Glass and Glazing: Kidderminster

The glass and glazing sector continues to struggle as a result of the damaging impacts of the economic downturn, as evidenced by the appointment of SFP as administrators to no fewer than three glass and glazing firms in the last few months. The sector’s financial problems are severe, despite the four million tonnes of glass produced by the UK glass industry every year – glass that is used to make food and drink containers and automotive parts.

It is glass that goes to make glazing for construction, however, that is the biggest issue – especially since construction is itself suffering from the effects of recession. With the economic downturn has come a collapse in investment in building projects, which the glass and glazing sector depends on. The number of new housing builds is down by 13.2 percent per annum, its lowest level for many years. The insolvency of construction firms has dragged glass and glazing firms down with them.

It is no wonder that with 120 construction companies going under in the second quarter of 2012 in London alone, that SFP has been busy. Daniel Plant, Group Partner at SFP, believes that difficulties being experienced in the construction sector have had a direct impact on recent failures within the supply chain: “The downturn in the economy has caused a knock on effect and especially in the installation of new windows, as we have found with our administrations of the three firms. Moreover, many other ancillary sectors have been affected by the slow down in construction projects including tiling, floor preparation and ground works.”

It seems that no business is totally safe, as insolvencies in the glass and glazing sector even encompass a company involved with the London Olympics. Parry Bowen, a building cladding specialist that had a contract for the design and construction process of the curtain walling and glazing at the Olympic Village, went into administration in October 2011 saying, ‘the dreadful state of the construction market over the last couple of years has unfortunately seen these reserves disappear as reduced margins and customers’ reluctance to pay have taken their toll.’ Other reasons for the sector’s difficulties include the high cost of production, as fuel is needed to power the high temperature furnaces.

Southampton-based Express Glass & Glazing is yet another firm to have been appointed to SFP, in spite of its contracts with a number of housing companies.

5 Star Windows and Conservatories Limited – which specialises in designing and installing UPVC conservatories, glass extensions and double glazing windows – is the most recent example. SFP’s Daniel and Simon Plant, both licensed members of the Insolvency Practitioners’ Association, were appointed Joint Administrators on July 24th 2012: “It was unfortunate that 5 Star Windows and Conservatories Limited struggled due to a lack of cash flow at a critical time,” Daniel says.

Thanks to insolvency practitioners like SFP, firms like 5 Star Windows and Conservatories sometimes have a future. Daniel Plant says that in the case of this firm: “We managed to secure a sale of the business as a going concern, ensuring the preservation of jobs and continuity of supply for its customer base.”

There is some hope on the horizon for other firms struggling to complete. Areas such as public non-housing projects are not feeling the effects of economic downturn as much as others. Yet given the scale of the public sector deficit, it is likely to be a long slow road to recovery for the building and construction industry, with the glass and glazing sector following behind.