VIEWPOINT have survived. That was certainly the case in the immediate aftermath of the 2020 lockdown and to a degree ever since, with a number of big PVC-U trade suppliers actively turning down new business. Some of these fabricators will have made a conscious decision not to increase capacity while the market was uncertain, or simply cherry picked the customers they deem to be most profitable, but I suspect others fall under the definition of ‘zombie businesses’ – effectively carrying so much debt that they have nothing spare to invest or grow even if they wanted to.
Is Your Current Supplier A
Zombie? By Martin Nettleton, Managing Director, Euroglaze
The most recent research from Insight Data suggests that there were 35% fewer PVC-U fabricators in the UK in 2021 than there were in 2011 (a decline from 1860 to 1195). There’s no single explanation obviously; some 44 WINDOW NEWS | APRIL 2022
have switched to buying in, some have merged or retired and there have been some high-profile failures as well. Capacity in the market hasn’t fallen but, for installers, the result is obviously less choice and a sense of reduced competition amongst those fabricators who
R3, the UK’s insolvency trade body, estimates that up to 1 in 5 UK businesses can be defined as ‘zombies’ – neither dead nor alive. All the cash they generate goes to paying debt interest, so they have no way of ever reducing the debt itself. Bounce back loans and CBILS are at very low interest rates and banks are much more reluctant to call in loans than they were before the financial crisis. So, unless there is a significant hike in interest rates, zombie businesses can stagger on for years – safely ticking over but unable to take advantage of any new market opportunities. In our market, these zombie fabricators obviously help to maintain overall capacity, but they do little to help those ambitious installers who want to grow and want to work with a fabricator who has the means to grow with them. By contrast, as one of the UK’s leading Rehau trade fabricators, Euroglaze has been actively reinvesting our profits into the business for many years and, never at a faster rate than since the 2020 lockdown. We have just opened a 500m2 factory extension in Barnsley and installed both new CNC saws and new
