EMERGENCY SURCHARGES

Towards the back end of 2020 and all the way through 2021, the cost of global shipping costs went through the roof. Whether it was from China to Europe, the US to Europe or China to the US, container costs spiralled out of control.

The lifting of COVID restrictions around the world released consumer spending like a dam that had been 1filling up for months. As a result, demand for pretty much everything went nuts. Including demand for home improvement products like windows and doors.

As a result, suppliers in our sector, generally in the world of doors and hardware, began to put in temporary shipping surcharges to cover the additional costs of getting products to this country. For context, suppliers agree on prices weeks and months in advance on shipping. But in this particular circumstance, with demand out of control and only so many ships in the world to get things from A to B, that went out of the window.

However, we were told by various suppliers that these surcharges would be temporary and that they would be reversed as and when things settled. Well, as you can see via the chart below, prices have very much settled back near where they were before the pandemic. So will the fenestration sector begin to see these surcharges fade away?

Will surcharges be dropped?

The context, which I laid out above, is important to remember. Transport conditions were uncontrolled and the world was experiencing something it had not encountered before. Due to this, there was a lot of goodwill and patience within our supply chain towards suppliers. That’s not to say there were some vocal opinions on these surcharges to cover the extra shipping rates, but I would say in general our industry accepted what was happening and got on with the job at hand.