The Whole Construction Sector Is So Inherently Related Disaster Can Widen Rapidly
The supply chain is a very delicate set of connections, as most businesses know and damage to the chain can seriously impact on your individual business profits. This is a worry for many different kinds of markets as they generally have very little control over the other companies that they work with. This is especially so in the construction industry. Of course there are 100’s, if not 1000’s of companies who offer similar services to each other but most of them will be connected in to supply chains with other groups of companies and the majority of their work will be with this collection. In construction there are hundreds of manufacturing processes required as well as multiple trades, professions and fittings manufacturers. So within one chain you will see the designers and engineers the steel workers the construction team working in conjunction with makers of industrial doors, carpenters, plumbers and the list goes on.
Visualise then if there are problems with some of the stand alone organisations in the chain. As they are all likely to some extent or other to work with the same set of businesses these problems can have a detrimental effect on what appears to be seemingly disparate business down the line. This is especially true of the chief contractor. If problems happen with that firm, if projects become scarce the knock on effect reverberates both up and down the whole chain and may possibly devastate some smaller companies who do not have other contracts outside the contaminated chain.
So in this tough financial situation where the majority of public sector construction projects have been delayed or even binned, it is straightforward to see how the problems can cause issues elsewhere. The designer is not requested to draw, the industrial door manufacturer is therefore not picked by his team who recognise the capabilities of his door; the steel work is not designed or produced and no fixtures and fittings are required. The results can be catastrophic.
The answer is as usual, do not put all your eggs in one basket, the threat is too large and your chances of getting through the downturn severely hampered.
