The builder, who has been involved in tools for more than 25 years, was forced to close his business permanently due to crippling costs and supply problems, which he said almost broke him.
Anthony Lococo of Torquay, Victoria, will close his construction company Lococo Build later this year, the latest in a long line of traders who are under pressure due to soaring material prices.
He explained that the lack of supplies, rising prices, and even finding traders to do the job were factors that gave him no choice but to give up his business – and go to university to retrain as a teacher.
This comes after several major construction companies have closed the store in recent months, with construction giant Condev of Queensland collapsing with Melbourne-based builder Probuild.
“It was a heartbreaking decision, but after two years of struggling to obtain materials and business, costs are constantly falling and eating into what even seemed like a profit margin,” Mr Lococo explained.
Anthony Lococo (pictured) will definitively close his construction company Lococo Build later this year, the latest in a long line of traders and companies giving up tools due to countless problems holding back the industry.
“I decided at Christmas that I just couldn’t stand it again next year. I’m exhausted and I’ve had enough.
“Trade reports said it would be just as bad this year, if not worse, and we just couldn’t. I have a family and I felt pressure. “
The costs of metal ores, plastics and wood have been rising steadily for years, but mainly as a result of a pandemic, with factories being forced to close for a long time.
The spill-over effect of these rising costs means that Australian trading companies are forced to pay the difference because they have entered into fixed-price contracts with their clients.
Mr Lococo (pictured with his family) told the Daily Mail Australia that the rising cost of building materials and staff shortages had no choice but to close his business.
“There are a lot of builders out there, I know a few of them. Many do not want to talk about it, but they feel the pressure, “he added.
A survey conducted by Master Builders Australia last year found that 98 percent of builders in Victoria were affected by rising prices and waiting times for materials.
Mr Lococo says rising material costs were perhaps the most significant problem that needed to be addressed urgently, and reveals that his spending has jumped by as much as 30 percent in a month.
He built the company with his wife “from the ground up”.
“I got to the point where I couldn’t even face the idea of going to the office,” he explained.
“Having to let go of my team is devastating, but I really have no choice.”
“You can’t run a successful business like this, you’re just leaning your head against a brick wall.”
Mr. Lococo is committed to completing all of his current projects, but admits that choosing an end date for his business will be a challenge.
Despite his decision to leave his business, Mr. Lococo wants to stay in construction and plans to take a university course to become a teacher of young craftsmen.
Michaela Lihou of the Masters Builders Association of Victoria, has developed a “crisis” affecting traders in Australia.
“We have a shortage of supplies, a lack of skills, and it’s a perfect storm right now,” she said.
Matthew Mackey, chief executive of Arcadis Engineering, said smaller businesses are likely to go bankrupt because they are unable to absorb cost increases like their larger counterparts.
“Smaller businesses don’t have cash flow, they don’t have the same safety net,” he explained.
“They will feel the pain much sooner and much more severely.”
Mr Mackey said suppliers felt distress after entering into agreements a month before material costs rose, so they had to bear the brunt of the difference and make only small gains, if not complete losses.
“Some people blame the pandemic, some blame the increase in material costs, but there is a bigger problem that will affect companies as large as smaller businesses,” Mr Mackey said.
While large companies handle large orders, SMEs are indeed struggling – with extended waiting times for materials that affect orders. Pictured are the traditions at the Sydney construction site.
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