Despite the cost-of-living challenges facing Australians, many businesses and brands are still executing expansion plans to augment their physical footprint across the country. However, a concerning number are being thwarted by building issues.
The challenge facing retailers is the cost of building products and delays in build time. Fit outs and commercial and medical equipment are taking much longer to land due to ongoing supply chain issues.
Our business is currently in the process of rapid growth, planning on rolling out up to 30 new clinics over the next six to 12 months.
We have a number of sites due to open, however, we are experiencing some delays due to our builders not being able to meet their contracted timelines. They are blaming delays in product delivery and availability of skilled labour, which largely is out of their hands.
We are not alone. The problem is nationwide. The Australian business landscape is facing significant challenges as the building industry struggles with rising costs, labour shortages and product delays, impacting companies’ ability to expand and open new sites.
High costs and continuing supply chain disruptions
The building industry is still experiencing unprecedented increases in costs for materials and labour. Supply chain disruptions, compounded by global economic factors, have led to shortages and delays in obtaining essential building supplies. These challenges are causing substantial financial strain and project timelines to blow out far beyond initial estimates.
While conditions have eased slightly, they are still at highly problematic levels. There is also a lot of fear around the viability of building businesses too. Businesses are reluctant to invest too much upfront due to concerns around the financial health of building companies.
Impact on business expansion
The high costs and delays in the building and construction industry are severely impacting many businesses. Cosmetique’s plans for growth have been affected.
The ability to expand and open new sites is crucial for businesses like ours that aim to provide accessible cosmetic services across Australia. Unfortunately, the current state of the building industry is creating some challenging barriers to achieving these goals. We have had to recalibrate our growth plans to accommodate ongoing building industry issues.
Many businesses are being affected
Cosmetique is not alone in facing these hurdles. Businesses across various sectors are reporting similar difficulties. The increased financial burden and uncertainty around project completion times is leading many companies to postpone or even cancel expansion plans. This stagnation threatens economic growth and job creation.
Australia needs solutions
There is a need for immediate attention and action from industry stakeholders and government bodies to address these challenges. We need collaborative efforts to stabilise the supply chain, control rising costs and streamline building processes.
It’s essential for the future growth and sustainability of businesses across Australia. Many businesses have come out of the Covid haze keen to re-engage and activate expansion plans only to find that building and construction issues are still causing problems for many sectors.
Dr Vivek Eranki is CEO of Cosmetique, a leading Australian brand of beauty, injectables and laser hair removal clinics.