The changing glass and glazing industry
The 2017 Insight Report is out this month and gives a comprehensive overview of the glass and glazing industry. The report, produced by Insight Data, analyses data from over 15,000 fabricators and installers, as well as sealed unit manufacturers. Insight Data’s managing director Andrew Scott discusses its findings.
The industry is currently facing some challenges with more companies now reporting a slow down in business, some by as much as 15%. However, there are still plenty of opportunities and a number of companies are bucking the trend. The increase in mergers and acquisitions over the last year also points to a realignment of the industry.
The Insight Report gives a full snapshot of the industry, analysing the industry by region, sectors, products, financial performance and more.
According to the report, the IGU sector has witnessed significant change over the last 10 years. The industry had a large number of independent sealed unit manufacturers that supplied window/door fabricators and installers, mainly with simple, easy-to-manufacture ‘squares’.
Consumer demand for larger glazing apertures, combined with tighter regulations around energy efficiency and improvements in product technology, has transformed the sector.
However, while triple glazing has made the headlines in recent years, the volume is still relatively small compared to double glazing, and the debate over whether triple glazing or higher performing double glazing is better, rages on.
It is not surprising then that the market has consolidated with a smaller number of high-volume specialist manufacturers offering a complex array of IGU products. Although some window/door fabricators moved into sealed unit production to gain better control of their supply chains and margins, the complex nature of IGU production has resulted in specialist manufacturers going from strength to strength.
PVCU remains the core ‘volume’ product of the industry. Although the number of PVCU window and door fabricators has continued to decline, those remaining have on average increased in volume, with more companies in the ‘500-1,000 frames per week’ bracket.
Meanwhile, aluminium and timber have made significant gains. Driven initially through the sale of residential aluminium bifold doors, aluminium systems companies and fabricators have identified the opportunity to expand their residential portfolio. As a result, 243 fabricators now manufacture both PVCU and aluminium.
However, it is among installers that the figures become significant. The number of installers now selling aluminium has increased by 39% over the last five years from 4,550 to 6,353 firms, with most of these installers being mid-size or larger companies offering aluminium as a premium alternative to PVCU.
As installers become familiar with offering alternative products and materials, as well as premium ‘timber alternative’ PVCU products, many installers are now adding authentic timber to their product range.
Installers are also offering a wider range of entrance doors. In 2012, the number of installers offering two or more composite door ranges was 550, in 2017 that figure has leaped to 3,031. Meanwhile, traditional timber entrance doors are gaining in popularity while a new breed of featured, residential aluminium entrance doors are entering the market.
Bifold doors continue to be a high demand product both for replacement and new-build markets, as well as extensions and conservatories. However, installers report a notable rise in demand for high specification, large-span sliding doors as an alternative to bifolds.
There is no doubt the industry is changing at its fastest pace since the 1980s. Trade counters are disrupting existing distribution channels while a new breed of ‘builder installer’ is competing with traditional installation firms. Meanwhile, PVCU suppliers are facing new challenges from aluminium and timber.
The established supply chain across the industry is being challenged too, as a series of large-scale mergers and acquisitions has created a shift in power. Those companies that are adapting their business models are bucking the trend and gaining market share.
The full Insight Report provides in-depth analysis of the industry, including product information, markets and financial data. It is available free for a limited period – visit www.insightdata.co.uk/reports