June 24th, 2021
Stressed Supply Chains
Having been in the window industry for almost 30 years, there was one department I always found to be quiet, unassuming and reliable: the supply chain and purchasing department. They just went about their duties, did their jobs and “stuff” always showed up on time. Sure, there was an occasional blip, but 99% of the time, I always left them alone to successfully play in their “complex fiefdoms.”
Fast forward to today and the supply chain and purchasing departments are at the forefront of our businesses and our industry. They’re doing whatever possible to make sure raw materials are in house for manufacturing and for customers. Purchasing departments are buying as much material as they can. They’re looking at alternative suppliers, and having to make tough choices about product offerings.
I, for one, commend the supply chain teams for doing everything they can to keep the flow of material coming on a consistent basis. We have taken them for granted for a long time, as things just showed up when they were supposed to.
With supply and demand, price increases happen. Hopefully, as things level out, these increases will start to subside. We are already seeing this happen with lumber as it came down 20% this past week alone.
From talking to many supply chain managers, I think we are in for a bumpy ride through the end of the year. However, things should start to level out toward the end of the year and there is hope that we will see some normalcy in the first quarter of 2022.
As the economy continues to come back online, many forecasters are predicting another year of growth in 2022. I think we are all seeing the same and as demand has increased, so has our ingenuity on how to supply our customers on a timely basis.
To close, honesty is the best policy here. As lead times continue to stay unusually long, it is important to continue communicating with our customers and set realistic expectations. As our suppliers continue to ramp up, lead times will work themselves out and we will again enjoy some normalcy!
Great Selling!
Ty
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Well said, Ty. 2021 is unlike anything I’ve seen before. Additionally, I think it’s safe to say that the farther from raw materials you are, the less understanding you are likely to be. Fun times.