Builders taking a hefty hit
A GOLD Coast steel supplier says customers are taking almost two weeks longer to pay invoices as the industry deals with a severe downturn in activity.
Buyrite Steel Qld managing director Ben O’Bryan said builders, particularly in the house-and-land market, were struggling to stay afloat.
The company, which supplies steel reinforcement to mid-size commercial and residential projects, is owed more than $27,000 by MJM Projects, trading as Vystal Construction and Development, which went into liquidation last month.
The Carrara-based company owes suppliers, subcontractors and workers $4.1 million.
“I’m seeing the impact (of the downturn) in that homeand-land packages market and that has really taken a hit lately,” he said.
“There are a lot of builders struggling.
“Some of our competitors that focus on that market are struggling too but we don’t focus on it.
“Vystal themselves were using another customer’s account with us for about a year and they were trading and going all right so we gave them an account.
“They paid one invoice and then they were gone.”
Mr O’Bryan said he did not hold out much hope of seeing the $27,000 returned.
“This is the way it goes in our world. Sometimes we see nothing but we might see a couple of cents returned in the dollar. I’m not expecting much.”
It comes as new building approvals figures from the Australian
Bureau of Statistics shows a massive decline for the 12 months to December.
Housing approvals have dropped by 20 per cent and multi-unit approvals by 25 per cent.
Mr O’Bryan said he was seeing another impact, with customers pushing out payment terms.
“Our average payment term used to be 35 days and that has pushed out to 47 days,” he said.
“It comes from the top and trickles down.
“We are lucky we do not deal with too many tier one companies but I know they are pushing out (payment terms) as well.”
Despite tough times for home builders, Mr O’Bryan said the luxury home and warehouse sectors were going well and his company was expanding to enlarged premises in Yatala next month.
A Bulletin report this week revealed 18,000 building jobs on the Coast had been lost in the past 12 year.
Fresh data from Masters Builders Queensland showed building work to September 2019 across the state was down 9.2 per cent and the number of new homes under construction fell 26 per cent.
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