Supply chain health check | INSIGHT
KBBREVIEW100 QUICKFIRE POLL:
Although not back to pre-Covid levels, products are now coming through on much shorter lead
times and where there are still issues, there are usually alternatives available Bill Miller, managing director, KBBG
Also retailers are continuing to place their orders as soon as possible.” Focusing on appliances, Amdea’s Hide reports good news: “Our members tell us that they do not expect to fail to meet the demand requirements from their customers based on the collaborative forecasting for this year, so we see no evidence that
market opportunity will be
prioritised over the more specialised models to give shorter lead times on certain products.”
Many manufacturers have increased their stockholding and found alternative sources of components. The BMA’s Reynolds adds: “An enormous amount of time has been put into finding workarounds and fixes, for example on logistics issues.
stock
“Many manufacturers have increased levels,
involving a significant
investment of working capital. Suppliers have also looked at their own supply chain with a view to diversifying and therefore spreading risks.”
Lead times
Lead times have benefited too, with BMA’s Reynolds observing that “this year, bathroom sector are largely back to pre-pandemic levels”. MHK’s Wheeler has also seen improvements in supplies coming through to his members. He says: “Particularly in 2021 and the first half of 2022, lead times were affected, with delivery times of six months for furniture and many appliances uncommon, but lead times on furniture
not April 2023 •
on the whole are now back at normal levels of four to eight weeks and seem to be stable. Appliance lead times are falling too.” This all led to what MHK’s Wheeler describes as a “stressful and challenging time for retailers” but he adds that his members, like many KBB retailers, saw increased profits and turnover in 2022 as consumers prioritised quality. Both the KBBG and MHK tried to help members’ stress levels by sourcing alternative products where they saw the original supplier might miss a crucial deadline, as well as helping with payment terms and credit limits. Shortages also meant that retailers
had to plan ahead better. As Richard Hibbert, national chair of the KBSA, confirms: “As an industry, retailers have become more organised over the past 18 months in order to deal with supply chain issues, accepting that things have changed and that last- minute orders are no longer available.” So, with signs of light at the end of the tunnel, what is the outlook for the rest of 2023? Miller at the KBBG is upbeat: “We expect that the supply chain situation will steadily improve.
constrained by limited supply.” Good news is also on offer from the BMA on bathrooms, with Reynolds saying: “Supply chain issues for bathroom products have definitely been getting better over the last year and are set to return to normal in 2023. This is through a combination of incredibly hard work by suppliers, and a cooling of demand.”
This optimism is reflected among the membership of buying group MHK, with Wheeler reporting that: “Across the manufacturers we work with, the general feeling is the situation is stable and improving through a combination of manufacturing businesses realigning their offers to their production capacity, closer collaboration with our retailers in terms of order visibility and commu- nication, and the peak in post-pandemic consumer demand subsiding.” Our kbbreview100 retailers confirmed an improving picture, as seen in the results of our recent poll (see box, right). That said, 47% of kitchen retailers said they currently had projects that can’t be completed because of product shortages, so clearly it may still be some time before such legacy issues are resolved completely. Equally, retailers famously have long memories and the reputational damage to some suppliers may last way past the solutions for the supply chain itself.
„ 31 33% 58% 9%
IS SUPPLY GETTING BETTER OR
WORSE? Things have improved greatly from when we last asked our kbbreview100 about the supply chain, when as many thought it was getting worse as thought it was getting better.
BETTER WORSE SAME
KITCHENS
APPLIANCES 16.6% 16.6% 66.8%
BATHROOMS
30% 60% 10%
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