Integrated supply chain – where does the contractor sit?

Published on 11th November 2016
Supply Chain

So a few months after the Brexit vote, the UK economy continues to defy the naysayers within the Westminster/City bubbles. Whilst the devaluation of sterling will ultimately bring inflationary pressures to bear, Mr and Mrs Average Briton quietly go about their business as usual, with no discernable deterioration in consumer spend, which includes larger ticket items such as motor cars and even new houses.

The UK Government whilst saying little publicly about its intentions ahead of the Autumn Statement, and more tellingly the Brexit negotiation stance, have been widely trailing the intention to prime the UK economy through a Keynesian approach that will include accelerated investment in the UK infrastructure – including housing.

Indeed in the new housing arena, we are starting to hear suggestions of some different approaches: some, such as the encouragement of modern methods of construction are not new, but to see some tangible evidence of a government policy that actively encourages this type of solution is to be welcomed. Other more recent suggestions that we are to embark on a strategy to replicate the post-war ‘pre-fabricated home building’ are particularly interesting partially because it suggests a scheme of some scale but also to hear how government anticipates building the supply chain that delivers any such ambitions.

As one of the many trades that make up the delivery element of any house building supply chain, Roofing Contractors have a key role to play. We have exercised the arguments and routes to new recruitment and training many times in this column and elsewhere over the last years, so it is not the intention to rehearse them again. Instead, I would like to explore what the role of the Contractor should or could be in an integrated supply chain.

As the ‘jam in the sandwich’ between manufacturer and developer we are the first to have to cope with issues such as supply shortage, although we are often the last to find out about any such issues – surely we can play a positive role in managing this kind of issue; if we are part of the conversation we can be part of the solution.

Similarly, organisations throughout the supply chain are looking creatively at security of supply and also ways in which they can align production resources. At face value this approach should be welcomed – but again, if this brings about conflict and disruption to the supply chain, and looks to fragment the way in which the industry operates but strips resource rather than increasing it then the long term impact will be disruptive rather than positive.

The existing supply chain of manufacturer, contractor and client has worked well and served the industry well over may decades, and has failed to deliver only where industry and government have in the past taken a short term view and allowed house building programmes to suffer on the winds of uncertain economic conditions.

I would contend that this is not because of the way the supply chain operates, but that it has had to self regulate itself with the loss and abandonment of a massive skills base that cannot be quickly or easily replaced.

The existing route to market works best where an integrated approach is developed between all parties, sharing medium term plans, working closely to accommodate new regulations and working standards and sharing expectations so that all parties can deliver and prosper together, In short an interdependent existence.

So whilst new innovation will always be welcomed, we should not look to make change for changes sake, but instead continue to invest in greater numbers and increased skills across all areas of the supply chain – nowhere more so that in the contracting sector where companies large and small provide the manpower to actually deliver the build programmes for new housing,

The call to all other parts of the chain is to work with us, not against us. Keep us informed of material supply issues so that we can help manage the process with clients, and if, as looks likely there will be inflationary pressures that come into the supply chain – accept those that are legitimate rather than squeeze the contractor who sits in between manufacturer and client, where the unfortunate consequence of such an approach is likely to be a reduced rather than increased contractor base to meet future demand.