Month: April 2020

Press Release: Impact on HVAC – Post lockdown

Staying cool post lockdown

The World Economic Forum (WEF) conducted a study on the 1918 Spanish Flu pandemic, recording a slight improvement in economic activity after the pandemic subsided. Today, economists are predicting a downturn of between 6%-10% in economic growth. What do we bank on?

At this point, post lockdown is fairly unknown territory. We cannot predict what loss the economy will experience or what shape the HVAC industry will be in once the lockdown is lifted. What is predictable is our approach to the crisis and inevitably the game plan we carry with us.

What is also a certainty is that the economy will “reopen” and over time, as seen in 2008, the economy will recover. For SARACCA members and other businesses operating in the HVAC space, the following steps are recommended to minimise impact and increase productivity post lockdown:

Health and Welfare

COVID-19 will not simply disappear after lockdown. Ensuring the wellbeing of staff is now more essential than ever. During the last days of lockdown, spend time planning the reopening procedures, while communicating the planned steps with your team.

Communicating to staff on payment shortfalls, leave procedures and possible retrenchments will not only create a better awareness of the challenges faced but will reinforce solutions on the table.

For business owners consider the following key tips:

  • Before you open up on the first day back, plan a motivational session with the team. Team spirit can overcome mountains of challenges.
  • Consider all the financial support available from the Government. You may require a capital injection for the next 3-6 months.
  • Ensure the business is fully equipped to manage recommended hygiene practices.
  • Be considerate, you are not the only person stressed and worried.
  • Be confident, things will improve!
  • Despite revenue shortfalls, it is recommended not to get into a price war with other companies, in the long run, nobody wins.

COVID-19 will not simply disappear after lockdown. Ensuring the wellbeing of staff is now more essential than ever. During the last days of lockdown, spend time planning the reopening procedures while communicating the planned steps with your team.

Operational planning

In some cases suppliers may not continue operating, leaving a shortage of supplies. Restoring revenue flows should be a top priority. Check-in with suppliers to ensure that products are available on request.

Sharing your operational plan with key customers could help build credibility and assist with your customers own planning. Projects may be iced and others brought forward. Engaging with all stakeholders may help build a strong operation plan post lockdown.

Compliance

Are all the staff’s SAQCC Gas registrations up-to-date? SAQCC Gas offices are open to assist with re-registrations or renewals. This encompasses OHS training. Training facilities can only take so many trainees. Pre-bookings is recommended for post lockdown training.

There seems to be more uncertainty in the HVAC industry that ever before. For many years the HVAC industry has sustained tight margins while navigating a sluggish economy. What lies ahead is a mystery to many.

The fact is, South African businesses operating in the HVAC space have always been resilient in the face of a challenge. What makes our industry especially tough is our ability to adapt and seek out opportunity. SARACCA remains committed to assisting members with material support and labour advice. Visit www.saracca.co.za for further information.

Press Release: No payment guarantee: Is it worth the risk?

The building industry is one of the largest contributors to the HVAC industry, many contractors, small and big, acquire a lot of business from this industry. However, an increasing number of HVAC contractors report a similar difficulty when entering into a contract with builders.

According to the JBCC Nominated/ Selected Subcontract Ed 6.2; the contractor shall 11.5.1. Provide to the subcontractor a guarantee for payment equal to ten per cent (10%) of the subcontract sum where required in the accepted tender (CD) within fifteen (15) working days of acceptance of the subcontractor’s tender.

The South African Refrigeration and Air Conditioning Contractors Association (SARACCA) hosts some of the most dynamic industry players, some of those members have reported a similar experience when entering a contractual agreement with builders. When HVAC contractors request a payment guarantee from the builder, as is expected, they are often denied the request and expected to carry the cost risks of completing the installations without receiving payment on time or any form of Payment Guarantee. It should be noted, it is not the responsibility of the HVAC contractor to fund the projects due to late payment of claims.

“Credit has always been a huge risk to the HVAC industry”– SARACCA Director, Barney Richardson

Based on a logical risk-analysis, an HVAC contractor should not enter into a contract which provides no payment guarantee. However, it has been reported that when one contractor insists on a payment agreement, the project manager simply moves on to the next contractor who is willing to complete the work without a guarantee and risk not being paid on time. Could this be contractual bullying?

On the face of it, the contractor could either, accept the risk of signing a contract and completing the work at risk and hoping to get paid. Or, reject the contract and be victimised and lose out on future work. For the growth and success of the HVAC industry, the contractors should be running profitable and reasonably safe businesses.

Competitiveness is healthy in every industry, however, poorly principled practices can jeopardise HVAC contractor by placing unnecessary risks in their way. The JBCC form of Contracts are there to protect all parties and must not be modified to the benefit of on against another

Press Release: COVID-19 digitalising the CoC

The digitalisation of S.A’s gas industry

There is no truer saying that pertains to our current situation than that of Emmert Wolf – “A man is only as good as his tools.” As the government-mandated certification committee within the gas industry. This covers the fuel gases and compressed gases plus the refrigerant gas used in air conditioners and refrigeration. SAQCC Gas has taken a key step forward in digitalising the certificate of compliance (CoC) for each sector of gas usage.  A first for South Africa, the introduction of an online CoC platform will help reduce fraud and improve data capturing.

Safety in numbers

If there is one lesson that COVID-19 has taught the world is that capturing, formalising and analysis of data is key to survival. Before COVID-19 hit our shores, Gas Practitioners were dealing with the realities of a slow economy and the crippling effects of illegal gas installations. Time and time again, Gas Practitioners would uncover fraudulent CoC’s coupled with below standard installations. Moving the issuing of CoC’s into the digital space will reduce the counts of fraud and increase the traceability of perpetrators.

SAQCC Gas’s mandate is to increase the rate of certification of practitioners while decreasing the amount of non-registered gas installers and refrigeration mechanics. In essence, SAQCC Gas has advocated the need for an improved working culture within the South African gas industry.  This encompasses trust in people, transparency of work, caring for others, as well as continuous learning.

The value of integrating

Right now it is crucial for Gas Practitioners, to create and maintain a strong pervasive digital culture. Integrating digital aspects into the workflow is essential. SAQCC Gas has the foundation and resource to equip Gas Practitioners with the technology needed to execute world-class service for fuel gases and refrigeration. The call is to encourage all Gas Practitioners to use and lean on these resources.

Regardless of the competitive position, Gas Practitioners across the spectrum will face a new digitally enabled market entrant. The introduction of the digital CoC forms part of a variety of tools available to all registered with SAQCC Gas.

For over 5 years, SAQCC Gas has embarked on a digital implementation strategy and all systems have been aligned to form part of the integration.

Global movement

According to Geoffrey Cann, Author of Bits, Bytes and Barrels, growth in gas demand is shifting to Africa, Middle East and Asian economies, with South Africa featuring at the top of the list. This is confirmed by similar reports from PriceWaterhouseCooper (PWC), ESI Africa and dailymaverick. Cann continues to highlight the trend – Anything that can be digitalised will be digitalised. Looking towards first-world economies there is a sense of a renewed digital race last seen in the early 2000s. Companies larger and small are re-evaluating the impact the digital economy is having on their business models and integration strategies.

How does this all affect a Gas Practitioner sitting in Pofadder? There is a sense of isolationism in the industry, with many objections coming in the form of territory or geographical reach. Companies situated in smaller regions tend to feel less inclined to affect change, specifically towards new working models. Lessons can be drawn here from COVID-19. Like the virus, digitalisation affects all. A recent study by ged-project.de identifies smaller cities and towns as key boom areas within the digital space. It is the benefits of digitising your business that will help breakdown distance, economic and location challenges. The key to growth now is relying on resources available, with a key channel being SAQCC Gas.

Visit www.saqccgas.co.za for further details.

Public Announcement: Gas compliance in Cape Town

To expand industry compliance in South Africa, the South African Qualifications and Certifications Committee of Gas (SAQCC Gas) is embarking on a Roadshow campaign. The objective is to reach everyone practising in the Gas industry and the end-user who utilises gas equipment. SAQCC Gas has been mandated by the South African Department of Employment and Labour (DEL) to ensure everyone operating in the Gas Industry has been trained and is qualified to safely complete gas-related work. SAQCC Gas registers all qualified Gas Practitioners, qualifying them as legal and compliant industry players.

Did you know? SAQCC Gas is made up of four associations that regulate different types of gas, these associations are; LPGSASA, SACGA, SARACCA, and SAGA  

The Pressure Equipment Regulations (PER) gazetted in 2009, regulates the installation, design, manufacture, operation, repair, modification, maintenance, inspection and testing of pressure equipment. These regulations have been in existence for a decade now. Despite this fact, there are still reports of illegal Gas installations completed by unskilled and non-registered individuals. Such installations are hazardous and unsafe and place the User at risk. 

On the 25th of February 2020, SAQCC Gas hosted a session in Cape Town. This has been one of the most successful sessions since the Roadshow campaign began. The actual number of attendees by far surpassed the anticipated number. There is a great need to educate and enforce gas compliance and related safety standards. The event was attended by the Department of Employment and Labour officials; Director of Electrical and Mechanical Engineering, Mr Malatse and Deputy Director of Electrical and Mechanical Engineering, Matlala Sathekge. 

The Western Cape Province has a concerningly high number of reported gas-related accidents mostly within the LPG sector .” Matlala Sathekge

The Cape Town session was attended by a variety of persons, amongst others were; older knowledgeable Gas Practitioners, newly registered Gas Practitioners, end-users and Fire Department officials. Director of Electrical and Mechanical Engineering Jakes Malatse opened the floor by introducing the PER, on which all other practices in the Gas industry are required to adhere to. One of the topics discussed was the importance of keeping up with the regulations. In his presentation, CEO of the Southern African Gas Association (SAGA), Roy Lubbe, explained the difference between the old Vessels Under Pressure (VUP) regulations which were replaced by the PER in 2009. Also presented a narrative and various applications in applying the regulations and standards pre and post 2009. This was vital content for the more senior Gas Practitioners who might have previously adhered to the VUP and were now required to align their work to the PER. This emphasised the importance of keeping up with compliance regardless of how experienced the Gas Practitioner might be. 

The Director of the South Africa Refrigeration and Air-Conditioning Contractors Association (SARACCA), Barney Richardson, spoke about the different registration categories, this was a very interactive session as there seemed to be a lot of misconceptions regarding the margins of each category. The Liquefied Petroleum Gas Safety Association of South Africa (LPGSASA) was represented by Zandile Msholoqa the association’s compliance officer is. One of the reasons that lead to non-compliance is Gas Practitioners practising out of their registration scope, Ms Msholoqa elaborated on the three basic training courses in the LPG industry: domestic, commercial and industrial. The objective of the Roadshow is to ensure registered Gas Practitioners remain compliant, to help non-compliant individuals hop on the compliance wagon and to educate the end-user on how to safely benefit from their gas equipment. This was indeed a successful roadshow! 

Public Release: Could the unemployment line be eased?

The unemployment rate in South Africa was reported to be sitting at a high of 27.1% in the fourth quarter of 2018. The number of unemployed people rested at 6.14 million, with employment figures only increasing by 149 000. Unemployment has been an ongoing issue in South Africa, various attempts have been made to try and eradicate this problem, and none seem to have worked entirely.

Although an overnight solution is not feasible, the unemployment could be eased. Around the globe, Temporary Employment Services (TES), play a significantly large role in providing employment opportunities. From an international perspective an example of such is TES contribution to the United States’ economy, providing outstanding job and career opportunities for more than 15 million employees per year.

There are many myths surrounding TES, or better known as “Labour Brokers”. However, in reality, professional and regulated TES provide a valuable service to the job seekers, businesses and consequently, the economy. These ensure that all workers, regardless of their contractual arrangement enjoy decent working conditions.

Despite opposition, there has been an increase in the use of TES in many parts of the industrialised and developing world.

Work has changed and continues to change daily in response to the drivers of the 4th Industrial revolution including job redundancy, skills revolutions and the shift to non-standard forms of employment.

We cannot ignore the fact that demand fluctuates and the composition of the workforce is not what it used to be. The digitalised and robotised era makes skills flexibility essential. The TES is adaptive to such changes. The 4th Industrial revolution cannot be stopped and the TES does not create casual labour, it simply provides an opportunity to manage and benefit from the current and further state of the changing rate of employment.

An increasing number of young professionals are opting to work through the TES model, with the recognition that clinging on to one skill set could be  limiting, with rapid fluctuation in the demand for certain skills. On the opposite end, the TES industry is proven to be an important entry point to the labour market and each year provides access to thousands of people many of whom were previously unemployed.

Like with everything else, compliance and regulation play a very important role.  Compliant Labour Brokers and TES may not have the capacity to eradicate unemployment completely, but the unemployment burden can definitely be eased, is it not time to adjust to a revolutionary world?