Hungary's leading high-rise builder on procurement: 'Change is the only thing that is constant at the moment'

We regularly write about the work of WEST HUNGÁRIA BAU Kft. , and in recent months we have published the thoughts of the company's managers and leading experts in our newspaper on several occasions. Now, Ilona Kádár, head of the WHB procurement group, has summarised her position in a professional article sent to our magazine on the importance and challenges of the field and their solutions:

"Every day is a real challenge, we are racing against time and prices"

- begins with an emphatic statement and then summarises the basics of the profession: procurement is about getting what a company's employees need at the best price, with the best deals and in the shortest time possible, to help them do their jobs. It reminds you that you are not only serving projects, but also colleagues in other areas.

Procurement is not like shopping

"Many people think that purchasing from a construction company is just buying building materials, but this is far from the case. We buy everything from the smallest thing - think a pen - to the biggest. I would cite forklift trucks as an example of the latter." Ilona Kádár adds,

Most of the time, it is the everyday products that are the most challenging, as managing a large corporate purchase is much more complex than an everyday shopping trip.

He gives an illustrative example: an ordinary person, when he wants to buy something, goes to a shop, chooses the product and buys it with cash or a credit card. In contrast, the situation is completely different for a business purchase: buying something that seems simple is not always as easy as the layman might think.

Purchasing is not a cash purchase, you can't buy products anywhere, so payment is not as simple as it is for a private individual. Despite this, of course, they try to get the product requested by colleagues to you as quickly as possible

- he adds.

Prices change during the time between tendering and construction - especially recently

The team leader will then move on to the main activity of the construction contractors, the implementation of projects. First, he stresses the importance of timing: "procurement is not an easy task, if only because the nature of the process means that projects have to be tendered for well before they are built, so that in the meantime you never know how prices will develop."

In this respect, neither the industry nor the purchasers of the WHB have had an easy time of it recently. The last three years have been a prime example of the unexpected, bringing changes that no one expected," he points out.

Covid, war, energy prices - challenges to address

"The first obstacle was the years-long Covid epidemic, which made the market situation difficult. Shutdowns, border closures and the resulting shortages of goods were the biggest problems in all areas of the industry. This was followed by the war in the neighbouring country, which first of all caused a shortage of raw materials, making it even more difficult to obtain products. Then came the rise in energy and fuel prices" - Ilona Kádár summarises the three difficult years and then explains:

"All this has led to a price rise that no one expected. The projects were not designed with these prices in mind, so what we buy and for how much became even more important, because in order to create "Maradando" (the manager quotes the motto of WHB - editor),we had to keep our eyes on quality."

"The information we received from our suppliers and the timely notification of shortages or price increases helped us a lot in avoiding material shortages."

The next group of his thoughts is related to this: moving on to the logistical aspects, challenges and solutions, he highlights:

before the epidemic and the war, costs were more predictable, but the drastic rise in prices made it even more important to compete with suppliers and manufacturers on this aspect, paying special attention to transport costs.

In addition, of course, in addition to suppliers covering the whole of Hungary, local companies also play an important role in ensuring that the right material gets to the construction site at the right time: "our company carries out construction work in several parts of the country, so we need to find dealers who can not only provide factory delivery, but can also meet the day-to-day material needs and be cost-effective from a logistical point of view".

You need to find common ground with your partners, find common benefits

On the time factor, which is of paramount importance in the construction industry, he says:

"Our projects often have to be completed on a tight deadline, so in many cases we are in a daily race against time. That's why it's important to find the best supplier and to build the right relationship with the vendors, because without them we wouldn't be fast and efficient enough."

He also stresses that WHB has close relationships with a number of large dealers and manufacturers, working with them to find solutions that help them get the job done. "We need their expertise to replace a material, to offer a technically identical product in case of shortage, to advise on possible solutions for construction projects"," he points out, pointing to the common interest.

The Purchasing Manager concludes his detailed summary with a very positive note:

"I am confident that, together with my colleagues and our manufacturing and trading partners, we have overcome the various obstacles and our team will do everything possible to continue to do its job as efficiently as ever."