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PLUMBING CONNECTION
AUTUMN 2015
RIP VANWINKLE AWAKENS
I
’ve been a keen observer of the
plumbing sector for close on 30
years and many readers have a
longer attachment than that.
In saying that, unless you’ve been
asleep for the last decade or two,
I’m sure there’s one common thing
we have all observed and that is the
never ending change of ownership and
control of the brands this industry
installs and services.
Many of the iconic brands Australia
was built on have either disappeared
or been absorbed under broader
corporate marketing umbrellas.
And if the past few months are any
guide, we appear to be in the middle of
a further wave of market adjustment
across the industry.
While plumbing product production
is an attractive business to many
industrial companies, it’s more
evident today that you either need
‘global market scale’ or a local niche
advantage in order to survive.
In some instances, new technologies
and materials have taken market share
and the enormous impact of China as
the world’s production factory over the
past decade has been overly disruptive
and will continue to be.
As in many industries, certain
categories have become
commoditised, thanks in part to the
impact of alternate sales channels
such as the large format hardware
chains and direct supply lines from
China and other Asian low-cost
producers.
Manufacturing in Australia today
is tougher than ever but many
businesses are still shackled by
age-old employment practices, work
agreements and under capitalisation.
New ownership can be a good thing
and wake-up belligerent employees
and unions to the fact that only way of
keeping their employer in business is
to improve productivity and business
viability.
Naturally everyone wants to sell
more and more product (or improve
margins by removing the middleman)
or directly import it, as can be
seen with the majority of plumbing
merchants today. But there are traps
and product recalls over the years are
testament to some bitter lessons.
In theory, the industry should be
better protected today than ever
by product quality (certification)
schemes but aspects of such
systems are occasionally bypassed by
unscrupulous suppliers.
The growing online market further
assists this compliance avoidance.
Which brings us to today.
As the sun settled on 2014, there
were a number of significant corporate
announcements in relation to a group
of this industry’s respected brands.
The saddest by far was the closure of
the Crane Copper Tube factory, which
had been in existence for 148 years.
Millions of homes are plumbed with
Crane tube and the company will be
well remembered for serving this
industry (and country at time of war).
JEFF PATCHELL
DISCUSSES THE CONSTANT CHANGE OF AUSTRALIAN BUSINESS OWNERSHIP AND MARKET
ADJUSTMENT ACROSS THE INDUSTRY.
INDUSTRY CHANGES