The BWF CERTIFIRE Fire Door & Doorset Scheme Quarterly Trends Report

Sales Strengthen for Fire Door Manufacturers

"My impression of the first half of this year is that the construction market overall has not been as difficult as everyone expected at the turn of the year, and this quarter's survey of the fire door market seems to confirm this", comments Richard Lambert, Chief Executive of the British Woodworking Federation. Although the situation may not be as buoyant as it was a year ago, fire door manufacturers don't see any cause for alarm, and there is a general sense of things improving as the year goes on.

"The major source of concern is the increase in supplier prices, especially in energy prices. Joinery manufacture does not compare with some other construction products sectors as an energy intensive industry, but few can absorb the price hikes coming through without experiencing real pressures on their margins. Given that some of the larger manufacturers who distribute through the major builders' merchant chains already face pressure on their selling prices, only increasing sales volumes will protect profits.

"A rising market will always attract new entrants who see the potential opportunity and want to exploit it. This risk is that their focus is on entrepreneurship, on breaking into the market, rather than on providing and ensuring their products meet quality standards. The BWF has led the drive towards establishing independent, third-party certification as an essential criterion in specifying fire doors. We need to ensure that any one who looks to enter this market knows that there is no way in if they cannot prove their products meet the standard."

The latest timber fire door survey assesses the timber fire door market in terms of the percentage of manufacturers experiencing a particular business trend (e.g. a sales rise) over those experiencing the opposite, expressed as a net balance. On this basis, a balance of 16% of manufacturers sold more timber fire doors in January to March 2006 compared with October to December 2005 (chart 1).

Year-on-year more manufacturers reported growth with a balance of 40% increasing sales in January to March 2006 compared with the same period last year (chart 1). Of those who sold more, 58% saw a rise of 10% or more over the period, a significant rise.

Timber fire door orders were also up. A balance of 26% of manufacturers reported higher order books than three months ago.

---

"There has been a steady increase in demand for 30 minute timber fire rated doors in an aim to meet new government legislation. Fire upgrade and refurbishment contracts specifying fire doors to comply with health and safety regulations have also influenced growth.

"At present we make approximately 750 fire doors a month. We estimate at least a 5% increase this year on last. The future trend looks good due to the surge in quality commercial work"

Mr Ian Kirkwood, Sales Manager
Graefe Limited, Thame

---

Looking ahead, expectations for growth are good with a balance of 40% of manufacturers expecting to sell more in April to June 2006 compared with the previous three months (chart 2). A net 55% of manufacturers also forecast better sales in April to June 2006 compared with the same three months of 2005 (chart 2). Few firms expect sales to fall.

Strong sales expectations are based on manufacturers' positive views about market prospects. A net 30% are more optimistic now about the overall prospects for the timber fire door market than three months ago (chart 3).

Orders for timber fire doors were also up compared with three months ago with a balance of 26% reporting a rise (chart 4).

---

"Changes in government legislation in both commercial and private sectors for the prevention and isolation of fires are responsible for the marked increase in demand for timber fire doors.

"One aspect that building regulations have enforced, is the necessity to isolate fires at source by insisting that at least a 30 minute fire rated door is installed in up to 90% of doorways in hospitals, schools and offices. This has resulted in our company experiencing the best year ever for sales of timber fire doors, up more than 10% in the first quarter of 2006 compared with the same time last year."

Mr Darren Whiting, Branch Manager
Piper Cox Joinery Ltd., Kent

---

On balance one in two timber fire door manufacturers were affected by rising material costs compared with three months ago (chart 5), with none of those interviewed reporting a drop. But only a net 25% of manufacturers increased their selling prices over this period to counter rising costs (chart 5).

Overall, 50% of manufacturers are working at capacity (chart 6). But specifically for timber fire doors, 40% reported working at capacity (chart 7).

The main problems manufacturers faced in January to March 2006 were price cutting in the market and margin squeeze (65%), supplier price rises (55%) and lack of skilled staff (55%). However, when asked what was the single biggest problem for them, supplier price rises and low sales volume tied in first place, both mentioned by 20% of manufacturers (chart 8).

Ninety per cent of timber fire doors sold over the last twelve months through manufacturers were internal doors. Ten per cent were external doors.

Timber fire doors sold in last 12 months	Manufacturers' % of fire doors sales
	Internal	External
By type of Fire Door:
Flush doors	71%	76%
Panel doors	11%	9%
Die formed doors	8%	1%
Laminated timber cored flush doors	10%	14%
Other	0%	0%
Total	100%	100%
All Timber Fire Doors	90%	10%

Forty-six percent of timber fire doors sold over the last 12 months were fire door sets. The majority of manufacturers (80%) continue to sell fire door frames with 60% supplying additional components e.g. fittings for fire doors. Most manufacturers (75%) advise customers which components are required for fire doors.

Merchant Sales & Confidence

A net 21% of merchants sold more timber fire doors in January to March 2006 compared with October to December 2005. Of those reporting a rise, 71% saw increases of 10% or more. A balance of 9% of merchants also sold more timber fire doors in January to March 2006 compared with the same period of 2005.

Expectations are strong for the next three months. A net 53% expect to sell more timber fire doors in April to June 2006 compared with January to March 2006. Confidence levels are also good. A balance of 22% of merchants are more optimistic now about the overall prospects for the timber fire door market than three months ago.

The Timber Fire Doors Survey, a quarterly trends report, is produced by Michael Rigby Associates, and sponsored by the BWF-CERTIFIRE Fire Door and Doorset Scheme in conjunction with Timber Trades Journal. The aim is to keep a finger on the timber fire doors' market pulse, and to view merchants' and manufacturers' expectations of market movements. The survey covers a representative sample of timber fire door manufacturers as well as 100 timber and builders' merchants. Telephone interviews took place between the 3rd - 11th April 2006 across a balanced spread of size of firm and geographical area. Numbers employed was used as an indication of company size. For survey details call Lucia Di Stazio on 01453 521621. © Copyright BWF and Michael Rigby Associates 2006