Supply Chain Update July 2021

Supply Chain Update GJB & Listers

 

Things show no sign of letting up on our sales order intake, in fact many customers are ordering twice as much compared to 2019 which is great, however we do have finite and stretched capacity which is constantly challenged. We also understand the frustrations with regard to our current lead-times and service levels and continue to work with you where possible to accommodate urgent requests. We are also working very closely with all of our suppliers who are experiencing similar issues.

 

We are hearing from many of you that things are showing signs of cooling down at the front end and I think we would all welcome that for sure. I know that the large national brands are seeing lower levels of enquiries since the lockdown restrictions were partially lifted.

 

I really want to update you on our short term and longer-term plans to deal with our supply chain, capacity and explain how we plan to reduce our lead-times, please take 5 minutes to read and digest:

 

  1. Key People Retention

 

  1. We employ over 350 people and a combination of working through COVID, the pressure of unrelenting volume plus the competitive landscape for jobs with Amazon, DPD and major supermarkets all offering more and more cash to recruit (throw in the odd competitor who love pinch rather than train and develop). This has been really challenging for our shopfloor management and our employee retention particularly on the shopfloor and Class 1 Drivers. Clearly, we must retain our most valuable employees and to that end we have recently reviewed all of the pay grades.
  2. We want our best people and best fabricators to work more hours and earn more whilst the volume is here and that’s much better for customers rather than the alternative of mass recruitment and all the quality challenges that brings! So, to incentivise the team we increased overtime premiums and also added a one-off quarterly bonus at both factories.
  3. We have set targets to the year end for output, cost of quality and OTIF (on time in full) and introduced a “One Team One Bonus” scheme. Every employee can now see a way of earning a nice bonus just before Christmas.
  4. The net effect of all of the above will be that the average employee in our group can earn significantly more than they did in 2019. Clearly, we are mindful that we don’t want to create an inflationary issue for the future and hence most of the incentives are driven to make hay whilst the sun shines and communicated internally as such.

 

I know that many of our customers are experiencing similar problems with staff and installer recruitment and retention, so hopefully sharing this may help you people are certainly more important than ever before to our businesses and finding the right balance can be very tricky.

 

 

  1. Increasing Capacity

 

  1. We have recently invested a further £500k and installed brand new welding and corner cleaning equipment in Stoke which will increase our capacity by 30%, we are also completing a layout review which will result in another 10% so Stoke will be capable of fabricating 1,300 PVC frames a week (it was 700 when we acquired the business in September 2017).
  2. We are now working nightshifts in Essex and Stoke and are carefully increasing the numbers on the shifts but mindful of quality control. We believe that we can find another 10-15% with a full nightshift by September.
  3. We have recruited and trained a significantly better processing team in Stoke and developed similar processors now to those that have been so effective in Essex. The 2 factories are working much closer now than at any time.

 

 

Composite Doors

 

I think most of you are aware of the issues that continue with Composite Doors in the industry. Our main supplier Doorco have navigated through the issues well up until this last month whereby they have had issues with supply of cassettes. They’ve taken steps to fix the issue and believe they will be back to normal service by August however we do continue to have ‘lumpy’ service for the time being.

 

May I take this opportunity to thank you for your valued business and also your patience, hopefully we are at the peak of the raw materials turbulence and better times are ahead.

 

 

Roy Frost

Group MD

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