Jun 9 2008 8:53AM | Permalink | Email this | Comments (0) |
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I have been talking with quite a few manufacturers in the past few weeks and the current world oil crisis is hitting home. I am not only talking about the tremendous increase at the pump, but I am also talking about how this situation is affecting the building material manufacturers. Just think about all of the building material products that utilize petroleum-based materials in the manufacturing process – vinyl siding, shingles, windows, fencing, decking, to name a few. The manufacturers who produce these products are getting hit with tremendous raw material price increases and, they are now forced to raise the price of these products to their respective supply channels. All of this means that the builder will pay more and, eventually, the price of new homes will have to increase or the builder will have to eat these cost increases.

This is not a pretty picture but it is reality! I may be a real nut case but I believe this may be a time when the manufacturer, distributor, trade contractor and builder can set down with a clean slate and redefine the supply chain activities to get costs out of the system. Perhaps they can explore new application techniques that take time and costs out of the system. Or how about new distribution strategies or they can define a new product or system that can be cheaper on an installed basis? Who knows what can be accomplished? Maybe I am totally unrealistic but isn’t it worth a try?