Builders hurting as Bowral Bricks stops supply of some bricks for three months
Bowral Bricks has stopped supply of its Bowral Blue and Shorthorn Mix bricks until February 2013 in a move which builders say is hurting the already struggling construction sector.
Bowral sent an email to it construction clients advising them that new orders for bricks will not be able to be supplied until early February 2013.
"As many of these products have a very high demand placed on them, we on occasion cannot produce large enough quantities to meet this demand," the email stated.
However, Mark Ellenor, general manager of Bowral Bricks in NSW, told SmartCompany the stoppage is a result of repair work to five old kilns which date back to 1910.
"It is only the two of those lines that are affected. Overall, we have got more stock than we can jump over in NSW," he says.
"We have so many bricks because it has been downturn for the last 10 years all the manufacturers have an abundance of supply."
Ellenor says the construction industry will not be impacted by Bowral's stoppage.
"We have built up stocks of these bricks for every order that has started in our system so there will be no jobs that will be delayed. It is only new jobs that come through for those particular products which will have delays."
Igor Vavrica, director of NSW business Project Design Services, was one of the business owners dismayed to receive Bowral's email. He told SmartCompany stoppages like that by Bowral is one of the factors sending builders broke.
Vavrica says his business has been caught out in the past by manufacturers failing to supply.
"It has really driven me mad as this has been happening a lot and builders get caught in it, especially considering that we have fixed term and fixed price contracts, and when you get material not available for three months it sends builders broke," he says.
"This did not affect us. We were very lucky this time. But this is an indication of not very smart management."
Radley de Silva, deputy executive director of the Master Builders Association of Victoria, says the building industry is under increasing pressure.
"There are a variety of impediments including planning delays, supply delays and weather delays that add to the time it takes to build and therefore the cost of building," he says.
The Master Builders Association says in Australia's new housing starts dropped 11% in 2011-12, with around 139,800 new dwellings started compared to 157,500 the year before.
Work is down and jobs are being shed, de Silva says: "Restricted lending practices and lower consumer confidence are also adding to the pressure."
"Times like these require innovation and new ideas to combat market trends.
"Governments need to look at cutting back impediments that would allow our industry to thrive and encourage investment in new building projects."