Just like shutting off the water source brings out thirst, messing with the supply chain brings out cravings. Ranging from toilet paper to computer chips, the items we once gave little thought to now become highly important.
And just like in those early days of Covid panic when we had to at least give thought to alternative solutions concerning toilet paper, the lasting effects of broken links have caused the word “alternatives” to come back into play – big time.
Thoughtful Alternatives
The three underlying components regarding supply chain issues for construction contractors are:
Materials
Suppliers
Transportation
It is time to consider additional variables concerning sourcing strategies.
Cost of Quality
Lead Times
Logistics Costs
Of course, dealing with various options comes with its own set of difficulties, not the least of which is employee well-being and client satisfaction.
Cost of Quality
Where once the cost of quality meant only the difference in materials and craft, now the actual price of quality includes availability. For example, will a higher cost source prove better in the long run simply because of the time factor?
Lead Times
Just In Time (JIT) deliveries are not as practical as they were in the recent past. Once we advocated for this cash-saving method to protect the bottom line, we’re now moving into a more moderated version. Heck, when your supplier can’t get supplies, things change. If you have space (or can make space,) stocking up on oft-used products or supplies makes sense.
Additionally, long lead times in your planning and orders must be considered. Consider bringing in suppliers earlier in the game. Letting suppliers, including fabricators, know what is needed early will benefit all parties involved.
Logistics Costs
Do your supplies rely on air or rail transportation? Both have recently seen their own logistical problems, sometimes leaving many in the lurch. If necessary and when practical, transporting your materials and supplies may ease the transportation burden.
Whether it means finding more local sources or determining to use sources at a greater distance, the data most beneficial to you will include cost, time, and reliability.
Develop Supply Chain Skills
In the past, the most logistical supply chain knowledge you may have needed was finding the most reliable source at the best cost. Things have changed. Here are a few other skills you will need in today’s broken supply chain reality.
Monitoring supply chain activity
Identifying your construction company’s supply weaknesses
Locating alternative sources or materials
Finding options that you didn’t know about previously
Developing new skills – such as supply chain management
Learning from others – perhaps hiring a supply chain manager
Paying attention to professionals – listen to other contractors and suppliers
Making data-driven improvements
Get to the Supply Chain Point
Take time to review inventory policies and sourcing strategies. Think about the differences in both costs and time benefits. The most glaring consequence of taking measures to deal with the broken supply chain is that construction contractors cannot provide services today at yesterday’s cost.
Reflection: How will you engage in intensified early planning? What innovative or alternative delivery methods will you use? Are there instances when you can use alternative materials?
Construction Contractors look to The Profit Constructors to provide advocacy in dealing with:
Clients and customers
Employees and subcontractors
Vendors and service providers
Governmental entities
Working with The Profit Constructors gives Construction Contractors the means to organize their operations in ways that help them:
Remain informed
Avoid hassles
Reduce risks
Be future-ready
Ready for action? Or want to know more? Get in touch today to schedule a complimentary discovery call. 866-629-7735