In the past seven years I have been at Hartman there have been price increases. But those price increases have been maybe one or two a year. Now, barely 6 months into the year and my file folder – both digital and analog – is overflowing with price increase letters from every supplier on earth. International, regional, national, local. Everyone. The increases have affected every single product that contains the slightest bit of steel, resin, or wood. It’s just crazy. I feel like I am on the “Cliffs of insanity.”
And the hits just keep coming.
It’s no secret – we import fasteners. We have to because, well, there are fasteners that are simply not manufactured in the U.S. The problem now is getting stuff from one place to the other. Ocean freight, LTL, large packages, small packages, carrier pigeons. Ocean or land, carriers are either waiting to be loaded or unloaded. Then there is trying to find someone to actually drive the vehicle. We have waited for weeks to get stuff from ports in NY or MD. At one point I jokingly suggested that we get every Hartman employee to drive to NY, pack their cars with cartons of nails and drive back to the warehouse – we would have our product faster.
And if that wasn’t bad enough…
Are you experiencing labor shortage like we are? Yes, we are coming off a year where millions of people had no choice and could not work. And, in many cases, that has not changed. But even prior to the pandemic it was tough finding workers. Now, it is almost impossible. Our starting wage is well north of the federal minimum. Once you add in the health insurance and matching 401k – that hourly rate is over the $15 hour mark. Still, like so many other businesses, we are very much feeling the impact of being short handed. In addition, many countries are still experiencing the effects of COVID-19 where production has stalled because there are not enough workers.
What will the future hold?
Here’s what I think, but let me qualify everything I write here: I am not some economic wizard, I just read, a lot, so I know enough to be dangerous. My observation is that the supply chain will continue to be constrained until Q2 of 2022. Suppliers and manufacturers have sort of settled in to the mindset of, this is our life right now and we just need to keep putting one foot in front of the other. There are some concerns I have, specifically, I keep hearing the term pricing raw materials; and the cost to ship ocean freight is now the price of an 800 square foot tiny home. However, there seems to be a change in the tone of this supply chain insanity. I would not call it the beginning of the end – more like the beginning of the beginning of the beginning of the end. That all said, I can be confident in one thing as I look into my crystal ball – this will end; we will get through it. If your business culture is like ours, it will be the optimism and the “whatever it takes” attitude and the camaraderie of your employees that will be the thing to carry us all to safer and more stable shores – even if we have to drive ourselves there.