Electrical contractors need to prepare for supply shortages and price spikes

Power supply chain disruptions

Power supply chain disruptions

Solutions for electrical contractors to prepare for and deal with impending supply shortages and price increases.

IRVINE, CA, USA, October 20, 2021 /EINPresswire.com/ – Electrical contractors should prepare for continued price increases, spikes in demand and longer lead times amid pandemic supply shortages. Raiven, a leader purchasing and procurement platform for entrepreneurs and property managers, presents data and proposes solutions.

DISTURBANCES IN THE ELECTRICAL SUPPLY CHAIN

According to power supply chain research published by Raiven, the prices of various raw materials like copper and steel doubled between 2020 and 2021. This echoes the downstream price increases seen in finished electrical supplies. The trend is also valid for specialty materials – polyvinyl chloride used in the production of PVC conduit has increased from $ 5,480 / tonne in April 2020 to $ 9,570 / tonne in August 2021. At the same time, its production fell more than 50%, further price increases.

Similar situations can be traced across all manufacturing sectors, leading to supply chain disruptions. Electrical contractors already face challenges in sourcing certain items at an acceptable price, from basic wiring and lighting products to generators, electric vehicle charging stations, and more.

SUPPLY SHORTAGES ARE EXPECTED TO CONTINUE

Raiven’s data related to shortages shows a variety of factors impacting the power supply chain, including:

• Labor shortages – The COVID-19 pandemic has wiped out 8.8% of all working hours worldwide. This significantly affected the manufacturing sector and led to a drop in production. In addition, with the market already short of qualified electricians, demand continues to exceed the supply of labor and materials.
• Economic challenges – There is an increase in the demand for supply, but the industry cannot keep up due to labor issues and raw material prices. As a result, supplier delivery times are at their highest level since 1987, often taking months to fulfill orders.
• Logistics bottlenecks – All major methods of transportation experienced delays on arrival – shipping, trucking and air freight suffered greatly during the pandemic. In particular, international maritime transport recorded a 20.8% drop in port calls in 2020, from which the economy has still not recovered.

As these factors began to ease in mid-2021, new challenges were introduced by the COVID-19 Delta variant and natural disasters. Prices for electrical supplies are likely to continue to rise in the short to medium term.

WHAT ELECTRICITY CONTRACTORS CAN DO TO SECURE SUPPLY

When Raiven started to research Power supply chain disruptions, company CEO Brett Knox pointed out that distributors have varying levels of price sophistication. Some of them are proactive and raise prices ahead of the curve, while others may be months behind the market. How do you deal with these difficult times?

Brett Knox, CEO of Raiven, describes how group purchasing and technological advancements can help entrepreneurs save time and money in these situations: “First, entrepreneurs and property managers need to join a purchasing program in order to to leverage the combined purchasing power of their fellow members. This ensures lower prices and a higher priority on hard to find products. Brett continues, “Second, technology is now available that searches real-time distributors to find product availability and current prices. This can save a tremendous amount of time and money because you let the technology do all the work. No one wants their employees to waste hours calling distributors or searching the Internet for product availability.

As supply shortages persist, electrical contractors who leverage the relationships and technology of strategic distributors will not only be more profitable, but will also have happier customers.

ABOUT RAVEN

Raiven is a leading buying platform, allowing entrepreneurs and property managers to save 7-25% on their daily purchases. Raiven’s cloud-based sourcing platform helps businesses source and buy smarter and more efficiently with patent-pending AI algorithms and a buying program that offers discounts important from the main suppliers in the sector. Learn more at Raiven.com.

Jeff Golden
Raiven
+1 503-709-0286
[email protected]


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Patricia D. Rutt