Volume 8, Issue 8 - September 2007
from the publisher
Glass Purchases: Split Decisions
We all know that the days of using a handshake to seal a deal and a commitment to use one company as a supplier have gone away. These have been replaced by a multitude of companies competing for your business. Whether it’s at an industry meeting, or over the Internet, window manufacturers have a variety of suppliers offering them the “best product to put into their windows.”
At the end of 2006, DWM magazine polled door and window manufacturers on their views regarding a variety of suppliers: hardware, screens, machinery and glass. The latter is being featured in this issue, while hardware was reported in June and screens in March (machinery will be highlighted in December). The results were insightful when it came to the topic of how many glass suppliers a company uses. To sum it up, manufacturers rely on a variety of suppliers to meet their needs. Our respondents use at least two, and in one case up to eight, different companies. Yes, the days of consumer loyalty have, for the most part, been replaced by a revolving loyalty to the company with the lowest price or the biggest product variety. Our survey also found that quality and price, along with lead times, reign supreme.
One reader said, “A change in suppliers is driven most often by [another] supplier’s failure to service our company or maintain competitive pricing.”
Taking the responses into consideration, let’s look at the overseas situation to draw some conclusions. Looking at the results and how important lead times are your first instinct would be to say, “Goods from Asia wouldn’t be a threat] due to lead times.” But given the fact that companies use several suppliers, what’s to stop them from relying on U.S. suppliers for some glass and overseas suppliers, for “stock sizes” where lead times aren’t an issue?
In fact, one of our respondents said he uses three glass suppliers, one from a company from China that he has worked for ten years. I can’t be sure, but I’d bet that most of the glass he gets from the Chinese company aren’t ones that he needs right away.
And price plays into this equation as well. Many manufacturers told us it comes down to price, so why not get a cheaper product elsewhere, whether that is in the United States or abroad?
As always, there is a flip side and I wouldn’t be a good editor if I didn’t present both views. When one window manufacturer was asked what he would change about glass suppliers he said, “… get the supply of glass closer to our manufacturing facility so we can stock less inventory.” So I’m guessing that company isn’t going to order a lot of glass from abroad to keep on hand in the warehouse, even if it’s cheaper.
But even if the future sees a split between company A and company B, that still means less business for U.S. glass suppliers and an increasingly competitive market. But, the bottom line is good news for window manufacturers: suppliers in any category will be more focused than ever on offering quality products when you need them. The market is simply forcing them to do so.