A STRONG LINK


The restoration of a healthy supply chain is critical to a return to the pre-Covid days of plenty, says Louise Walters, Commercial Director for Designer Contracts, the UK’s largest flooring contractor.


During what has been an unprecedented


year for British industry – and the housebuilding/construction sector in particular – supply chain issues have proved a major disruptor to recovery.


What we once took for granted in terms of materials being available at the drop of a hat, has been challenged beyond all recognition. Following the first lockdown when the sector pretty much shut down, the world returned to find a global hiatus in production meant the explosion of pent-up demand could simply not be met. While the orders were there, the wherewithal to fulfil them was not.


Consumers, schooled to believe what they wanted today they could have tomorrow, suddenly found they lived in a world of shortages and delays. We emerged from what had been an age of plenty to what has amounted to a war- ravaged style of rationing.


The construction supply chain was particularly hard hit by a lack of raw materials – particularly when it came to bricks, blocks and plaster. But despite this, and buoyed up by the stamp duty holiday, the housing sector’s Covid-busting performance saw the new-build market hold up well in 2020, with larger housebuilders ‘forward selling’ into the summer.


With the challenges now exacerbated by the new Brexit order, it may be some time before we see a return to anything like normal. Forward planning is going to be key to a recovery which isn’t expected to see a return to pre-Covid levels until 2022.


Supply chain issues are likely to bedevil the sector for a long time to come – and those companies who had the foresight to stock up at the outset are now reaping the rewards of that investment.


At Designer Contracts, our strategy has always been to invest heavily in significant stockholding levels. Even pre-Covid our central distribution facility carried £2m worth of floorcoverings.


While that strategy may have seemed unfashionable in the previous ‘age of


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plenty’ when an increasing number of suppliers adopted a leaner ‘just-in- time’ policy, this is an approach which simply fell apart in the face of supply chain shortages.


Yes, it’s an approach which dramatically reduces the amount of capital tied up in stock. And yes, it’s an accountancy driven dream solution to efficiency. But when it comes to the crunch, it is not an approach which puts the customer first.


When Britain first went into lockdown in March 2020 and the economy was effectively mothballed until the summer, it was clear to the team at Designer Contracts that considerable challenges lay ahead, particularly with regard to supplies. So, as a company we took the decision to significantly increase our stockholding which we are currently maintaining at £2.75m.


It was important to us that customers had the reassurance of knowing that whatever else they might struggle to source, flooring would not be one of them. There have been particular difficulties with the


supply of vinyls, for example, so that is a line we have been at particular pains to have in plentiful supply.


The strengthened stock strategy has proved to be hugely successful for us, not only securing the continued business of existing customers but also attracting new ones who have been unable to secure orders elsewhere.


Going forward we believe that it will be the companies with the courage and conviction to invest in rather than shrink away from the challenges of stock levels who will ultimately succeed. The construction sector’s quite remarkable and unstoppable progress in 2020 may soon level out – but its future prosperity is critically dependent upon being able to access the goods that are the building blocks of its success.


Designer Contracts, which was recently named as a finalist in the 2020 Lloyds Bank Business Awards, operates across 15 UK regional facilities.


www.DesignerContracts.com


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