When basically the whole world shut down back in March of 2020, no one could have predicted what followed – an unprecedented demand for all things home goods – furniture, remodeling, appliances, lumber, you name it. The increase in demand started ramping up in the summer of 2020, and there is no indication of it slowing down anytime soon.
It was and continues to be a perfect storm. People are at home working, playing, and nesting with their own bubbles, staring at what needs sprucing up, while simultaneously not being able to spend money on their usual pastimes like travel, clothing, events, restaurants, etc. This frees up discretionary funds. An exodus of people from larger cities to the suburbs also created a significant boom in home sales — up 8.7% vs. the year prior*.
When people get tired of their same old four walls, they remodel. When people buy new homes, they also remodel. And when everyone remodels at the same time, demand increases, and prices follow. Shortages of materials and labor and the greatest stimulus package in a lifetime all contributed to what came next – major compromises to the supply chain. Manufacturing, trucking, warehousing, — each step in the chain — struggled to hire as employees and the workforce reshuffled, with many new and untrained workers stepping up to the plate.
Then there was the weather and other acts of nature. Unusual cold in Texas affected the industry’s almost exclusive supplier of “foam” used by all major upholstery companies. Fires in California affected some manufacturers, and ships wedged in the Suez Canal and then waiting their turn to dock in the big ports caused additional issues. It was a whole lot of change and new challenges, all at one of the busiest times in the industry.
Now that we’ve gotten all the bleak news out of the way, what does the future hold?
In a very unofficial (but personal) survey of our vendors and suppliers, the consensus is that labor challenges, material shortages and delays continue to be issues the industry faces. Some material is starting to become more readily available, which is increasing some production volume; however, this also requires an increase in labor and people being more available and sustainable for employment. That said, it could take upward of 6 months or more to completely recover some of the current lead times.
From a manufacturing standpoint, some products are being built to the point of “almost done,” but then shortages or unavailability of parts and pieces required to complete the job create a backlog and more lead time hurdles. Pricing increases that are typically communicated with advance warning are now sometimes immediate and unexpected, resulting in awkward conversations and explanations, as manufacturers struggle to stay ahead of a constantly changing situation.
What does this all mean if you want to order furniture, remodel your kitchen, or do an addition? Well, from all indicators, prices are not going down anytime soon, although some big spikes in building materials have softened as supplies are restocked.
So, what can you expect, and what do I advise for any upcoming home remodels or furnishings purchases you have planned?
The best advice I can offer is go into the process with eyes wide open.
Be as patient as you can and remember the entire industry has been affected. The good news is the industry is strong and is expected to remain strong.
Expect a few bumps, be open to the possibility of last-minute changes and/or delays, and yes, even possibly unexpected price increases.
If you have a certain event or holiday as one of your completion requirements, consider postponing until after your event. Expect and try to embrace the additional time to create the space you’ve been dreaming of.
Try to choose from items that are in stock, and use the relationship with your designer to determine which manufacturer lead times are most favorable.
Choose a team with solid vendor, supplier and contractor relationships (like us) that can be leveraged to get the best results for your project.
And, finally, remember we are all in this together. 🙂 Even if it takes a little longer, getting your dream home will be worth it in the end.