The conservatory and double glazing industry has had it hard enough over the past two or three years with the recession, the implementation of new building regulations, seemingly endless price rises in materials and fuel costs, let alone the VAT increase that is scheduled for January 2011.

We’d all like to think that we can absorb increases in costs and simply work on volume with a view to remaining the most competitive, but its not as simple as that.

No company, no matter what industry they are in cannot possibly absorb such a huge increase in costs and sustain the profitability they need in order to survive. No doubt we’ll see some try, and consequently disappear very quickly.

The price of double glazing and conservatories has been driven down over the years by fierce competition that think that in order to win sales, they have to be the cheapest every time. This is simply not true, very few consumers buy on price alone, price is important but not everything. The single biggest factor that makes a consumer decide to buy anything, not just windows and conservatories, but anything, is confidence. No matter how cheap you are or how good you think your product is, if a consumer doesn’t have confidence in you or doesn’t like you, they will not buy from you.

Although there is nothing wrong with being competitive on price, you still have to make a profit in order to protect the future of your company, it is not optional, you just have to.

The double glazing and conservatory industry is just one that has been hit with multiple sharp rises in material costs but in addition to that, the new Part L Building Regulations that came in to force on the 1st October 2010, means a further substantial increase in costs for double glazing installations, mainly due to a higher specification of glass that now has to be fitted, i.e. softcoat, argon filled double glazed units with a warm edge spacer bar which consequently must result in higher prices for consumers. Ironically, this improvement in thermal efficiency actually causes a different problem. See my previous post about condensation on A rated windows.

What about the forthcoming VAT increase and will it make much difference? Well, although the new building regulations don’t apply to a conservatory, the VAT obviously does. You might say that it’s only 2.5%, a couple of hundred pounds on the average conservatory but if its not passed on to the customer, it can cost you a big slice of your profits. We manufacture and supply around 800 DIY conservatories per year at an average order value of about £5000, therefore if we did not pass this on to our customers, a 2.5% increase in VAT means a cost to us of £90 per conservatory – that’s £72,000 per year!

I think that the trend in driving down both double glazing and conservatory prices now has to end and that the end user has to pay more. There is no other alternative which of course won’t help either our industry or the general economy of the country.

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Conservatories are a substantial purchase and now is a good time to order one before the VAT rate increases to 17.5% from January 2010.

It’s only 2.5% you might say but that could mean a saving of £300 on a £12000 complete conservatory build and installation project.

Another advantage of ordering conservatories at this time of year is that you’re much more likely to be able to negotiate a better deal from suppliers as their sales are normally at their lowest levels of the year and they are usually more generous with the discounts with a view to filling up their order books.

There’s another great way of saving lots of money on a conservatory, and that’s with DIY conservatories.

A DIY conservatory can save on average around £3500 compared to purchasing a complete design, building and installation package.

DIY conservatories are not for everyone, but if your prepared to take a little control of the project yourself, the savings are very worthwhile.

It’s not only on conservatories where you can save money either, there are lots of other great deals to be had at this time of the year on conservatory furniture, flooring and blinds.

Many trade and retail sectors, particularly in the home improvements industry suffer from lower sales volumes around the Christmas period so you can use this to your advantage when negotiating prices and of course the same VAT savings will apply if purchased before the end of the year.

Remember, January and February are normally the busiest months of the year for home improvement sales and that’s when prices will be at their highest as suppliers can afford to ‘cherry pick ‘ and demand higher prices for their products, so there’s no time like the present.

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