Storage Racking Leadership Discussion

On Thursday 2 August, BVT Engineering Professional Services (BVT) gathered industry leaders to discuss the challenges and opportunities associated with storage racking compliance in New Zealand.

Globally, storage racking is big business, with e-commerce solutions and consumer demand requiring retailers and wholesalers to optimise their warehouses and retail spaces as efficiently and effectively as possible.  The use of pallet racking and vertical storage bays to achieve optimum use of space is vital to ongoing competitiveness within the market.

These global trends are reflected within the Trans-Tasman environment.  However, in New Zealand, the installation of racking is complicated further with the need for seismic compliance and consenting process requirements. A consistent theme emerging across a range of industries is that businesses are struggling to navigate the strict central and local government requirements.

It was against this backdrop that BVT Engineering Professional Services convened an industry discussion, with leading manufacturers, retailers and wholesalers, led by a panel of experts including:

• Francois Barton, Executive Director, Business Leaders Health & Safety Forum;

• Graeme Beattie, Principal Structural Engineer, Building Research Assocation of New Zealand (BRANZ)

• Richard Kaggwa, Building Consents, Auckland City Council; and

• Tania Williams, General Manager – Engineering Leadership, Engineering New Zealand

With over sixty people in attendance, Matt Bishop, BVT’s Managing Director led a panel discussion with strong engagement from across the floor. Attendees articulated how the complexity stems not only from the varying levels seismic compliance requirements (dependent on a number of factors including geography, use and geological conditions), but the interpretation and application of standards varying greatly across the country.

Commercial Impacts

An attendee confirmed that the international retail company where he worked, has had vastly varied experiences getting project consent through from councils across the country.  He spoke candidly

“We have consent issues which go round and round the approval process and we lose weeks in the process of opening a new store. Consequently we lose labour from the project as they seek work elsewhere when our projects fall behind schedule and that impacts back into the wider economy.  A resolution from the owner-occupier perspective would be to get clarity about how many producer statements we need and which ‘bucket’ does each fall into? It’s a grey area.”

Why the variation?

The panel and audience agreed that one of the major challenges lies in definitions.

“The classification of storage racking as a building (as opposed to a shelf system) means different councils have different interpretations.  Nobody has defined where a “rack” stops and a “shelf system” starts; the latter may be 2 meters high and regularly de-mounted and moved around in a retail store. Clearly they are not the same.  High storage racking is treated as being a building but there should be limits to define both.”

It was revealed during the discussion that the current definition dates back to a letter drafted some twenty years ago. This definition is still being used stating that storage racking is a building which indicates that a building code is the correct document to conform to.

The factors in the loading standard are similar, with different engineers taking different interpretation of the standards, causing further inconsistencies.  It is understood that one of the key factors leading to the variation in the standard is the inconsistency in the range of building life the asset needs to meet, be it 25 years or 50 years.

“There is no set accreditation manual which all councils use.  For the lay-person it seems odd because the building code is identical nationwide and if the local soil is similar, everything else should be the same.  I would prefer there to be identical systems throughout the country.”

The attendees were united in consensus that the definition of racking, and its associated regulations, needs to be made clearer by Ministry for Business Innovation and Employment (MBIE) in consultation with stakeholders, including manufacturers, engineering community and retailers.

Industry Advocacy

The event attendees and wider industry colleagues are prepared to invest and lead discussions with MBIE to champion change.

Some practical solutions were recommended around the consent process – including meeting planners and engineers at the pre-application stage to review a project.  The importance of pre-consultation was emphasised around buildings not specifically designed for a specific racking system and the consequent issues for fire engineering and change of use.

Collaboration and partnership is what most councils want to achieve on a project-by-project basis. An achievable medium term goal is getting common practice between councils.  Yet the ‘big sheep policy’ of consulting big councils and agreeing a common view first and bringing others in later isn’t a quick process.

Learnings could be adopted from other industries, for example Forestry where there is now an industry contractor-certification scheme being rolled out.  This is both industry-driven and Government supported. Forestry had clarity on what the dimensions of the problem were and this alignment helped the process to progress rapidly.

What’s next for racking?

Industry leadership and the largest racking manufacturers are robustly behind creating a dialogue and agreeing common standards with MBIE to champion change. In summary the issues can be categorised as follows:

1. Lack of clarity with regard to what constitutes racking and application of standards;

2. Inconsistency in consenting processes around the country;

3. Reducing regulatory burden on businesses; and

4. Ensuring compliance with standards to minimise loss of life should a seismic event occur.

To this end we propose a time-limited working group to modernise and adapt existing standards regarding storage racking.  This group should involve central and local government representatives, together with industry leaders.

It is clear that if we want to continue encouraging investment and innovation in New Zealand and encourage international businesses to operate here, we need to make it easier to navigate the seismic regulatory environment.