right price for the job, make affair profit and grow your our businesses.
If your company made a profit previously you should be able to hold on until it starts to pick up, which I believe it has.
It nice to be your own boss, but what’s the point if it gives you a heart condition, go and work for a successful company.
Some more interesting statics
companies creased in September over the last four years. Source London Gazette
Sept 06 332
Sept 07 317
Sept 08 469
Sept 09 1915
yes almost four times higher than 08 and six times higher than the trend.
Previous blog should read ‘a fair’ not ‘affair’
sorry being too quick, last should read Creased trading in year upto i.e total of previous 12 months
Hi RCG
Have Anglian Home Improvements joined them too? All their depots and showrooms in South Wales seem to have closed down. Anybody know why.
Thanks
What doesn’t help is all the IBG’s floating about . customers are not fussed about paying a bit more for after sales service . Some would rather pay a rock bottom price and rely on an IBG to bale them out if needed !!
Terry T – I’ve heard the same, but as I understand Anglian have restructured as have many companies, and maybe looked at South Wales as a non-core area.
Kevin – I take your point, but I don’t think IBGs are the fault, but a symptom of the problem.
IBG’s will only cover the cost of the original installation, so if you got a claim and need to replace some dodgy units, you should get enough to pay for some more dodge units and then you can claim again when they fail, or can you?
On the occasions that I been asked to give a quote for insurance purposes, its always been against two or three other companies, guest which one gets the job. yep Fred in the shed.
As for Anglian it appears to be going from strength to strength, like all successful companies it looks at its overheads continually, cuts out unnecessary costs to enable further investment into its products, like its ‘Clear line spacer’, now fitted as standard.