The market showed a strong performance 2013-2016 with a flattening out in 2017. There are challenging prospects and little or low growth forecast short term. Longer term the outlook is mildly optimistic with lower growth forecast than in previous years but for a return to average growth post Brexit. Key defining factors in this market in 2017-18 are unchanged over the previous period: market maturity (in particular for the domestic replacement market), fragmentation, competition, cost-management, building legislation, ‘green’ building, tough market conditions and diversification. But the economic scenario has changed.
The development of the economy is a key factor to the glazing sector, impacting on consumer confidence, housebuilding, public spending and commercial construction output. Forecasts are for a less positive economy and uncertainty amongst the political, business and consumer sectors seems likely to continue over the next 2-3 years as negotiations with the EU continue.
There is significant over-capacity in the industry resulting in an intensely competitive market, especially in the retail PVCu sector – prices and margins remain under pressure as companies compete for business. Fabricators have responded to consumer market demand by broadening their range with alternative materials, styles and technical improvements to capture preferences through new styles/colours, triple glazing, bi-fold and composite doors, PVCu mechanical jointing and with greater thermal and security features.
The supply structure remains very fragmented, comprising a mix of vertically integrated retail glazing companies, PVCu trade fabricators and fabricator/installers, aluminium systems fabricator/installers, bespoke glazing contractors, composite door manufacturers, commercial glazing specialists, roof light manufacturers, steel window manufacturers and major joinery companies as well as others. There have been a few closures and acquisitions/mergers since the last edition of this report and some major changes among the larger firms.