Economy, Business And Markets

Window of Opportunity in UPVC Systems

Window of Opportunity in UPVC SystemsWindow of Opportunity in UPVC Systems

Innovations in the window and door sectors have resulted in a surge towards the use of UPVC (unplasticized polyvinyl chloride) in the construction industry, which is rapidly replacing the traditional wood and aluminum systems due mostly to UPVC’s high thermal insulation properties.

UPVC window frames became popular since the late 20th century, particularly in Europe. They found their way to Iran’s construction sector about 15 years ago and are currently used in many residential and other buildings.

In addition to high thermal insulation, UPVC door and window systems demonstrate good performance in terms of strength, durability, sound insulation and security.

The Persian newspaper Forsat-e Emruz has investigated market opportunities and potential for investment in manufacturing UPVC door and window systems.

Ten major UPVC door and window manufacturing companies are currently active in Iran, according to Reza Paymard, a stakeholder in a UPVC company located in the north of Iran. He believes the manufacturers should focus on improving quality and after-sale services in addition to maintaining reasonable prices to survive in the competitive market.

He also pointed that many small workshops have began manufacturing UPVC doors and windows in recent years, noting that their products fail to meet the required standards as proper supervision on welding quality is only possible in factories with advanced machinery.

 No Export Due to High Costs

Most Iranian UPVC door and window manufacturers find it infeasible to export due to heavy raw material and production costs, explains Paymard, adding that manufactures often use UPVC profiles imported from Germany, while the fittings are imported either from Turkey or Germany.

Experts and business owners believe the fluctuations in hard currency exchange rates, which in turn affect the prices of raw materials, combined with high manufacturing and handling costs, lead to reduced competitiveness of Iranian products in export markets.

 Required Investment

To set up a medium-scale production unit, investors must establish three individual production lines to manufacture double-glazed glass, aluminum door and window systems and UPVC door and window systems. The capital required for purchasing machinery and equipment is about 8 billion rials ($240,000 at market exchange rate), with another 7 billion rials ($210,000) required for purchase of raw materials. Furthermore, since the majority of customers pay only after the units have been installed, another 10 billion rials ($300,000) is needed as working capital.

Setting up a medium-scale factory requires an area of about 2,000 square meters and 25 skilled workforce to operate the machines. Relevant permits can be obtained from the ministry of industry, mine and trade.