According to Richard Williams, chief executive officer of the Gordon Verhoef and Krause Group of Companies, 2013 has been a tough year for most contractors as we start to emerge from the worst of the recession.
According to Richard Williams, chief executive officer of the Gordon Verhoef and Krause Group of Companies, 2013 has been a tough year for most contractors as we start to emerge from the worst of the recession.
“We believe that 2014 will be better than 2013, but that growth will be gradual and possibly erratic.”
Williams says they are slowly coming out of the recession but must understand that its effects will be with us for a couple more years, if not longer.
Already, he says we have already seen a number of business closures and he believes there will be more to come before we see the last of the recession’s effects on the industry.
Margins have been tight and although ‘suicide tendering’ has abated to a degree, it is still evident in the market, which is not good for clients or for contractors bidding at sustainable prices, he notes.
There has been a general increase in work volumes, but these are far from ideal. This is a time for contractors to stick to the basics - ensure they have sufficient cash reserves, tender realistically and deliver good quality and service.
For the Gordon Verhoef and Krause Group of Companies, this uptick has been seen in an improvement in private sector work on a national level, particularly in areas such as private healthcare and education along with commercial and leisure refurbishment projects. There is room for improvement in this market however, particularly in the Western Cape, he points out.
“We have also been fortunate to secure a number of government projects, which have formed the bulk of our turnover recently.”
Williams says government is in the best position to deliver a consistent workload to the construction sector and thereby reduce the effects of economic cycles.
This would stabilise the industry, keep people employed for longer and thus enable the growth of a strong skills base.
“Our industry has the capacity to absorb large numbers of unemployed people if a steady workflow can come from government.”
However, he says this must be coupled with large scale training programmes since one of the biggest challenges facing our industry is the shortage of skilled personnel at all levels and the lack of sufficient training programmes and facilities.
There have been moves afoot in the private sector to run development programmes, such as the artisan, skills and bursary programmes run and sponsored by the Master Builders Association of the Western Cape.
However, these can never be on the scale required to service the industry as a whole and I believe this issue needs addressing by government on a national scale and, more importantly, that the training outcomes produce artisans of the standard required by the industry, according to Williams.
To ensure the continued success of the company over the coming year, Williams says that it will focus on employing and developing the best people to deliver quality to its clients, working to its strengths and further improving its performance in Health, Safety, Environmental and Quality management.
The group also aims to continue building quality relationships, increase the value of its anchor projects and improve its project continuity.
“We are optimistic for the year ahead, albeit cautiously so,” he adds.
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