Pandemic stretches plumbing, electrical supply lines
A shortage of building supplies is preventing the construction sector from delivering projects on time and within budget.
Plumbing, electrical and glass suppliers are reporting difficulties getting their hands on basic materials because supply lines have been stretched by the coronavirus pandemic.
Active Electrical Suppliers general manager Kevin Pollock said he had found it progressively harder to bring products in since the middle of last year.
‘‘The consequences of these delays means that the product installation by trades personnel is also delayed and in some instances alternative products are sourced but this requires additional time and resources to manage as well.’’
Master Plumbers Association chief executive Greg Wallace said the challenges were the result of a unique set of circumstances combining to create a perfect storm.
‘‘Suppliers predicted a downturn on the basis of all the banks and everyone else predicting a downturn, and reduced some of their forward orders. Most of the plumbing items come from overseas and there’s a lag of three to four months, so that’s one issue.’’
That decision by suppliers had been compounded by an unexpected spike in home renovations as well as the severe congestion at the Ports of Auckland, he said.
The country was not going to run out of supplies, but the delays were causing headaches for plumbers and gasfitters. If they had to change equipment halfway through a job, they would have to go back to the council to ensure compliance with the building code, Wallace said.
To make matters worse, the supply of some products would fall when production in China slowed down for Chinese New Year celebrations in February, Wallace said.
Construction industry expert James MacQueen, a partner at business advisory firm BDO, said construction firms could end up paying for the delays.
If there were hold-ups with work such as plumbing, it would delay all the other work that followed, he said. ‘‘It can be a significant issue because most building projects have a very clear timeline . . . Often, particularly the larger firms, there’s liquidated damages if a building is not finished on time.’’
Liquidated damages are a financial penalty construction firms receive for each day a project is delayed.
MacQueen said there was a long-term risk the ongoing delays could see some firms fall over, in particular those that had a number of projects on the go facing similar challenges.
All the suppliers RNZ spoke to expected the delays to continue to at the least the end of March. Their advice to customers was to be patient and be flexible. – RNZ