Things got kooky in my world last year, and they continue to be, well, interesting (I guess that is one word you could use – this is a family blog after all) this year. A few random notes for those who may be interested. For those who may not know, I own an HVAC distributor, which is a subset of industrial distribution.
We recently received an increase of 15% in sheet metal fittings. The manufacturer just announced that due to continued pressure on steel, there will be another 15-20% increase coming in 60 days.
This news about sheet metal fittings dovetails into some interesting news I have been hearing about new construction. Lumber and other materials are skyrocketing so fast that builders are going back to people who are building houses and redrawing up contracts and demanding more money. Banks aren’t appreciative. It’s ugly.
Cans are in short supply. We sell a boatload of aerosol based cleaners for everything from commercial cooking equipment to air conditioners to refrigeration coils – I have heard that there are problems in aluminum, and cans themselves as the sanitization industry is taking up much of the can consumption for cleaners and germicides.
One of the major HVAC equipment manufacturers that we represent announced a mid year price increase. I can only remember one other time this happened. It is rumored to be in the 8% range.
An ice machine manufacturer just announced a 10% price increase, then another 20% on top of that one month later.
There is a force majeure on one of the components that is used to make foam in a can – I think this is from the damage in Texas that was caused by the cold snap but I am not sure. This affects a lot of markets. I have heard that a refrigerator manufacturer is getting ready to idle production because they can’t get foam.
Industrial distribution is on allocation for PVC pipe and fittings.
Shipping woes worldwide continue. The Suez Canal thing didn’t help. Shipping costs are triple what they were last year.
I am getting daily bulletins from all of our vendors with these types of things. With copper, steel, plastics, silver and chemicals all having problems right now and at record prices, it is going to be another interesting year, to say the least.