Overseas Competitors

Where would Australia be without Imported Competition?

To finalise the events of 2006 and the market trends that follow it is safe to say changes in the market have brought many new players to the field of Warehousing. In the past months the market has opened to companies selling pallet racking imported from overseas. This trend, like any other commodity available for purchase in Australia is set to improve the market as a whole.

This is easy to see as market prices this past year have dropped considerably to make room for a more budget conscious marketplace. Industry leaders have in the past seen decades of the Australian market in a virtual duopoly, and with the addition of only a few smaller players these major Local producers have been able to supply at their own demand. That has left the Australian market with very little in choice and price differences and even less in services.

Certain major players in the pallet racking industry have set their object of focus this past year in discrediting the new competitors to the industry. These reputable companies are spending a great amount of time and money trying to discredit the options of the newly available imported racking on the Australian market that has recently appeared. These companies are now being forced by their new competitors to re-establish their own market-share, and join in becoming price comparable.

The last five years has seen the growth of all types of imported products filtering into the Australian market from Asian countries that are comparable in usage to any quality Australian made product. There are many examples in the industries of telecommunications, computers, plasma screen TVs, and mobile phones. The automotive industry has followed suit in recent times and brought the price of vehicles down by large percentages from what Australians would be paying if cars and parts were solely created and made in Australia.

Why are so many Australian companies looking to manufacture overseas and import their products into Australia? Everyone knows it has to do with the price. Quality issues are of little concern in the modern market as the technology available in other countries world-wide is sometimes even more advanced than what is available here in Australia today. Importers in almost every conceivable market would understand that modern technology and engineering are available world-wide, and production in factories overseas has seen many large and reputable companies opting to produce their designs in virtually the same fashion as the Australian marketplace for a lot less in cost.

The most interesting insight is that the very companies who are focusing their attentions to keep new players out of the Australian market are also importing from other countries for the same cost advantages. Certain competitors are importing particular beams from Malaysia, and drive-in racking. These companies have within themselves opted to utilise better cost advantages in the imported markets to increase their own profit seeking goals; and this has for some, become a costly disadvantage in the long run. Certain members of these organisations have also opened the doors to profiteering their own importation and sales of pallet racking through privately owned local businesses.

These players have witnessed to the Australian market; that somehow, the Australian Government would accept and allow importers to bring into the marketplace inferior components and pallet racking that could be dangerous to Australians. The facts remain that all pallet racking must conform to the set guidelines stated in the Australian Standards AS 4084 and completed compliance testing. These certifications must be available to the public and signed by qualified experts with years of engineering credentials. To infer that Australians would be accepting of purchasing pallet racking that would harm warehouse operators is a select type of propaganda fed to the public to protect the very high prices these companies used to be able to charge Australians without any competition. These companies are trying to preserve and justify their own pricing schedules and their own profit margins and keep their shareholders happy.

It is insulting to the industry that, in sensational statements made in the media and posted on websites; certain companies are misleading consumers to believe that whole engineering departments of major Australian Universities are unqualified, and producing certified results that are untruthful. It is interesting to note that these companies have further completed their "own" testing of random articles from some imported pallet racking and have mis-calculated these results based on USA standards. These mis-calculations have produced results that have mis-informed the unaware public to believe that the Load charts of some imported racking companies are false. These statements to mislead the public by incredulous "warnings" are simply not justifiable.

The FEM world standards are not yet the Australian based Standards, but are Internationally recognised. FEM Standards may indefinitely become the Australian based Standards, and indeed the market recognises the merits of the FEM. However, the majority of importers have also recognised the future in the market is achieving the FEM standardization and are in fact already implementing these into production; for some time, in order to gain safety assurances and remain market capable. The future will see that the majority of imported pallet racking will be defined within the industry by those importers who have the FEM Standards and who have implemented all necessary quality control methods within their factories, and who are completing on-going and random compliance testing.

It Is further noted that at the end of 2006, certain major players in the pallet racking industry are now claiming to be preforming tests on their racking. This they say, is to ensure the "safety" of the Australian consumer. It makes you wonder how often these companies have been previously and randomly been compliance testing prior to their new competition arriving. It is certainly excellent that these companies are now looking at the true safety and consistency of their own production methods, but Australians should be reminded that we are unaware exactly what, when, and how much testing is occurring and Australian Standards is a guideline.

The facts remain, large local suppliers in the pallet racking industry will continue their missions to exclude the imported pallet racking and base their fundamental efforts to re-gain loss of their credibility from previous dropping service standards, and high quotations, and bullying in the media. It will be interesting to see with so many new players in this market how these old timers will fare in being forced to become price competitive and drop their standard prices considerably to remain competitive, as seen in the tendering processes in the market.

One importer, Alpha Warehouse Solutions, is confident that 2007 will be a defining year for the whole industry and will see the level of quality and service standards continue to rise. Competition in all markets is healthy and produces choice, and equal opportunity for all Australians to gain a better return on their investments. Safety is a concern to everyone and will not, and should never, be compromised. It is beautiful that the marketplace is coming together to provide better safety results and more information available to the consumer for the entire industry. It is competition that has highlighted the new improvements of 2006, Alpha Warehouse Solutions, is committed to bring even more innovation, services, and continue to set the precedence of excellent value for quality in the pallet racking industry. "Bring on the competition!"