Safestyle are gone, with the brand and order book swallowed up by Anglian. Everest, as of last week, are now in administration, with buyers sought for the ailing company and hundreds of jobs on the line.

There has been a plethora of bankruptcies over the past few weeks and months, to the point where it’s been hard to keep pace with the rapidly changing landscape. It has been across the board, with installers and suppliers being hit as hard as each other.

But one thing that most of these administrations have in common is the business model. Companies that rely on mass volume at low margins. It’s a risky strategy in a subdued market, and so we have seen the results.

With only one last household installer name left, Anglian, are we now looking at the end of the national installer business model?

Big mouths to feed

National installers of windows and doors have been around for decades. Anglian and Everest are and were both over 50 years old. They were household names in an industry that at that time was just about getting to grips with PVCu windows. Everest was perhaps the one with the strongest brand recognition at the time, and even those that were not born then will remember the Ted Moult adverts, especially the one at the Tan Hill Inn:

At the time, PVCu was taking off in a huge way, and punted aluminium and timber windows to the back burner. PVCu quickly became the primary material choice for homeowners, and so the likes of Anglian and Everest, as well as others, boomed. Then Safestyle came along and joined the White Gold era which made a generation of people in fenestration very wealthy indeed.

These companies became big beasts. However big beasts require a lot of intake to keep them fed and functional. And as with all things, change stops for no one. But the methods of national installers did not. Hard-selling, door canvassing and aggressive sales tactics remained even whilst the general public became wise to their methods and were vastly more educated than previous generations of customers thanks to the internet. So whilst smaller to medium sized firms adapted and changed, the largest, like huge shipping vessels, continued on their immovable path.

And so what many thought would always happen, happened. Last October we saw the demise of Safestyle UK, with the loss of hundreds of jobs and the order book and brand being bought by Anglian. Now, just six months on, Everest have fallen to the same fate. Both companies running out of cash in a tough market operating a model that was not fit for the times. What happens to the order book of Everest remains to be see, but we are now down to one of three household name brands.

COVID shakedown

They say it takes a good crisis or recession to shake off the deadwood. It appears we are seeing the same thing happen right now. The industry exploded with demand as the first lockdown ended. As a result, everyone grew at rates few had ever seen before. Then hyper-inflation struck and a few months later began an 18 month cycle which saw rampant price increases across the board. The country as a whole saw inflation rise rapidly, which walloped everyone.

And then the inevitable slowdown came, and as the shore went back out we would see who was wearing swim shorts, or however that saying goes. Turns out, quite a few were caught short and what we are seeing play out right now is the hangover of that boom.

As for the nationals, the bigger they are the more volume they need to keep their low-margin models afloat. They never changed. Their entire business was based on selling mass volume at low margins with a view to beating others on price. That can only work in an affluent market, which we certainly are not at the moment. Then factor in higher production costs, higher labour costs, higher transport costs etc and you find yourself quickly running out of cash. If you cannot continue to feed the beast, then that beast dies.

That is why smaller to medium sized firms manage turbulent times better. They are quicker to adapt, change/add products to their portfolio, update business models and generally do the things required at pace to accommodate the moving market. In times like these, the smaller you are generally the better you fare.

For me, the national model is firmly a thing of the past. First, their sales methods are archaic and a good portion of the general public do not want to be sold to in that manner. They’re far more educated and do their research before they approach companies for quotes. Drop closes in the home after 5 hours of demonstration has to be confined to history. Second, mass volume in a stagnant economy just does not work for installers. There are far too many overheads, which have only become more expensive over the last few years. Those models should have switched to a digital-first channel, focusing on the quality of the product and service. Something smaller firms can do better. Third is the marketing itself. I have not seen a good TV advert for double glazing ever – stop wasting money on TV ads. The generation you want to buy windows doesn’t watch anywhere near as much TV as you’d think, and they skip past the ads! We are very much in a digital age and both Everest and Safestyle should have committed fully to becoming more streamlined and adapting their businesses to the digital age.

Once the industry carnage is over and the number of companies is smaller at the end of this year than we started with, we are going to see a brilliant opportunity for high quality, smaller firms make the most of the newly available market share. The mass-volume, low margin national installer model is no longer viable in my opinion and what we are most likely seeing are the final days of this era of our sector.

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