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58 E L EC TR I C AL CONNEC T I ON
S PR I NG 20 1 6
THE NEXT PINK BATTS?
T
he manuscript of a new
publication on the 100-year
history of NECA Victoria makes
for interesting reading.
It contains many references to how
our forefathers accessed product and
material, and it solidified thoughts I’ve
had for many years.
Our industry began with electrical
contractors buying and sourcing
material direct from manufacturers
and some ‘appointed’ distributors
throughout the country.
But over time the industry grew. So
did the number of suppliers, and direct
contacts were lost.
Today, the way we source product
is something of a free-for-all, and the
role of the industry wholesaler is being
challenged as never before. However,
there seems to have been a change in
the past two years.
Over the past 10 years there’s been
a substantial increase in contractors
sourcing their own product from
hardware stores or through direct
importation from Asia, made easy by
the internet. NECA research has proved
it. Technologies such as solar have only
increased this trend.
This attempt by contractors to bypass
a step in the established channel has had
added substantially to the risks involved
in running a contracting business.
It opens up the potential for non-
conforming product, financial problems
when dealing with an unknown entity,
warranty issues, product training and
many other pitfalls.
In an attempt to counter direct
purchasing many wholesalers introduced
‘private label’ product under their
own brands. Perhaps this is why some
importers and manufacturers put more
emphasis on marketing directly to
contractors. So it became a ‘chicken and
the egg’ situation.
In any event, contractors seemed
to win in this race to the bottom of the
price curve. Yet after the price bottoms
out the only thing that can move is
the quality.
The established channel via
wholesalers and manufacturers or
importers provides levels of protection
that cannot be argued against.
Some in the industry contend that they
have enough experience to handle the
risks in sourcing product, that they can
control quality and that certification is
correct and will be maintained.
However, the evidence of the past
few years has shown that management
of these issues is difficult even for
wholesalers (who do this for a living), let
alone contractors.
For instance, the entire industry has
made headlines because of faulty cable.
The product in question was not only
sold by non-mainstream wholesalers but
also by a limited number of established
wholesalers. And it was also imported
directly by contractors.
This particular issue is ongoing, and
will be for years.
In another instance NECA research
found that circuit breakers from different
suppliers were stamped with the same
certification approval number. Which one
was correctly tested and approved? How
would a contractor know?
LED lighting has the potential to be
this industry’s ‘pink batt’ moment. The
amount of LED product flooding our
market is phenomenal.
It’s impossible for individual
contractors to manage, test and monitor
each product’s certification. Why would
SUPPOSEDLY CHEAPER
MATERIALS CAN LEAD TO
TECHNOLOGY RISK, WARRANTY
ISSUES AND FINANCIAL
PROBLEMS.
WESMCKNIGHT
POSES THE QUESTION: SHOULD
WE CONTINUE TO SUPPORT THE
ESTABLISHED SUPPLY CHANNELS?
MCKNIGHT ON THE TOWN