Companies take steps to adapt to material shortages

April 28, 2021

A recent market outlook from Boston-based general contractor Consigli shows construction vendors and subcontractors are relying on technology and off-site fabrication to adapt to material shortages and other challenges posed by the COVID-19 pandemic, according to www.constructiondive.com.

The firm surveyed its partners in markets from New England to the Mid-Atlantic and found the pandemic has motivated subcontractors and vendors to implement technological advancements—such as management software, tool upgrades and robotics—into their shop and field processes.

Respondents said they are prefabricating 20% more than before the pandemic, and 71% of them have noticed an increase in requests for design-assist proposals.

The report noted rising material prices, especially in metals such as copper and steel, and predicted increases for items such as PVC, hard woods and insulation. The reasons for the material price increases include factories not running at capacity after pulling back production in 2020, supply chain delays, tariffs and wildfires.

Consigli reportedly is trying to alleviate the effects of rising material prices by locking in subcontractor pricing as soon as possible to avoid future price escalation; holding contingencies for material escalation in estimates and budgets; and watching for supply chain disruptions from products sourced overseas.

Some owners who want to get back to work are hesitant because they may have to reexamine their projects and budgets considering the rising materials prices.

“Owners are coming back and saying they want to build, but they set their budgets two years ago,” said Diane Mills, secretary and treasurer at Century Mechanical Contractors, Fort Worth, Texas. “What might have cost $100,000 if they started last June is now probably closer to $160,000. So they’re even having to pull back again and rethink what they’re doing, because it’s out of budget.”

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