Early in 2021, as the world was gripped by the Covid pandemic and all that ensued, news hit the resin manufacturing and supply industries that there had been several force majeures throughout the production chain. The result of this was a worldwide shortage of isocyanate… One of the key components in the production of the blend of resin used throughout the resin-bound industry, for the UV stable market.
As news of the scale of this issue spread throughout the resin-bound market, most noticeably in the UK, naturally a level of panic set in. The industry has been increasing in terms of its market size for the last decade, and in particular, the past couple of years have seen an exponential increase in installers and installations. As the product has seen a jump in both the domestic and commercial markets, it has gained a high profile within the construction industry, and deservedly so.
What does this mean for us?
Just as we at SureSet were bracing ourselves for the busy installation season, with the order books already increasing in light of the backlog in some areas due to national and local lockdowns, we began to receive confirmation from our suppliers that there would be tight restrictions on the volumes of isocyanates available to their customers, as well as substantial price increases on the way.
We began to put measures in place, to ensure that we could maintain our supply chain as best as possible and source our material from our already existing number of suppliers who we regularly use throughout Europe and the UK to source our resin. This included placing bulk orders with suppliers, which were then either reduced or staggered as the increase in demand was felt at their level within the supply chain.
As a result of this, we made the decision early on in the situation that we would prioritise our existing customers and take the unfortunate but necessary decision to not take on any new customers until the shortage had eased. This means we were able to continue to install our own installations, supply our network of Approved Installers who already have order books in place for much of the year, and continue to supply our recently increased trade market with the product ProResin. However, even with these restrictions and measures in place, it is still far from plain sailing…
Unfortunately, the nature in which we receive the resin has become relatively unpredictable, as a proportion of it comes from mainland Europe which was also impacted by the Brexit move which was already underway, as well as the continuing pandemic and resultant travel restrictions that were in place. It has become necessary for us to extend the lead times of our product, to enable us to service the requirements of our customers and work within the limitations of our staff numbers particularly as we were still under some form of Covid restrictions involving many workers throughout the UK, not just at SureSet, who are still working from home. A robust system has been put in place within our Warehouse Department, to monitor all incoming materials from our suppliers based on when they actually arrive as opposed to when they were projected to arrive, this requires updates several times a week. Off the back of this, our team are also regularly monitoring outgoing orders to work within a quantity of resin that we have earmarked for each of the important sectors in which we work in. This lead time situation has become relatively flexible and fluid, which means we hope to be able to reduce that lead time on a more reactive basis as and when stock levels improve.
Regrettably, it has also been necessary for us to increase our pricing. This is a direct result of the continuing increase in pricing from our suppliers, we have strived to pass on our increases in a way that was proportionate to the price of the incoming resin and the kits and square metre value of our sale prices, in some circumstances we even took to reduce our profit margins to ensure we are able to work as fairly as possible with our customers. Unlike some suppliers in the marketplace, we have chosen to increase those prices incrementally as we received the incoming price notification from our suppliers as opposed to putting a nominal increase in place at the start of these price fluctuations. The benefit of this, is that we will also be able to reduce our prices in that same incremental manner as and when prices stabilise and fall within the supply chain; we have committed ourselves to do this at the earliest sustainable moment so that we are able to ensure the longevity and quality that our customers require and deserve.
At the moment, we do not know when this situation is going to ease or indeed end, however, we are in constant communication with our suppliers and also others within the marketplace to ensure that we are kept abreast of as much information as possible and will aim to communicate that with our customer base at the earliest opportunity.
Throughout these times, it has been very challenging not only for our workforce that is directly employed at SureSet, but also our transport services, UK & Global Partners, and our customers. We would like to take this opportunity to thank each and every one of you who has supported SureSet throughout this difficult period of time because without you we would not be in a position to work so confidently and reactively with you in a consultative manner that we aim to do.