In case you haven't noticed, what's emerging in the post-pandemic economy is becoming a bumpy roller coaster ride. It’s increasingly clear that the new economy is not going to look the same as the one we knew before Covid-19.
How The New Economy Is Panning Out
I've been reading information in the news about "the new norm" of the post-pandemic economy. From the supply side of our industry I can attest to the truthfulness of what the articles are saying. It's on! We're starting to experience the impact on all levels of the supply chain. And these conditions will affect your business as some items that you need might not be available or they may cost more to acquire.
The pandemic has affected some parts of the economy more than others. Some sectors have seen strong growth. Some sectors have just managed to get by. Other segments have suffered. Sadly, some have gone out of business. And even with vaccination efforts and declining coronavirus cases, the economy is still in a precarious condition.
Federal reserve chair Jerome H Powell acknowledged “This is an extraordinarily unusual time. And we really don’t have a template or any experience of a situation like this. We have to be humble about our ability to understand the data."
The Overall Effect
The housing market and construction costs have exploded. Inflation has risen to a 13-year high. The workforce has shifted. In many cases it’s becoming nearly impossible to find adequate help.
Unprecedented online ordering has changed the dynamics of commerce. Freight and small package deliveries are now moving items through their network at a rate that’s well beyond their limits. As a result, shipping and transit times are taking longer than expected.
Many products are becoming increasingly hard to obtain. Products from Europe and Asia are coming into the country at a trickle… more like a drip. Some items are becoming nearly impossible to obtain. In some cases, customers are now willing to accept a lesser product, just being happy to get anything at all.
In the workforce, employees too are demanding more pay and better work conditions. There is also a shortage of reliable help that can be found. This too is negatively impacting small businesses (like those of us in the cleaning and restoration industry).
Within The Carpet Cleaning Industry
Sales Are Steady
As we work with carpet cleaners across the country we're seeing that business is good. Carpet cleaning revenue in most parts of the country is generally strong at the present time. In fact, historically the carpet cleaning industry has weathered the fluctuations in the economy. During the past 35+ years that I've been in this industry I've observed that commercial cleaning keeps humming along, regardless of what happens on Wall Street. And at this point in time, it looks like carpet cleaning has clicked back and is doing well.
Emerging Backlogs In The Supply Chain
However there are increasing supply issues. The constraints of products moving into the country is slowing the availability of some equipment. Some machines are now requiring "pre-ordering", with orders being shipped as the machines become available.
There's also an emerging shortage of raw ingredients that are used to manufacture our cleaning products. The hard freeze in Texas in February that halted the petroleum pipeline has now rippled through the chemical industry. Keep in mind, many raw ingredients are made with petroleum derivatives. Some necessary raws are presently unobtainable.
This translates to extended lead times on products coming in. Some items are simply not currently available. Price increases from our vendors have been rolling out steadily.
Outbound shipments are moving slower than expected. And all of the shipping carriers have raised their rates across the board, resulting in higher shipping costs for our customers.
What All of This Means For You And Me
Although carpet cleaning revenue across the country is on par, it looks like we’re now in for some supply hurdles. For the cleaning industry specifically; we can expect increasing delays in the availability of equipment, chemicals, etc. We're also already seeing scarcity of some products. And costs are creeping up on many items.
It appears that Jerome Powell was on point when he said… “This is an extraordinarily unusual time.” Unusual indeed!
We are all going to need to adjust to what's looking like "the new norm". No doubt you're already coming to terms with the fact that the supply chain is faltering. Frankly, there's not much any of us can do about it. So we'll all need to adjust our expectations. Even though we may be coming out of the pandemic, new business challenges are arising.
What We're Doing At Excellent Supply
First of all - thank you! Thank you for being one of our highly valued customers. We will continue do all we can to support you as we ride this roller coaster together. We're working hard to source the things you need for your carpet cleaning business. Thank you for being understanding and patience when it comes to some unexpected delays and possible shortages. Be assured we will do everything in our power to help you keep the wheels turning (after all; your success is our success too).
In closing... Hang on tight; this bumpy roller coaster is still in motion. We'll all have to wait and see how this plays out - till the ride comes to a stop and we can exit safely. For now, as entrepreneurs, try to remain patient, resourceful, resilient. After all, isn't that what successful entrepreneurs do best!
From Your Friends At Excellent Supply