Insight

A review and preview of the global fastener market

Named after the Roman god who is often depicted as having two faces – due to its ability to look to the future and to the past – the Janus Perspective is a unique feature that includes a wide cross section of global fastener business leaders, who have all contributed their retrospective of 2021 and thoughts on prospects and challenges for 2022.

Ramón Ceravalls, chief executive officer

I always evaluate the performance of our business in two parts, firstly the performance of the current year and secondly the work we have done to improve our business for future years.

After a difficult 2020, with sales slightly decreasing (-2%), 2021 will be a very good year with sales growth at around 20% and good economic results. At the beginning of the year, we were already expecting a good performance as we had very good new projects for customers in our Industry division (mostly automotive, with technical screws for plastics and thread rolling screws for metals). We had also managed to keep growing our Construction division in the electrical, plumbing and hardware markets – thanks to the continued good momentum in our range of direct impact fixings, support systems, fixings on isolation materials and frame fixings.

The supply chain has been a common problem in many countries and sectors during 2021. We have also suffered a lot, but overall, our customers say that we have done better than the market. For once, having our own factories and very good and reliable (even personally close) supplier base has been a competitive advantage. Raw material price increases have been negotiated with suppliers (of course) but we have been sensible to the cost increases of our suppliers and we have prioritised the service over price discussions and speculating.

The Covid-19 pandemic has been a major problem, especially at the beginning of the year and towards the end of the year. As a small company, we have done our very best to secure the wellbeing of our employees, in the company and at their homes. The situation forced us to change some internal processes and we had time to focus on mid-term projects for logistics, the factory, our sales team, as well as  administration, to improve our sharing knowledge among our local and international teams (a kind of CELO Wikipedia). Plus, we have looked at processes and added new machines to improve efficiency.

Throughout 2021 our team continued to improve both its talent and knowledge. We also continued to invest in new machines for cold forming, plastic injection, metal rolling and automatic assemblies. We have not stopped in our product development and we have some very nice new products that will be launched in 2022.

As for 2022, every year there are new challenges and opportunities… and as always, we will adapt. Whilst there is a lot of short-term noise, we will keep focussed on our long-term objectives. The advantage of being a small family company is that we are ready to accept some bad times as long as the long-term is good.

I believe that our main challenge in 2022 will be the volatility of costs, which have been ramping up since Q4 2021. We need to pass these costs to our selling prices. However, I expect that bottlenecks will be solved sometime in the second half of 2022 and this might lead to some costs reducing. Our plan is to minimise the price volatility to our customers by cutting the high price peaks and hoping that costs will reduce to a more normal level.

Another main challenge is the volatility of demand. Our factories and our supply chain cannot be adapted every three months. We have planned our operations for 2022/2023 to be capable to face a significant increase in demand. But demand may change very fast as is happening now with the automotive sector. We have kept our structure because we expect the situation will change in the second half of 2022 and then we must be capable to react fast to serve our customers.

Other important factors for 2022 will be related to the climate emergency and digital transformation. To solve the climate emergency will require investments for energy savings in buildings and transition from coal/fuel/gas to more sustainable energies such as solar, wind and maybe even nuclear. Cars will change to electric, and I expect that hydrogen will also have a part to play in the future. These changes will have a major impact on fastener businesses.

At CELO, like many other fastener companies (but not all), we have been preparing ourselves to take advantage of these new scenarios. We will continue in the same direction in the future. We want to be a leader in technical screws and technical fixings that reduce installation times and costs. That is why our main focus will continue to be to keep building a top team with the latest talent and knowledge; carry on product innovation when it comes to screws and fixings that reduce installation times; as well as focus on our digital transformation and how we can reach/service our customers, as well as improve our internal processes. Finally, we will look for international expansion to access new markets.