on the board A year of new challenges
It’s not unusual at this time of year for a business to reflect upon what has happened in the preceding twelve months and to refocus on the year to come. However, 2021 has been no ordinary year for anyone in the UK - including all those involved in the housewares industry. As we face what is looking set to be an equally unpredictable 2022, what thoughts and learnings can we take from 2021? Roger Murphy, managing director of Eddingtons, reflects.
strange things can happen to pricing and availability in the short to medium term whilst things start to settle down again. I think some of this will be temporary as the balance of demand versus supply adjusts moving into 2022, and we will hopefully see freight rates - our single biggest company challenge currently - start to come down a little. Sometimes, in order to achieve some context, you need to put events into a historical perspective - and if you look at the wider UK economic situation, then the last ten years have been “One Tough Decade” to navigate! For any of us buying product in US dollars, we’ve seen a dramatic fall in the value of the pound, then the uncertainty of the Brexit vote followed by the uncertainty of the Brexit implementation… and then along came COVID.
If we’re honest, with the benefit of hindsight following the Government’s tightening of COVID restrictions in December 2020, we all knew we would have to contend with the pandemic across 2021. Listening to worrying noises from South Africa on new variants, COVID will continue to figure prominently for everyone in our Industry throughout the coming year. Leave aside the impact on consumer demand and the global supply chain, this virus will have a lasting legacy as the single biggest catalyst in my lifetime for fundamental social change in how we live our lives, purchase goods, how and where we work and socially interact, and how we view the freedom of the individual versus the collective needs of society. Since the first March 2020 lockdown,
we’ve all had time to adapt to a working life with COVID ever-present. What we probably didn’t see coming in the second half of 2021, however, were all the other events that formed part of the ‘COVID Aftershocks’. As global supply chains stretch and demand exceeds supply,
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This summary isn’t meant to sound like a Country and Western ballad (“just when it couldn’t get worse… it did!”) It’s exactly the opposite for everyone involved in our industry, retailer or supplier. The last twenty or so months have been tough, stimulating and challenging in equal measure, and forced us all to review everything we do to continue to operate in difficult trading conditions. Let’s pause and celebrate the fact that we’ve got where we have. We know so much more than we did coming into 2021 and there is every reason to believe that, as an industry, we will weather whatever the next year throws at us. Will freight rates come down to pre-
COVID levels? Not likely and not anytime soon. Will inflation pick up pace in 2022? Probably, given the increases we all face in our businesses - but for older members of the industry, inflation through the 1970s and 1980s was an ongoing fact of life. The last 30 or so years has made us think that inflation is no longer a variable that we need to contend with. Will COVID continue to shape the agenda in 2022? It probably will, and equally I’m sure our individual and collective ingenuity as an industry will continue to see us through.
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Closing with some positives Consumer demand in our industry remains solid. At Eddingtons, our independent channel is already back to near 2019 sales levels. The shared response from buyers and sellers to price increases, freight charges, availability of product and delays has been, by and large, fantastic. We’ve worked together on an external challenge that isn’t about point scoring or blame allocation, just about how we can try to make things better. Our industry recognises that there’s been something bigger than all of us at play as a result of COVID, and that has resulted in more cooperative discussions on how best to move forward. It’s also highlighted that in a supply crisis, availability undoubtedly trumps price. Which, let’s be honest, doesn’t happen often in negotiations! A video call is many times better than a phone call, but it doesn’t come even close to a face to face meeting. Looking at a product through a laptop camera can’t come close to touching and feeling and considering it in your hand. Visiting trade shows and industry award dinners has seen a collective rekindled enthusiasm and shared joy at being able once again to do what we used to take for granted. COVID and its aftershocks have reinforced, for me and everyone at Eddingtons, just how lucky we are to work in the UK housewares industry. We’d like to take this opportunity to wish
everyone else involved a well deserved Christmas break and a Happy New Year. Bring on 2022!
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November/December 2021
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