Hoarding, Cost Increases, and Risk; OH MY!

Posted on | by Bob Ritter

Remember when the pandemic hit, and everybody collected toilet paper? It’s happening today with subcontractors and vendors throughout the trades (not TP; material like rigid insulation, ductile iron pipe, copper pipe, drywall, lumber, metal studs, coiled steel, etc., etc.). Material price surges, a continuing supply chain roller coaster, and the omicron variant have us all guessing how long to receive and how much material will cost when it is finally installed on the job site. An extended construction duration and price increase pass through are deal breakers for us at The Douglas Company, so we are tested to come up with alternate methods to deal with the aforementioned challenges.

Our advanced procurement of construction materials and equipment soon after a contract is executed and well before the equipment or material is needed, is a sensible practice which assures that specified materials and equipment are available for installation or use in accordance...

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The Current Supply Chain Environment

Posted on | by Bob Ritter

The disruptions and unpredictability of the current supply chain environment have been well documented, and unfortunately, the forecast is that these disruptions will remain with us for the foreseeable future.  While there is no silver bullet to insulate a construction project from the potential impacts, strategies can be deployed to mitigate delays caused by this problematic supply chain market.  For these strategies to be effective, though, they need to be planned early in preconstruction.

Your General Contractor should be surveying material and equipment lead times during the preconstruction process so the entire development team understands the risks and a plan to deal with them can be formulated.  One way to build around the excessive and unprecedented long lead times the industry is currently facing is to procure the materials and equipment subject to excessive long lead times earlier than typical, even before execution of the construction contract.  This will ensure...

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Supply Chain Disruptions Continue

Posted on | by Bob Ritter

As most people have experienced in the country, certain materials are tough to come by, whether in a personal or business realm. This is not a new development, but the scale of the issue has seemingly grown, and new challenges are presented in our industry every day. Some may ask, what is driving this? One of the primary factors driving this is a lot of the raw materials that we utilize come from overseas. In an article I read the other day, a record 65 ships were sitting in the ports along the West coast waiting to be unloaded, compounding an already challenging logistics industry. This is causing a lot of uncertainty for suppliers when these raw materials will be received to produce the needed components to build our projects. In the interim, demand continues to increase, resulting in the challenges upon us today.

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Supply Chain Issues – The Impact on Construction Projects

Posted on | by Bob Ritter

Government regulations have been loosening up lately, but some impacts resulting from them are increasing as construction keeps moving forward. One specific item that comes to mind is material lead times. Items that we were accustomed to being readily available now seem to carry a 2-3 week lead time, and items that were normally 4-5 weeks have jumped to 10-12 weeks. If anyone has tried to buy any furniture or appliances for your home lately, I am sure you can attest to that. This creates unique challenges for our project teams to overcome, but our company processes have been developed to help mitigate these issues for our clients and us.

Purchasing materials early is the essential first step, but that is just the beginning. We have come to learn in the past 18 months that there is a lot of uncertainty in the supply chain industry due to constraints of...

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