Please see below the latest update in respect of Smoke alarms.
We continue to meet with each of the Framework suppliers on a weekly basis, so be advised that the situation as outlined below continues to be fluid;
- FireAngel’s expected delivery of 4000 for last week was reduced to 1800. The allocation of these alarms was split between the 11 FRS that reported less than 4 weeks stock on the data portal.
- The next delivery of 15,000 arrived at FireAngel on the 6th December and will be followed by 10,000 w/c 22nd December and 20,000 early January.
- The latest data portal returns show that 14 FRS hold less than 4 weeks of stock and yet very few FRS’s have raised any supplementary orders with either of the other suppliers on the Framework. Whilst the proposed volume of deliveries from FireAngel for the remainder of the year is encouraging we are still not in a position to guarantee that this will continue. As such we wanted to urge all FRS’s to ensure that they have assessed this risk and considered what action may need to be taken to ensure that they do not run out of alarms.
- Please confirm by return e-mail whether deliveries can be accepted during the Christmas holidays (excluding Bank Holidays). Unless we are informed otherwise we will assume that we can continue to allocate alarms for delivery in the normal way during this time.
- Only 2 FRS placed orders with FireBlitz following their offer to airfreight some of their consignment in December.
- AICO supplies remain stable and are able to continue to manufacture and deliver smoke alarms within circa 1 week.
- IMPORTANT NOTE: Adhesive pads are not supplied with the AICO alarms as the preference is for them to be screwed into the ceiling. The appropriate screw fixings are therefore supplied instead. We appreciate that each FRS will undertake their own risk assessment when deciding on the appropriate way to affix each smoke alarm taking into account the likely variety of sub-structures that may be encountered, e.g. concrete, plasterboard, artex, plaster lathe, asbestos and timber.
Hearing Impaired Alarms
- FireAngel and Fireblitz are now experiencing supply chain issues with Hearing Impaired (HI) alarms due to the global shortage of chips. The scarce supplies that are available are also being sold at significantly inflated prices which we are told could add circa £4 to the price of an alarm.
- FireAngel received a delivery last week of 250 WST630 HI alarms and do not have any information on further deliveries at this time.
- Four FRS that have a high volume of stock have agreed to mutual aid HI alarms to other FRS with low levels of stock.
- Fireblitz can only honour orders for existing FRS customers and are unable to obtain any more chips at the current time. They will keep us informed of when this situation starts to improve and/or if they can secure any surplus stock.
- In the event that we cannot meet the demands of the Sector for HI alarms using the limited supplies from FireAngel and Fireblitz or via mutual aid, FRS are reminded that AICO can supply HI alarms but at a cost of £33.50 per alarm. FRS are also recommended to take advantage of FOC training offered when ordering hearing impaired alarms from an alternative supplier as the installation is very different to that of standard smoke alarms.
- Thanks to all FRS’s that have provided or have offered to mutual aid standard smoke and hearing impaired alarms. It is much appreciated and supplements the work being done via the National Hub to support supplies of standard and HI alarms. Some offers are being managed locally at the present time within Regions but FRS are reminded that FireAngel have offered to support the transportation of alarms FOC between FRS as required.
- Please continue to direct any offers of mutual aid to Mandy Beasley or myself and we will arrange for FireAngel to collect the alarms.
- It is highly likely that we will face the inevitable impact of global shortages and freight charges on the price per unit during this turbulent period. Both FireAngel and Fireblitz are considering a price increase across their whole range of products available via the Framework. Understandably the suppliers are now unable to continue to absorb all of these costs and have reluctantly turned to our Sector for support.
- In the next few weeks we will be discussing a price increase with all of the suppliers on the Framework and seeking the necessary evidence in support of this. As you are aware the Framework pricing was fixed for the duration of the Framework period but we believe that we are experiencing unforeseeable global events that require us to take a commercial decision to work with our suppliers or risk potentially risk losing them.
- Any price adjustments will be temporary in nature and subject to regular review so that in the event that the current supply chain issues ease we would hope to see that prices will also reduce again as a consequence.
- Revised pricing will be communicated to the Sector as soon as it is agreed and may apply to some back orders from FireAngel that have not yet been fulfilled.
Reimbursement of additional costs from Suppliers
- In previous communications it was indicated that we have the ability within the terms of the Framework to claim back any additional costs in the event of a breach of contract. Despite us having the legal option to do this the National Procurement Hub has consulted with both legal advisers and financial consultants (BDO) to determine if we should exercise this right and what the implications of doing this could be for the Sector.
- Many suppliers post Covid had begun to show signs of financial distress and this was evident from information that was readily available in the public domain. The National Procurement Hub appointed the services of BDO to help us understand the true extent of FireAngel’s financial position so that the question of whether or not to seek reimbursement of additional costs could be assessed from a commercial perspective.
- FireAngel have been extremely co-operative in assisting with this review, the outcome of which shows that FireAngel are a company in “turnaround” and whilst this is encouraging it also denotes that they still have some financially vulnerability. As a Hub we have therefore taken the decision not to seek financial reimbursement from FireAngel via the Framework for the following reasons:-
Ø As stated above FireAngel are still in a delicate position financially and although they have secured additional funding from HSBC and shareholders they will have made a loss this financial year, due to post Covid supply chain issues. Albeit to a lesser amount than last 2020. If we were to seek further financial reimbursement from them at this time it could either increase the likelihood of them going into insolvency or they may have a greater financial need to refuse to supply the Sector completely in favour of their more profitable customers.
Ø The three suppliers on the Smoke alarms Framework are the main suppliers in a relatively small market. Given that the majority of UK FRS purchase smoke alarms from FireAngel the impact of them going out of business would have a significant impact on our Sector.
Ø The issues being faced by FireAngel (and the other suppliers on the Framework) are unprecedented and global in nature. If we were to take this matter to court (notwithstanding the complexities and costs of doing this) then the likelihood is that this could be classed as a “force majeure” event and the courts would find in favour of the supplier.
Ø FireAngel have continued to work with the Sector over the last 4+ months (via the Hub) to maintain a supply of alarms both now and into the future. Whilst the quantities supplied are vastly reduced compared to “normal” levels we are managing to maintain minimum 4 week stock levels across most FRS. Again I think in the eyes of the court this would show their willingness to support the Sector at a time when global issues are working against them.
Ø We appreciate that the above decision and the likelihood of future price increases may cause concern, however, we are sure you are aware that we are experiencing this issue across a number of our supply chains at the current time. We believe that our best option is to continue to manage this situation in a collaborative way via the Hub to limit the commercial impact on our Sector and to also support the continued existence of our critical/strategic suppliers.
Data Portal and Forecasting data
- Data portal returns should include all stock on stations as well as held centrally. A few recent returns have omitted to include station stock or recent deliveries which has led to providing Suppliers with inaccurate information.
- It is imperative a return is entered on the data portal on the 7th and 14th December to ensure alarms received by FireAngel in December are allocated to FRS’s with the least amount of stock. There will then be a break over the Christmas period and returns will be required again on the 4th January 2022.
On behalf of the National Procurement Hub we would like to thank all FRS for their continued support and co-operation with these issues and to you wish you all a very Merry Christmas and a Happy New Year.