Current economic conditions combined with a solid dose of South African entrepreneurship, has seen an escalation in the activities of what is commonly referred to in industry, the ‘Bakkie Brigade’.
This term is used to describe contractors in the stainless steel industry, who do not necessarily comply with legislation, certification and other compliance issues that standard industry is burdened with. Coupled with the fact that they have virtually no overheads, they undercut credible suppliers and create havoc in terms of market expectation regarding realistic costs.
They also tend to deliver material grades and workmanship inferior to that required for the application or as set out by the applicable safety and industry related standards. In their wake lies a path littered with rusty and unsafe balustrades and failed products making it difficult for the stainless steel industry to market its products as a credible and cost efficient solution to other materials.
As stated earlier, much of this activity can be ascribed to weak economic conditions in the country. Whilst there is always an element of this type of behavior, it seems to increase when the economic hard times hit. This includes the spectre of retrenchments in the industry and low chances of re-employment, which makes this type of unsustainable contracting method a financial necessity for many.
Unfortunately, these ‘contractors’ do not necessarily have the business skills or equipment required to run an engineering concern and seem to prefer to try and gain the advantage against more conventional competition based on price.
This mixture of not being able to understand an income statement, taking specifications beyond safe limits with favorably low overhead costs wins them the day, but tomorrow might be lost for them and their conventional competitors.
In addition, the low costing presented to the market, creates an expectation that these rates are reasonable and that all suppliers should be able to compete at these margins. This has a devastating effect on the long term profitability in a market segment as experience has shown that it can take more than a decade for market related prices to be at decent profit margins again after being subject to the “Bakkie Brigade”.
However, the market is also guilty in sometimes awarding a contract based on price and not necessarily competency. End users also experience pressure on funding available for projects and the “low-cost” solutions presented by these operators look attractive. For example, if a balustrade fails, and it leads to injury or death, some difficult questions start to pop up. Who authorized the design, was the installation tested for side impact, was the material grade selection adequate for the application etc?
Making use of ’fly by nights’, also doesn’t allow the end-user much recourse in the event of a failure making this a financial risk. Keep in mind that most of these operators do not adhere to labour legislation; are not registered for tax and, in most cases, do not have Public Liability Insurance or the financial resources to cover damages even if taken to court.
Where Sassda has been successful in dealing with this issue is within the fabrication sector, where the issue of dubious suppliers was efficiently addressed by educating our fabricating members in terms of the use and understanding of material test certificates.
However, where the problem persists is with sketchy consumer products reaching the end user through retailers, and Sassda continues its efforts to trace dumped goods and facilitating import duties on them. However, it remains an issue in the Architectural, Building and Construction sectors where sub-standard materials, design and workmanship are being supplied to unsuspecting end-users with potentially fatal results.
The Australian counterpart of Sassda has been very successful in this regard when rolling out an accreditation scheme for architectural fabrication and installation. According to this scheme, an accredited fabricator will have to be able to demonstrate stainless steel related knowledge, skills and competency to be accredited.
This does not mean that other members are now excluded from potential opportunities, but rather a benchmark for excellence that can be worked towards. It also makes it easier for end-users and specifiers to find competent suppliers and will make stainless steel products and installations world class marketing material for stainless steel.
Sassda has adopted a similar approach as part of the 2019 strategy plan to initiate an accreditation scheme for the architectural sector with a view to expanding this to the hygienic fabrication sector at a later stage. It is believed that this approach will make it easier for Sassda to market the material and membership during its regular interaction with architectural institutes and design houses.
It will also act as a catalyst for a training drive in the architectural membership in order to reach accreditation. This will be instrumental in raising the bar in terms of architectural competency and capacity in South Africa. Sassda is also actively involved with SABS workgroups tasked with regulating and standardising the building and construction industry ensuring that stainless steel is specified correctly in all relevant standards and looking for ways to ensure stronger enforcement of the regulations and codes thus forcing the Bakkie Brigade to either conform or go bust.