Nearly a year into the pandemic, supply chain woes continue to challenge the construction industry. In response, contractors are demonstrating ever more agility.
Material Shortages and High Pricing
In Alabama, a custom home builder reports that lumber framing—for an identically sized home—doubled in the past year, going from $35K to $71K. In California, ships full of materials could not be unloaded because of a COVID-19 outbreak among dock workers. Material prices continue to rise:
Prices of both lumber and steel — two primary building materials — have surged anywhere from 20% to 25% recently….Over the past year, softwood lumber spiked 73%, according to the Producer Price Index….Iron and steel scrap has surged 50.8% in the last 12 months….The price gains are having a ripple effect. Construction observers say costs for drywall, copper, steel studs and even vinyl siding have risen, as well as those for other items that include steel.
Powering Forward: Agility
Determined to build, contractors across the country are doubling down on efforts to communicate more with customers—and suppliers. Better understanding of timing and pricing variables, means better contingencies. Of course contractors are also seizing the opportunity to try new materials in the face of shortages and price increases. For example, Construction Dive reports:
At Grand Rapids, Michigan-based Rockford Construction, one of the 400 largest contractors in the country, director of preconstruction Mike Miner has been scrambling to sub in thermoplastic polyolefin roofing panels on projects where he might have used steel in the past.
“I think a big thing most people underestimate in construction is how nimble we are,” Miner said. “Cost volatility can hamstring projects for a while, but it’s only a matter of time before we find a different solution.”
New Time Frames for Bids
To cope with supply availability and costs, builders are also finding it helpful to reduce the timeframes on bid offers. Here’s how Mike Taylor, CEO of Pompano Beach, Florida-based general contractor, Current Builders, explained for Construction Dive:
“Our quotes and proposals are typically only good for 30 to 45 days now,” Taylor said. “If we know it’s a big project and they’ll take longer for the RFP, we’ll make it 60 days, but we won’t go longer than that.”
Strong Partners: Bidding and Bonding In Real Time
.A leading national provider of surety bonds, Colonial Surety Company is providing a Partnership Account® to help contractors across the country:
- Gain control of bidding and bonding, online and in real time.
- Utilize powers of attorney to seal and issue their own bid bonds—in minutes.
- Compete with fast, confidential bid bonds—no middleman.
- Order performance and payment bonds easily from a customized digital dashboard.
- Track bids and work on hand in real time with free management reports.
- Speak directly with Colonial’s lead underwriter as new opportunities emerge.
- Leverage data on a private Owner’s Dashboard to view surety lines, adjust work on hand, analyze bids—and grow.
Let Colonial Surety Company help you with our unique Partnership Account®. Apply and pre-qualify for a surety-line of credit that will help you grow your business. It’s easy with Colonial’s efficient new online system—and all companies that apply receive, for free, Dun & Bradstreet scores.
Contractors who pre-qualify for a surety line of credit, go on to upload a few more documents that help Colonial better understand their operation and underwrite the Partnership Account®.
Founded in 1930, Colonial Surety Company is a leading direct seller and writer of surety bonds and insurance products across the USA. Colonial is rated “A Excellent” by A.M. Best Company and U.S. Treasury listed.