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7 General Contractor Tactics to Keep Projects on Track Despite Material Shortages

An unfinished building on a construction site due to material shortages and delays.

The growing material shortages have caused rising construction prices, project delays, and operational difficulties. General Contractors must adapt to these challenging conditions with the right strategies and tactics to keep their projects on track. 

Key Takeaways:

  • Material shortages have driven up construction costs and caused delays
  • General Contractors must strategize against these factors to keep projects on track
  • “Order materials first, design later” may be the new motto of modern contractors
  • Hiring the right team at the right time is critical in optimizing productivity
  • A combination of flexible contractors and clients with realistic expectations can prevent project problems

The construction industry has seen its share of difficulties in the past year as material shortages continue to drive up prices and delay projects. Many builders hoped 2022 would bring some relief, but that has not been the case. Soaring construction prices, delays in material delivery, and the ripple effect of higher operational costs continue to challenge General Contractors to keep their projects on track.

A 2021 Department of Commerce Report revealed a 15-year high for houses authorized for construction, yet the lack of materials hinders General Contractors from completing projects. With an estimated 5.24 million new homes – an increase of 1.4 million compared to 2019 – required to satisfy current housing demand, General Contractors must be proactive in developing strategies to keep materials in stock, costs in check, and projects on track. 

Read on to discover 7 General Contractor tactics to keep your projects on track despite material shortages.

Factors behind construction material shortages and rising costs

Construction material costs, including lumber, steel, and other building products, have skyrocketed in the past year. The National Association of Home Builders (NAHB) cites that lumber prices have tripled, adding more than $18,600 to the price of a new single-family home. Steel prices are projected to cost over $600 per ton by the end of 2022. The factors behind material shortages and rising costs can be broken down into three main categories:

Global supply chain disruptions 

Like so many other industries, construction has yet to recover from the COVID-19 pandemic, which has caused a standstill in the production, transportation, and delivery of materials. Lockdowns, factory closures, and logistic inefficiencies led to a global shortage of raw materials. 

Post-pandemic, construction projects are gradually resuming. But many economies are investing in massive infrastructure projects to revitalize their economies, leading to competition for materials and higher costs.

Trade wars

The US-China trade war and other geopolitical tensions have disrupted the global supply chain of materials, resulting in shortages and rising prices. The tariffs imposed on Chinese imports have made raw materials more expensive for General Contractors, driving up the costs of construction projects. The Russia-Ukraine war has also destabilized international markets, increasing energy and fuel prices.

General inflation

The IMF forecasts global inflation to rise to 8.8% by the end of 2022, up from 4.7% in 2021. Tightening financial conditions, the cost-of-living crisis, and devalued currencies will further aggravate the cost of construction materials. 

To remain competitive, a General Contractor must strategize against these factors to keep their projects on track. With Redfin projecting a historic decline in available homes for sale in 2022, General Contractors must find ways to manage their materials efficiently, reducing waste and inefficiencies.

7 contractor for construction tactics for optimal operations

Trade tariffs, global supply chain disruptions, and limited materials have brought General Contractors to the brink of economic disaster. Fortunately, there are strategies a General Contractor can employ to minimize disruptions caused by material shortages while keeping costs in check:

1. Be proactive and plan ahead

One often underestimated factor in general contracting is the ability to plan ahead. A General Contractor should closely watch the markets, anticipate trends and price fluctuations, and order materials ahead of the curve. This way, a contractor for construction can build a strong supply chain, ensuring they have enough materials in stock and avoiding disruptions.

2. Establish solid relationships with suppliers

A strong, lasting relationship with a supplier will go a long way in securing materials and staying in the loop with the latest industry trends. You should strive to build long-term relationships with your suppliers and negotiate for bulk discounts, discounts for repeat orders, and priority delivery. Establish trust, transparency, and communication to maximize material availability and ensure supply chain continuity.

3. Order early, design later

This is the new mantra for General Contractors looking to keep projects on track. Since materials are selected to fit the design of each project, a General Contractor should order available materials early and make changes to their design accordingly. 

This will give you enough time to secure materials before they run out while keeping costs low. Racing to find materials when the project is already underway will lead to higher costs and delays in the timeline. 

4. Exercise flexibility in design and get creative with materials

Flexibility and creativity in design can help a General Contractor mitigate scarce materials, volatile prices, and delivery delays. Tweaking the design of a project can help a contractor for construction incorporate locally available materials, reducing the time and money spent on sourcing and transportation. Explore alternative materials and salvaging options and find ways to use materials smarter. Recycle, repurpose, and reuse materials whenever possible. 

5. Invest in technology

Technology has revolutionized the construction industry, from project planning to scheduling, tracking, and inventory management. Logistic systems, cloud-based operations, and warehouse management systems can help you plan your shipments better, optimize inventories, and manage material shortages. You can monitor materials in real-time, move materials quickly and efficiently, and anticipate delays in the supply chain. 

6. Invest in sustainability

Sustainability is no longer a “nice-to-have” – it has become an essential General Contractor practice. Investing in renewable energy, green materials, and sustainable practices can help a contractor for construction cut costs on materials, reduce their environmental footprint, and stay ahead of the competition. Solar energy, recycled materials, energy-efficient designs, and rainwater harvesting systems are cheaper and more sustainable than traditional materials and practices. 

7. Build the right team at the right time

No General Contractor can succeed without the right team in place. Investing in the right team at the right time – from architects, designers, engineers, and construction managers to laborers, suppliers, and subcontractors – will help you execute projects efficiently and on time. 

Getting everyone on board early and assigning tasks efficiently will ensure your team understands the project’s goals, design, budget, expectations, and deliverables. This minimizes cost overruns, delays, and quality issues.

Following these General Contractor tactics will help keep your projects on track despite unabated material shortages, rising costs, and delayed deliveries. Ordering early, exercising flexibility in design, and building relationships with suppliers will position you for success while keeping your projects on time and on budget.  

Hire the right General Contractor for expert project management

Having an experienced General Contractor on board will help you manage projects and materials efficiently, even in the most demanding conditions. RPC General Contractors is a professional construction company committed to offering the highest caliber of General Contractor services – from project planning, designing, budgeting, and scheduling to material selection and coordination of subcontractors. 

We employ a proactive approach to project management, helping you achieve the desired results on time, every time. Contact RPC General Contractors and let us help you successfully manage the project budget and material costs amidst glaring material shortages.


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