Bringing Back Seasonality

Sales and Marketing Director Matthew Carter looks for normality in 2022

Reading the market and predicting demand has never been more challenging and the last eighteen months have been a bit of a rollercoaster for us all.

The unprecedented lockdown of 2020, followed immediately by a quicker, more dramatic upturn than anyone expected was tricky enough to navigate. Then we had a year of unexpectedly sustained demand topped off with some of the biggest cost increases we’ve experienced in decades.

Nothing about this market is predictable or consistent. There is big money to be made by manufacturers prepared to release customers and chase the short-term profits to be had on the spot markets. 

For those of us who try to deal fairly with loyal trading partners, the focus has been and continues to be on difficult conversations around finite capacity and the realities of manufacturing.

We don’t have a market slow-down on our radar, not yet. The RMI market appears to be levelling off – perhaps in response to rising living costs or perhaps because of labour shortages – but the housebuilders are positive, certainly for the first half of the year.

So our challenge remains to manage demand. For a company that has always taken pride in consistency and the ability to deliver on our promises, this year has been bruising.

We have rarely supplied product directly from our factories, we supply from stock. It’s the blocks in our yards that provide consistent and predictable deliveries. 

If we have no stock, then every time there is a hiccup in production volume the impact is felt immediately by our customers. Letting our customers down when they are expecting deliveries is not what we are about.  

This problem only gets worse when the factories have been operating at 100% capacity for well over a year. When demand is strong and customers are crying out for product to meet their build schedules it makes sense to work through traditional shut-down periods.  

Meeting immediate demand is certainly an effective short-term solution, but any factory needs regular maintenance in order to deliver consistent production. Ours are no exception and we have to reinstate our routine maintenance shutdowns in order to provide the longer-term predictability that we promise to our customers. 

In addition, we have several long-planned improvements to the factories, representing a significant capital investment in the long-term efficiency of our existing facilities. These too need to be scheduled and cannot be put off any longer.

And finally, we need to return to our managed stock process to make sure we can guarantee our deliveries and hedge against any unexpected interruptions to the manufacturing of individual product lines.

It’s not great news in the short term for our customers as there will initially be a reduction in the volume available to market in the first quarter of 2022. This is following the normal seasonal pattern where December, January and February are quieter months, allowing us to reset and prepare for the months of stronger demand. 

Nothing about the last eighteen months has been remotely normal. We are anticipating strong demand next year and preparing to meet it consistently and with predictability, which for H+H means a more typical, seasonal supply cycle. In very abnormal times we are putting all of our effort behind providing the normal, reliable supply patterns that support our service promise to our customers.