Potential Effects of Delaying Capital Projects
Over the last six months, the leadership team at NV Roofing has remained in direct contact with manufacturers and distributors regarding the impacts of COVID-19. The overwhelming concern is the potential demand coming out of the “slow down” period and the direct effect on increasing material costs.
Additionally, labor is also expected to be in high demand, thus the time to complete projects is expected to increase as a result. There are many reasons for the increase in materials and labor, we have summarized them below for you:
- Distributors are slowing material orders due to uncertainty in the market.
- Manufacturers have slowed production of roofing/siding materials due to the Covid-19 protocols put in place by state Governors. The three main roofing manufacturing plants that service the region have limited production of shingles and other roofing materials.
- Materials being produced are being sent to markets where severe weather has caused significant damage.
- The anticipated labor shortage is in part due to crews relocating to alternate severe weather markets where work “must” be completed sooner.
- Post Covid-19 “project rush” will create a backlog of projects to be completed.
- Labor rates increased 20-25% during the wind storm the region experienced in 2018; we are expecting similar increases due to the anticipated demand as a result of scheduling delays.
- Historical data from manufacturers show us that 7%-12% annual material price increases are expected as we transition back to traditional business.
How to Safely Complete Projects Now and Avoid Potential Cost Increases
- If your organization is able to approve work now and pay deposits you can lock-in current pricing.
- Schedule your work now to secure your “place in line” and minimize project delays.
- Ensure your contractor has developed and adheres to COVID-19 on-site safety protocol.
If you have any questions, NV Roofing is here to assist. We will continue to maintain close communication with manufacturers and distributors in order to keep you up to date. Our goal I to provide clarity – to the extent possible – so that you can make informed decisions.