Likely you have heard about “supply chain issues” – it is hard not to have! But, what are these issues and how do they impact flooring?
A supply chain for a certain product begins where the raw materials required to produce it are sourced- for many products this will actually be more than one place. The chain continues as these materials are transported, processed and combined, transported again, finished, and shipped to their final destination. When you consider engineered hardwood, for example, you are dealing with supply chains for lumber, adhesive, stain, and sealant. Supply chain issues can arise anywhere along the way – and during the past two years of pandemic they have arisen at almost every step!
A high demand for flooring and other other construction-related items has led to a general shortage when it comes to what is available to consumers. This alone will increase the wait time (and sometimes the cost) required to get a certain product to your home for installation. Manufacturers want to get their product out just as badly as consumers want it to arrive in their home. All along the supply chain, people are striving to move things along as quickly as possible – but, as you have heard, they are running into some “issues.”
Lockdowns and labor shortages have slowed production at the beginning of the chain and all along the way. High demand should lead to increased production, but it can’t when workers are home quarantining and factories are closed or operating at reduced capacity. Supply chains are global, so the state of viral spread and the mitigation strategies in place will vary – meaning materials sourced from one part of the world may be much more readily available than from another depending on the state of things in their country of origin.
Availability of raw materials may be limited by a variety of circumstances – some materials are simply hard to obtain, but unexpected weather events can impact refineries, chemical production and harvesting or mining.
Shipping containers are at a premium – space available to ship materials is less than the materials waiting to be shipped, so many items are simply waiting for transport.
Labor shortages at ports where shipping containers arrive – by the barge load average of 81 20-foot containers – slow the process of unloading. These shortages may be brought on by a decrease in available skilled labor, quarantine requirements, or mitigation strategies such as social distancing that require fewer workers in any given area.
Transport delays continue subject to the availability of trucks and truckers.
Once the required materials arrive at the manufacturer, production can begin – subject again to the availability of labor which may be in short supply. Ultimately, the product does get out to consumers, but these days it is often taking longer than it did two years ago.
Not only do supply chain issues lead to an increase in wait time for products, they can also lead to an increase in cost. The cost to procure raw materials goes up when demand is high as multiple manufacturers hoping to get the product first may bid against one another and drive the price up. Similarly, the cost of shipping container space has risen significantly as a backlog of shipments sits waiting. Each price increase along the way adds up until manufacturers may be paying significantly more for a product, and they pass that cost on to distributors and ultimately consumers.
It is a frustrating and unpredictable time in construction, as it is in many industries dealing with supply chain issues. It is also an exciting time as so many are enthusiastic to improve their homes and bring greater beauty and functionality. There are signs that the situation is improving, but it is impossible to say when supply chains might return to “normal” given the many issues involved. Certainly, present realities create a challenge when predicting the timeline and final cost of a project. At Floor Zone, we pledge to give you all the information we can and to keep you informed as your project progresses. Our professionals can also advise you on choosing products that are more readily available – products with a shorter, simpler supply chain.