Sales & customer service 0161 406 0055

Race to the bottom – how to avoid devaluing your fenestration business

In the midst of escalating expenses and decreased consumer spend, it would be unwise to rely on constant undercutting and margin reductions as a means to secure business. Dekko Sales Director Kurt Greatrex discusses why we need to avoid a ‘race to the bottom’…

Dekko Kurt Greatrex

‘Race to the bottom’ – it’s a phrase we’ve been hearing increasingly over the past few years in the context of everything from post-Brexit trading to responses to the refugee crisis. Many aspects of our economics, and therefore our lives, seem to be hurtling southwards as the big existential crises – war, climate change, hunger, poverty – impact on our thinking.

Last autumn, a decision by the then Chancellor Kwasi Kwarteng to cut corporation tax in order to boost growth was deemed as a race to the bottom. Experts warned that tax cuts were no magic bullets to increase growth – but Kwarteng went ahead anyway, spooked the markets, and Liz Truss’s short spell as Prime Minister ended in disaster.

The fenestration industry has seen similar price-slides, with manufacturers and installers jostling to offer ever-attractive cuts and gain market share, to the point that businesses are prepared to sustain losses in the hope that when better times return, customers will stick with them – and accept the inevitable price rises.

Too good to be true?

But it doesn’t take a financial genius to work out that customers aren’t always so predictable. Everyone likes a bargain, but we tend to know that price-cutting has its consequences. ‘Buy cheap, buy twice’ is an old adage that we all understand. And if something sounds too good to be true – like a bargain price – then it usually is.

There is much more to a successful business than its ability to simply cut prices. Yes, such an action may draw customers in the short-term, but when they start to see compromises on quality, resulting in substandard goods, job losses, cuts to other areas of the business and a subsequent decline in reputation, they often vote with their feet.

So how does our industry remain competitive without resorting to the race to the bottom? At Dekko, we believe that innovation is the way to our customers’ hearts. If you offer them something they can’t refuse, or obtain elsewhere, you’re in pole position to make a sale. And in our industry, it’s good design that’s stylish, durable and innovative, which will persuade customers to invest, even ahead of price considerations.

How else might we avoid the ‘pile it high, sell it cheap’ mentality?

Establish a solid pricing plan

How do you decide what your price should be? First, it’s important to understand the value of what you sell. The emphasis on value is often missed as business owners rush to be price-competitive. Customers are quite rightly suspicious of knock-down prices, believing that what they buy will be of poor quality. They may or may not be right – nevertheless, the perception remains. Establishing value means making your product a must-have – it needn’t be unique, but it must have enough allure to make it valuable for the customer.

Costs, turnover and profit

Every business, large or small, has overheads to consider, whether it be raw materials, labour, property, electricity, etc. You need to factor all these in before you decide on your price, and therefore your margin. Once you know your costs you can easily create sales and revenue targets that will help your business to grow.

Knowing your market

This requires you to be a bit of a trend-spotter. One day your product might be in vogue, then the following day it isn’t and you need to know why. It could be seasonal, it could be geographical, it could be shifting tastes. Whatever it is, it’s vital to understand shifts in your market and alter your price accordingly.

Understanding your competitors’ strategy

This is a tricky one. If you’re selling at a price that is higher than your competitors, it’s almost inevitable that your customers will ask questions. If and when they do, you need to be able to point to other factors such as better quality, more effective customer service, a new feature – something that will elevate your product and justify the price increase. A business will be able to justify a price increase and survive any negative perceptions of a price drop if the brand is strong, reliable and innovative.

These are just a few ways of getting to grips with product pricing without becoming involved in a dangerous race to the bottom. At Dekko, we pride ourselves on constant product development, honing our offerings to match ever-changing consumer trends and advances in technology. This, we believe, keeps our customers loyal, especially in uncertain times.

How can Dekko help you?

Dekko is a leading supplier of high-quality uPVC and aluminium windows and doors, serving to the trade. For more information on our products and services, give us a call today on 0161 406 0055 or contact us online.


Fast delivery and would highly recommend

"Ordered double glazed window for our shop. Dealt with Nathan on the Trade Counter, who was excellent and went above and beyond the usual customer service. Window was very well made and arrived with no problems. Fast delivery and would highly recommend."

Tony Spooner

The windows look fantastic

"Recently used Dekko Windows to supply the windows and aluminium bi-fold doors for our renovation project. We paid a short visit to their showroom where Rob and Neil were really helpful, showing us around and providing options for us. We were really happy with the whole process and the windows look fantastic. Would definitely recommend this company."

Richard Kennedy

Very happy with the level of service and products

"I've been using Dekko Windows for a number of years now and have been very happy with the level of service and products. Rob and Neil have never failed to get back to me promptly with quotes and lead times etc and Leon the delivery guy is always happy, friendly and helpful whenever unloading frames on site."

Peter Bain

Excellent service

"Excellent service. It's always a joy to deal with Rob, Neil and Leon. They always go out of their way to assist me with my projects and are very professional and friendly. Thanks again to the Swindon Dekko Team!"

Jordan King

Scale Up
Finalist award logo
Scale Up Awards 2020 Finalist
Infinity logo
Make it yours logo
Deceuninck logo
Residence collection

Nationwide delivery in the UK

From our state-of-the-art factory in Lancashire, our products are transported to installers across the UK. We strive to meet all delivery deadlines to ensure our customers are never delayed. They stock an extensive range of PVCu and ancillary products to give installers easy and convenient access to all the necessary hardware.

Contact Us