Navigating the Global Supply Shortage: A Colorado Perspective

The mantra: manage expectations and have patience. We will get it done.

Since the beginning of the pandemic, every few months we’ve updated our clients and the community of what to expect when embarking upon a home remodel in Colorado Springs. It’s an interesting moment in history if you’re on the outside looking in, and downright frustrating if you’re in the middle of it. The biggest takeaway that we want to convey to people thinking about a renovation is that we can get it done. However, having a flexible schedule and being open-minded when choosing products and materials is key.

I think it’s important to explain what is happening from a larger, international scale, and then bring things closer to home here in Colorado. Without a doubt, you’ve all experience shortages and supply chain issues in other areas of your life. It’s impossible to turn on the news without mention of it. It’s a serious and widespread issue, and one I think we’ll be adapting to for the foreseeable future.

In 2020, we saw lumber prices skyrocket. It was insane – truly something we’ve never experienced. Prices would literally change overnight, blowing away budgets for people who happened to have the misfortune of being in the middle of a project. Almost all quotes were wrong as 30% increases were common during a 24-hour period. We did an entire article on this, but briefly, it was because housing demand – especially new builds – were at a historic high and sawmill and lumber production was shut down due to COVID-19. Thankfully, we’ve recovered from some of this. The price of lumber is still higher than 2019, but not nearly at the peak levels we saw in 2020. Demand for housing is still incredibly high, but sawmills are no longer shut down… kinda.

The scenario I’m going to outline for lumber production can basically be carried over to any material – tile, sheetrock, gasoline, Thanksgiving turkeys, etc. – and generally affects all facets of current business. Production is no longer stopped due to COVID-19, however, staffing the plants and production facilities is incredibly difficult. With the instability, many people were laid off or paid by the government to stay at home – since these programs have ended, workers simply aren’t returning to work. It sort of seems like everyone collectedly stopped during the pandemic, revaluated their life, and said that the old model was no longer working. They now want a livable wage, benefits, time with their family, and not be told what must or must not be put in their bodies. This labor dispute leads to less lumber (or anything else) being produced.

The worker grievances outlined above directly impacted the transportation industry the most. If even a small percentage of truckers decide not to return to work, the ripple effect is catastrophic – which is what we’re experiencing now. Not as many containers get moved, distribution centers get overloaded – and this congestion reaches all the way back to the ports where ships sit off of our shores unable to unload their goods. These ships get backed up and can’t make as many crossing, and manufactures overseas have to slow down production because they can’t store or ship the new products being made. Logistically, we’re stuck in the mud.

Now, there’s second situation playing out at the same time as the worker and transportation shortage. Because the functionality of our economy is so heavily reliant upon importation – and imported goods are almost at a stand-still – the chips, microprocessors, and parts that keep our production plants, distribution facilities, and trucks operating cannot get to where they are needed.

For instance, a machine at a large sawmill breaks down. The part to fix it most likely comes from China, and that ship is currently stuck offshore waiting to unload its goods. Further, trucks break down each and everyday. The parts needed to fix and maintain these trucks come from overseas. Those parts can’t get to the broken trucks because there’s not enough trucks to distribute the goods from unloaded ships – in the meantime, more trucks breakdown, more drywall plants breakdown, more concrete plants breakdown – the parts needed to fix these trucks and plants come from overseas… and so on. See the vicious cycle? It’s a cascading affect that is making it very difficult to get any imported materials or products, and these products are needed to keep things moving.

So, What Does This Mean For Colorado Springs?

The housing market in Colorado is still extremely hot. Demand for housing, new and old, are still at all time highs. This means the material our state and community needs to meet the demand is also at an all-time high. Locally, we’re faced with labor shortages as well. As you’ve seen, restaurants are severely under-staffed and prices for labor are rising.

This is also true for skilled labor and our trade partners. Here at Alpine Contracting, we’re dancing on a doubled-edged sword. We’re so grateful – we’ve never been busier, we’ve never had more work in our entire lives – however, we’re weeks behind being able to serve new clients. We have to make it explicitly clear when providing quotes and free estimates that we are several, sometimes many, weeks out before we’ll be able to begin their project. Again, there’s just not enough people to do all of the work that needs to be done.

Further, it’s a very difficult time to source materials if you’re a dead-set, particular person. If you’ve dreamt of marble from the Himalayas to finish your new entry, you’ll most likely be waiting a very, very long time for the order to be filled and also paying exponentially more to get it here than two years ago. However, if you’re flexible, and Michigan marble works just fine for you, it’s okay to expect standard delivery times and modest shipping and installation increases.

Again, particular appliances are very difficult to guarantee at the moment. If you’re willing to accept what is in stock at regional distributors, there’s virtually no delay or price increase. However, if there is a particular model that you must have – you could be waiting indefinitely.

Conclusion

I understand what I’ve outlined above appears bleak on the surface. Rest assured, any and all remodels and renovations can and will get completed – and they will still drop your jaw. We refuse to sacrifice quality or workmanship, but we also want to be honest with you. Pad your build schedule with a little extra time. We can still get things if you’re openminded. If you’re flexible and eclectic with your products and materials – choosing items that are currently in stock – you’ll breeze through the process like there’s no global supply shortage happening at all.

The better we inform you, having a tough and honest conversation about the state of the industry, the better decisions you can make and the happier you’ll be. We respect your time and intelligence, we know that you can handle reality, and we look forward to building the home of your dreams. Reach out today – let’s get started.