I’ve had two emails from kitchen suppliers in China during this past week. One from an exotically named ‘Lolita’ and the other, I kid you not, from a ‘Bruce Lee’!
Lolita’s email stated ‘We are specializing in manufacturing kitchen cabinet, wardrobe & bathroom cabinet in China, with good quality and competitive price’ before asking ‘Please contact us freely as a good friend if you are interested in our products.’
Notwithstanding that the writer’s English is way better than my Mandarin, normally such emails are immediately deleted. But these got me thinking a bit more about our sourcing policy and, more specifically, whether we should be looking outside the UK for key components such as our cabinetry if the cost was beneficial and would allow us to offer kitchens to our customers at a lower price.
I should say from the outset that we’re extremely proud to source as many of our components from UK manufacturers, wholesalers and local suppliers as possible. As our blog being truly local explains we’re great believers in sourcing as many of our products and services as possible from local suppliers which helps support the local economy and keeps companies alive and employees in jobs.
But with the headline inflation rate having been 3% or more every month since the beginning of 2010 (source: this is money) many of our suppliers are now being forced to raise their prices. Indeed, one of our key raw materials, melamine faced chipboard, has risen twice already this year with another increase due next month.
Which, in a market that’s seen many kitchen retailers fail this year (Demise of Moben) due to poor sales because of low consumer demand and confidence levels, falling wages, increasing taxes, a sluggish housing market and consumers’ understandable priority of paying down debt rather than investing in big ticket items, isn’t great news!
So looking for cheaper raw materials has to be on the agenda – which is why the emails from China struck a chord.
But then we started to think about the complications involved in importing any of our key components from the cheapest source possible: the quality and availability of stock, the length of time it would take to arrive, minimum order quantities, exchange rate fluctuations and customs duties to name but a few.
But, most of important of all was the potential impact on our brand. The Nicholas Hythe brand relies on delivering a quality product that’s made to measure to individual customers’ requirements. Imagine trying to source a panel damaged in transit and being told we’d have to wait 8-10 weeks for it to arrive. I’m not sure our customers would think too highly of us if that were the case and, given much of our work is based on recommendation, I doubt many would be too happy to do so. And with the advent of social media such as Facebook and Twitter, it wouldn’t take too many disgruntled customers airing their views about us to see that the policy would be false economy.
And, as I stated in my blog invisible cogs, we have some superb suppliers that are an important element in our meeting our customer promises. So we won’t be taking up ‘Lolita’s’ offer to ‘contact her freely as a good friend’. But it’s been a good exercise to think about how and where we source our goods in an economy that’s doing no kitchen retailer any favours!
For hundreds of pictures of kitchens we’ve installed for delighted clients please go to www.facebook.com/NicholasHytheKitchenDesignStudio