The combination of bushfires, coronavirus (COVID-19) and the lunar new year holiday has created a perfect storm for manufacturers of P2 dust masks this year, with the surge in demand far outstripping manufacturers’ expectations. And while heavy rain douses the fires and health authorities make progress on managing the COVID-19 epidemic, manufacturers of the masks are warning of an economic flow-on effect that we’re yet to see.
“I wouldn’t say we’re out of stock, but we’re really right on that knife edge, and any containers that are coming in are going straight out,” explains Brad Rodgers, R&D manager for Paramount Safety Products. “We’re not able to get ahead of the game, and it’s just managing stock very closely to ensure that our regular customers and the people that use them to continue their working life in Australia are satisfied as well.”
Paramount Safety manufactures Pro Choice Safety respiratory gear including disposable face masks and half-mask respirators. Rodgers says the supply challenges have come from two factors; a spike in demand from the general public, and a surge of orders from inside China. It’s complicated by the Chinese government’s restrictions on exporting, and the extended shutdown of manufacturing plants beyond the normal lunar new year break.
“Paramount’s been importing and wholesaling since 1992,” he explains. “Every year during Chinese New Year, from the end of January to February, we increase our order volume significantly just to counteract that time off from production.
“The pressure was already on because the bushfires— when enquiries for masks started coming in from the general public, that’s where the economies of scale are well beyond what any business can plan with their stock forecasting. Stock levels were already at a low, and the virus made it a significant challenge. We managed that daily and our current communications at the moment is that some factories are back but on limited production. Some factories are not back. We’ve heard the Chinese government is staggering the start of working hours depending on factory type and what they produce. More of the essential products are coming back first,
and some of the others will come back later. That’s challenging too, not knowing when production’s going to start again.”
Paramount has manufacturing plants in China and Vietnam, but it isn’t an option to switch production to another country. “I don’t believe there’s enough factory or capacity outside of China around the world to satisfy this demand,” Rodgers explains. “And any factories that are outside of China are reliant on raw material from China.”
Nonetheless, he says Paramount are committed to looking after local regular customers. “But the knock-on effect through the economy is probably yet to be understood,” he adds. “There will be issues because there’s definitely been stock going to back to China and not satisfying the local demand. And stock that is being sold here in Australia could be getting sold at higher prices, but we just encourage our distributors to keep a cool, calm head. Your customers have been with you for a long time and you want to support them and ensure you can get them through this tough time. Because if they can’t work, that means the short spike in sales are short term gain, long term pain.”