The Crystal Group Comment: Q3 2021

2021 is turning out to be a game of two halves, as a buoyant Q1 and Q2 have made way for a tail off in demand in Q3 and perhaps – finally – a return to normality.

Normal service has resumed for raw material and component supplies, with resin, PVC-U profiles, and glass all readily available. We aren’t entirely out of the woods on supply issues, but we seem to be over the worst of it.

The availability of materials in Q3 has moderated the stream of price rises we saw earlier in the year. We expect to see an end to additional surcharges by the end of the year too.

Digital sales were the driving force behind half of our own Q3 sales, and as many merchants will agree, a mix of clicks and bricks is necessary to stay competitive in the building industry. Hence our rollout of Crystal Window Centres for the merchants is gathering pace.

As we move into Q4, and COP26 discussions draw to a close, sustainability is top of the agenda. We’re confident there will be another incarnation of the green homes scheme in 2022 under a different name, and a push for windows to be classed as primary measures. While the government is championing subsidies for costly air source heat pumps, it makes sense to ensure homes are well-insulated, so they don’t waste energy.

As well as thermal efficiency, we are seeing increased interest in noise abatement windows. Many new housing estates are being built on brownfield sites near roads or rail lines, and developers need windows which keep the noise out. They will also need to be retrofitted to homes affected by the HS2 project.

The big watch point going forward will be cash flow, as the industry recalibrates to new levels of demand and a backlog of orders. A lot of money is being spent on buying materials and components, but with lead times extended to 8-9 week or more before jobs are completed, suppliers, fabricators and installers could struggle before the money comes in.

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