“We are a retail installer trading for around 15 years, manufacturing around 150-200 frames a month for our own homeowner customers. Sales are going well and we need to invest if we are to increase output and maintain quality. I am questioning if we should just buy in trade frames. Have you ever had to make such a decision?”
– R.B. Midlands
Yes, there have been times when I have questioned the wisdom of manufacturing but that was some time ago. We took the decision not just to invest but also to manufacture our own unique sash to arm ourselves with a unique product to supply to our customers. It worked a treat for us.
However, until I made that decision it was touch and go: we were making a few more frames than you but we needed to spend some money on machinery and it does not come cheap. But whilst we sell our own windows through a local retail operation the bulk are sold to trade customers, many of them about the same size as you. Most of them make decent money.
They receive help with their websites, printed brochures, lead generation and a great deal more. For most of them the margins of making their own frames would not warrant the investment – the continuous investment – in machines and that allows them to concentrate on what they do best – market and sell windows, doors and conservatories!
Well, you would say that, I hear you say… the economics tend to speak for themselves and the fact that you are even asking the question suggests that you are finding things tight. As in any market where margins are slim volume is everything and you simply cannot be making enough money to substantiate employing a workforce (that are a headache in themselves!); maintaining and purchasing machinery; and the sheer agg of worrying about running what are the totally different disciplines of sales, and marketing, and manufacturing.
Buying trade frames at the volumes you require will make you a decent account for a trade fabricator who will want to help you grow your business. There are around 2,500 of us to choose from. I suggest start with the system you want to sell (you didn’t say which one you manufacture – but you may be happy with that so start there); what sort of support do they give? Are you impressed with their website, general approach to business? check their OTIF (On Time In Full) delivery stats; and have a look through the various trade magazines for a few clues too, but make sure you read between the lines.
Simple then: Bite the bullet, get a decent trade fabricator behind you; make loads more money.