Well, maybe there is a little bit of middle ground, but it seems to be getting smaller and smaller by the month. Have you checked out the very long list of new product announcements and innovations over the past couple of years? I’m pretty sure that every single one would fall into the “high-end” category. Has there been any product launches aimed in the “average” niche? Not really.
Value vs high-end
Over the past few years there has been a definite two-directional split within fenestration. One side of the industry has continued to go down the value route, relying on volume sales to bring the margins in, fabricating and installing products that will do the job – the Dacia of windows and doors if you will.
The other side of the industry has gone down the route of superior build quality, premium features and high-end specifications. The type of work that you don’t need bucket loads of, but the margins they command make them very much worth it.
But what has driven this wedge in the industry?
Recession
For me, this split can be traced back to when the recession struck in 2008 and 2009. It was during this time we as an industry urged itself to change, to diversify in order to bring in new streams of revenue. This meant developing and producing new products, which also meant companies had a choice to make: to sell products aimed at the lower value end and bring the business in on volume to maintain a margin, or to seek good profit margins via better made, higher quality products.
Seems most decided to go down the quality route, which is reflected in the very high number of new product launches all aimed at attracting the high-value residential contracts:
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Eurocell – Modus
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Dekko – Raum
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John Fredericks – Rustique 3
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VEKA – Imagine
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Eclectic Systems – Residence 9
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Synseal – WarmCore
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Origin – Twin Flush
These are just a few examples of products that have been introduced either during or post recession designed to give installers that boost to attract the high-end contracts. Nothing budget or cheap about the aforementioned.
Within this split there are sub-splits forming quite clearly, and I think the one that jumps out at me is the lantern roof market. Out of all the diversification this one is perhaps the most competitive and one that demonstrates perfectly the search for the perfect lantern. This certainly isn’t a race to the bottom in this area of the market.
What’s best?
That depends on your perspective. I guess if you’re making profit then you’re ticking the right boxes. But in the long run, at least for the home owner, surely the higher-end of the market produces products that will last longer, be easier to maintain, be more secure and look more aesthetically pleasing?
For home owners looking to sell their home in the short term but are wanting to spruce things up then a budget option window and door is probably the right call. If it’s their forever home then I would say the higher end is the right end. It will need windows and doors that are going to perform, protect a home and look great for decades. You won’t get that from a £500 door.
The middle ground will continue to be squeezed out of the market I believe. The market has continued to move in two clear directions for the past five or six years, and I see nothing on the horizon that is going alter that course.
There will always be a market for the “Dacia” of the window world. The example I’ve used often is the landlord with a portfolio of rental properties that need upgrading. These types of people really don’t care about bells and whistles on windows. The salesman patter of quality, features and benefits has little meaning. This customer simply needs windows and is looking for the cheapest he can get. His portfolio of properties is a business where a return is expected. it is stupid to put the very best windows in a rental property. The magnet kitchen, cream carpets and magnolia… Read more »
I would totally agree with Nick,there are always cheap options customers will take,whether its windows,doors,or locks & hardware,unfortunately this is the society we all live in.Cannot see this changing any time soon,infact this will happen in a lot of industrys.Take a look at car parts for instance,you can go to your local dealer and pay way over the odds or get a pattern part from your local motor factors where it will fit,but sometimes needs a little persuasion to fit,but probably wont last as its cheaply made,for me this will probably never change in the door and window industry,as it… Read more »