China is currently the world’s largest exporter of construction supply. However, while the economic giant is starting to regain from its recent recession, the impact on the construction supply sector is just beginning to become noticeable. One of the less noticed consequences of this trend is the impending potential shortage of construction supply. This is particularly alarming in light of the relatively recent global credit crunch that has gripped the construction industry in recent years. The potential crunch will inevitably affect construction spending, and consequently, could potentially lead to a contraction in construction activity around the globe.
Potential Reduction of Construction Supply
One of the ways that you can deal with the potential reduction of construction supply at your job site is by obtaining pre-bid estimates for any construction supply that you require before your project begins. This will help you better prepare for the future needs that you may have when it comes to finding and buying materials. In addition, pre-bid estimates can help ensure that you have adequate quantities of the basic building materials that you need to begin your project.
How you manage your project’s supply chain will also play a significant role in determining whether your construction industry remains in operation in the long term. The construction industry is made up of many different entities. For example, there are the contractors that you employ to complete your project and the subcontractors that you work with to obtain the building materials that you need. Likewise, there are transportation companies that will bring the raw materials to your project site, and there are other employees that will oversee the construction process as well.
You Should Be Aware That Wholesale Rates
Without these various entities, your construction projects would grind to a halt. One way that you can ensure that you have a steady supply of building materials is to ensure that you are purchasing them in large bulk quantities. If you are a contractor, you can often purchase these building supplies in bulk from wholesale construction supply companies. However, you should be aware that wholesale rates do not always reflect retail prices. Be sure that you are comparing apples to apples so that you are truly comparing like items.
While it may seem that the construction supply that you need to keep your construction business operating can be purchased at wholesale prices, you should consider that construction vehicles are not sold wholesale. Instead, heavy-duty equipment is typically sold to construction company owners on what is known as a lease-to-own basis. If your construction company uses heavy-duty equipment on a regular basis, you should consider purchasing these materials in bulk quantity so that you do not need to constantly purchase new construction supply just to keep your business running.
Understand How Your Own Construction Supply Chain Works
Although it may seem that your construction supply sources can provide you with everything that you need, it is also vital that you understand how your own construction supply chain works. For example, if you purchase supplies from a wholesaler, you must pay a significant amount of mark-ups for the products that you receive. This is because wholesalers do not pass on the additional costs associated with their manufacturing process. On the other hand, if you work with a distributor, you will receive your construction materials at a low enough price so that you can begin construction projects immediately. Wholesalers cannot afford to sell items at wholesale prices; therefore they pass on some of their cost and hope that you will take advantage of it. A distributor will not be interested in paying too much for a construction material, especially one that is vital to the successful completion of your project.
Another way to save money when buying construction supply and materials is to purchase materials that require a construction permit. Construction projects that require a permit include, but are not limited to, bridges, parking structures, swimming pools, garages, storage buildings, structures that are used for industrial production and various other types of projects that are considered to be “heavy duty.” Although there may be some difficulty obtaining construction permits from local government agencies, if your project is deemed to be something that requires a construction permit, you may be required to pay a minimal fee, or pay an administrative penalty, in order to procure the construction permit. While these fees can seem steep, they will be worth it in the long run as these permits will ensure that your construction project is done according to local guidelines and construction laws.
Cut Down on Construction Costs
One more way to cut down on construction costs is to buy the materials in bulk, especially if your project requires several construction phases. If you purchase all of your construction supply in bulk, you will be able to reduce the cost per unit by as much as 50%. In addition to saving money, if you purchase construction supply in bulk you will have all of your supplies at one location, eliminating the need to store construction materials at several different locations throughout your home. Many wholesalers now offer construction project packages that include everything that you need to build your home including lumber, cement, steel, insulation, windows and doors, among many others, all at one convenient location.