June 25, 2021

Coping with the Supply Chain Issues

Coping with the Supply Chain Issues

GGF Senior Technical Officer, Ben Wallace provides an update on the challenges facing companies in the glass and glazing supply chain and puts forward some recommendations for GGF Members in order to cope with the current issues.

As the toll on human health from the spread of Covid-19 is evaluated, the economic effects of the crisis and the livelihoods at stake are also coming to light. At the GGF we are hearing of extensive delays within the supply-chain of the glass and glazing industry, and throughout the construction industry as a whole. GGF Members must respond on multiple fronts at once, at the same time that they work to protect their workers safety, they must also safeguard their operational viability now increasingly under strain from a supply-chain shock.

As well as Covid-19, other factors have led to disruptions causing the slowing of the construction supply-chain, including; container shortages, factory fires and the recent blocking of the Suez Canal. This has already led to the current global shortage of many materials used within our industry, and more recently the supply disruption of another critical category of materials is occurring – plastics. Constraints on the supplies of their raw materials, especially polyethylene (PE), polypropylene (PP), and monoethylene (MEG) are leading to factory shutdowns, sharp price increases and production delays across the construction sector. It is not un-realistic to believe that this will have a knock on effect for both Un-plasticised Poly Vinyl Chloride (UPVC) and Poly Vinyl Chloride (PVC). 

With two float lines down at major glass manufacturers and interlayer shortages, especially with Polyvinyl Butyral (PvB), laminated glass supply is being allocated. We are also receiving reports of extensive delays throughout IGU production. It is important to understand that there are underlying uncertainties in the forecast for both the short and medium term.

We recommend that GGF members should:

  • Create a clear plan throughout supply chains, establishing a list of critical components, determining the origin of supply and identifying alternative sources. As we open up a global UK we have an opportunity to identify new supply chains from alternate global regions.
  • Estimate available inventory along the chain for use as a bridge to keep production running and enable delivery to customers. It’s now more important to test the resilience of material supply chain through business continuity scenario planning.  
  • Assess realistic customer demand for both the short and medium term and ensure you manage your customers’ expectations.
  • Optimise production and distribution capacity to ensure employee safety and engaging with teams to share infection risk levels and work from home options. These steps will enable managers to understand current and projected capacity levels in both workforce and materials.
  • Understanding where supply-chain issues will start to cause a financial impact and protecting your company against future supply-chain price increases.

With the positive news that the glass and glazing sector has bounced back relatively quickly under difficult circumstances, and homeowners are continuing to invest into their properties, it is important that members formulate a strategy to balance demand against a slower supply chain. Members should note that lead time extensions and price fluctuations may be factor throughout the second half of 2021 and into 2022.

With this is mind, management of demand and lead times is essential and consumer facing members need to make their customers aware of potential delays. Dates and prices agreed with homeowners must be achievable.

On a positive note, with the heightened supply chain awareness and knowledge Covid-19 has brought, it will better our position to continue managing our industry through any future challenges that may emerge.

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