The effect of Covid-19 has been felt across the globe, with it having a particular impact on the building and metal fabrication industries. From isolation to border closures, there has been no shortage of interruptions to the industries and how they operate. Over two years since Covid was first identified in December 2019, and the metal fabrication and building industries are still unfortunately feeling the effects of these disruptions. While The Fabrication Company is lucky enough to avoid most of these disruptions due to operating completely in-house, COVID-19 is still causing issues despite the worst of isolations and lockdowns seeming to be in the past.
Supply chain disruption
One of the biggest effects of COVID-19 that we saw was the immediate lockdown and border closures in an attempt to control the spread. This saw direct impacts on the building and metal fabrication industries supply chains. Many materials are imported internationally, particularly from China which was one of the first to lock down. Steel mills in China were also forced to close for large periods of time due to lockdowns and shortage of workers. This resulted in significantly declined production of steel, and impacted imports as countries shut down their borders.
These initial stages of supply chain disruption were a catalyst for further disruption. This now includes price increases due to the lack of supply and the high demand while trying to catch up from the last two years. Raw aluminium and steel materials saw an increase in cost of anywhere between 40% and 80% depending on the individual product. These prices fluctuated constantly, and still change currently. Constant pricing adjustments from suppliers meant the industries affected found it nearly impossible to honour pricing in a contract for any more than 30 days. If contract pricing was honoured for longer periods of time, businesses more often than not saw a loss as their cost pricing went up but they were not able to charge the customer more.
These pricing and supply/demand issues are still being felt now across industries. Due to this, many companies are unfortunately liquidating. This only further perpetuates the issues with supply and demand, as the companies that are still in operation are picking up jobs that would have otherwise gone to the now liquidated companies.
Financial instability across the industry
Feelings of uncertainty are extremely common across the industry at this current time, with a lot of companies being understandably financial unstable because of COVID-19. Because of this, many supply companies must attempt to mitigate the risks wherever possible, whether that be increasing deposits or bringing payment forward well before completion. This can be a large change to a businesses operation, and can put a strain on both parties involved in a contract.
Our experience
In general, The Fabrication Company has been lucky enough to be rather well placed to ride out the storm of COVID-19 interruptions. Due to being an all in-house manufacturing facility, we have managed to avoid any major disruptions. As a privately owned family business, we reinvest in machinery and technology, while continually improving our manufacturing efficiencies. This is so we can continue to deliver high quality product that is competitively priced, with fast turnaround times that rival those across South-East Queensland.
If you are in the market for a metal fabrication company, The Fabrication Company is the one stop shop for you. Contact the friendly team today to find out more about our capabilities and how we can help you complete
