Material Woes: Navigating the Current Supply Chain Challenges

By Craig Carson

Are you facing material supply issues? Most of us are and it brings on even
greater challenges when bidding and managing projects. What are you doing to protect yourself and your customers?

What Happens to Supplies?

We have seen historic increases in glass pricing from the float and fabricated glass suppliers. Some of this is due to the increase in demand for natural gas caused by the slower than usual return of drilling from the slowdown of pre-pandemic levels. The same is true for the oil recovery, which affects gas and diesel production.

The bottom line is it costs more to produce and more to transport. Add to this the need for heating oil in much of the country and supplies will drop even further. This situation will improve once the oil and gas industry can get back to pre-pandemic levels and then some. On top of this, the government has implemented new policies that have restricted development on pipelines and they’re even discussing shutting some down.

This means glass fabricators are holding the terms of their quotes to 30 days. This is usually the case, but when the market is more stable, so is their ability to hold their pricing. Now we are seeing that after 30 days, they want to review and adjust the pricing to market conditions to their costs. Additionally, I’ve seen conditions where the material must be shipped within a 12-month period. This will be acceptable for most projects, but if you’re working on a project where the material delivery is outside of that window it does leave you between a rock and a hard place.

Be Aware of the Impact

We have also seen cost increases on aluminum. There seems to be more confidence that the aluminum market may be steadier than the glass market going into next year. One of the concerns I’ve heard is that extruders have increased delivery dates between 30 to 42 weeks.

This means that your estimators need to be aware of the impact the available supply chain for materials is having. They need to reflect real-world conditions to keep customers better informed during bidding and closing. Your project managers also need to review project schedules carefully and set milestones for when approved submittals and shop drawings are needed so you can order materials.

This is all challenging and needs your attention, now more than ever. As I’ve said before, the devil is in the details, and that’s never truer than it is today.

Craig Carson is the vice president and general manager of 8G Solutions in Denver.

To view the laid-in version of this article in our digital edition, CLICK HERE.