How coronavirus (covid-19) could impact your construction project

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​Whole regions are being quarantined to prevent the spread of coronavirus (now called covid-19). Thankfully for most of the World so far these areas are mainly in China, with pockets in Italy, South Korea and a few other countries.
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Obviously for many there’s no reason to panic and the virus seems a long way from most of us. But, no matter where you are in the world your construction project could still feel the ripple impacts of coronavirus. 

How coronavirus could impact your construction project

1. Shortage of materials and equipment. We live in a global economy and many products used on construction projects are manufactured in China or South Korea. Even items manufactured elsewhere could incorporate parts from these two countries. Items impacted can be simple products like nails and screws, but they could also include many electronic components. Some items on your project could also come from Italy, these could include ceramic and marble tiles and some equipment. Inevitably there will be shortages of some construction items and prices could rise for items which have to be sourced elsewhere.
2. Clients invested in affected regions, or relying on revenue in these areas, could suffer cash flow problems, and even lose money. If your client is exposed to the impacts of coronavirus this could impact your payments. Is your client immune from the impacts of coronavirus?
3. Many businesses are becoming more averse to taking on extra risk and starting new construction projects when the full impacts of coronavirus on their business are still unknown. This will delay the start of new construction projects. Projects already running may be slowed or trimmed to reduce the impacts of the project on the rest of the business.
4. General panic among workers. This could result in people refusing to work with workers of Asian background, or even possibly not working with someone displaying flue like symptoms. This will disrupt work.
5. Workers travelling to affected regions, or who have travelled with people with the virus, could be quarantined for two weeks or more, which will impact production.

What you can do to protect your construction project

1. Understand where products incorporated in your project are coming from. Ensure you have sufficient stock. Track the items if they’re coming from regions impacted by the virus and ensure they’re dispatched on schedule. If necessary look at procuring these items elsewhere. Always maintain sufficient stock of materials on your project.
2. Read you contract and know if you can claim for delays caused by the unavailability of construction materials and equipment due to the impacts of the virus. Most contracts will say that the coronavirus outbreak is a Force Majeure event, which usually means the contractor can claim for the time lost due to the delay, but not the associated costs. So you’re not going to be recompensed for the costs associated with the delay which will hurt your company. In some cases, where you’ve elected to purchase items from coronavirus hotspots while the item was readily available closer to home could mean that you can’t claim an extension of time for delayed deliveries.
3. Ordering materials from areas currently under quarantine or impacted by the virus, where you should have been aware of the restrictions, could leave you little recourse to claim for a delay caused by the virus if the items aren’t delivered in time. So it’s important to diligently research your construction products' origins before you place an order.
4. Warn your client as soon as you know there could be a delay caused by materials being unavailable. They can take alternative steps to mitigate the impacts of the delay, and even specify different products.
5. Understand your client and their business exposure to the virus. Are your payments secure?
6. Display posters and conduct info sessions with employees on the symptoms of coronavirus and how best to avoid catching it. Avoid hysteria and panic.
7. Encourage good hygiene and see that there are sufficient hand washing stations on the project. For further information on getting your workplace ready for the virus read this advice from the World Health Organisation.
8. People with flu-like symptoms should be sent home and encouraged to see a doctor.
9. Encourage employees to have flu vaccinations. This won’t protect against coronavirus but will prevent other flu’s which could weaken immune systems making employees more susceptible to catching the virus. Anyway, workers suffering from regular flu could cause panic amongst other employees who may automatically assume it must be coronavirus.
10. Check new project contracts before signing them to ensure that you are protected should the coronavirus impact the project.

If the virus spreads to your area

​Keep an accurate list of people working on the project and entering the project. This should have contact details in the event that someone is taken ill with the virus on your project, so that people who have been in contact with the ill person can be contacted.
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If your region is directly impacted by the virus there will be transport disruptions. Workers may be prevented from coming to work. Have a plan in place to secure and shut down the project so that it’s safe. Work could be disrupted for several weeks.

​Keep your client informed and discuss closure of the project with them should this be necessary. 

Conclusion - control the impacts on your project

Coronavirus may have only a small impact on your construction project. However, it’s important to be prepared and understand your supply chains and how your project could be impacted.

For the present avoid undertaking projects in areas at risk of the virus. Avoid travelling to risk areas.
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Hopefully the outbreak of coronavirus or covid-19 will quickly pass into the medical history books, as did SARS and swine flu.

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​Paul Netscher has written several easy to read books for owners, contractors, construction managers, construction supervisors and foremen. They cover all aspects of construction management and are filled with tips and insights.
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