Energy crisis | ANALYSIS
e even more destructive sh businesses’
countless cases of retailers seeing surcharges over the past few months (see September kbbreview). Dwyer says: “In reality, the only thing you can do is to pass those costs down the chain. It has to go to the retailer and the end consumer, otherwise the costs just come straight off your bottom line – and, actually, in some cases those costs will be more than your bottom line.” Adam Mosley, director of Hartford Holdings, the parent company of Thomas Crapper as well as Trojan, Mantaleda and Traymate, explains more: “Trojan’s costs have gone up horrendously. They will more than double next year. While I can’t give you exact numbers, it’s clear that the cost of making each product will, therefore, increase significantly.”
Although manufacturers are gen - erally not committing to any kind of price freezes, most seem to be doing everything they can to keep prices steady. For example, Simon Collyns, marketing and retail director at Symphony Group, says that they are making strategic moves to try not to pass on the increase in energy costs to their customers. “We operate closely and have a long-standing working relationship with our supply chain to ensure price stability,” he says. “Over the coming months, this is going to be incredibly important and means we will be able to minimise price movements to our customers and ensure we continue to provide support and stability to them, too.”
Another British kitchen manufacturer, Omega, is having similar issues with price increases. Alastair England, purchasing and operations director says: “The scale of the increases is such that it is very difficult for us to
absorb them in full, so an element of the increases will need to be passed on to our customers. However, over the past couple of difficult years, we have been able to hold our prices.” He adds: “It is important to Omega that we offer price stability to our customers, so any price increases will be notified with a long lead time, along with future price guarantees to aid future project planning.”
Maintaining the exact stock level or lead times will be challenging for all suppliers who are looking to save costs by reducing production. Omega, for example, is trying to reduce its energy usage by 25% but to keep the same efficiency in manufacturing by using more energy-efficient equipment. Those who have spent the past few years investing in sustainability and reducing emissions are probably now reaping the rewards of this.
The investment in the long-term made a few years ago are coming into play now.
Our kbbreview climate champion and managing director of Crystal Doors, Richard Hagan, has been supporting eco solutions since 2015 and is now in a steady place. In his column in the August issue of of kbbreview, he wrote: “As part of our sustainability strategy, Crystal Doors has invested close to £2 million in energy-saving upgrades since 2015. When our energy prices doubled, so did the savings provide by our solar panels, LED lights, variable speed motors and high-efficiency pumps.” Hindsight is a beautiful thing, and no one could have predicted this energy crisis – especially after such a tough couple of years with Covid and the increase in demand.
But it is a cost that, at the moment, we will all have to bear.
October 2022 ·
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