“Commodity prices always fluctuate, but spikes are difficult to manage when demand is driven by factors that are not the usual ones,” says Johnson, such as renovations and new home starts. to a much higher degree than ever. . “That this increase has now dissipated,” it’s hard to say.

And if the supply chain issues will be resolved next year, “maybe, but no one is going to bet their business on it,” he adds.

“The constraint for project owners who are buying projects and builders who are bidding on projects right now comes from the challenge of bidding on certain construction items on a fixed price basis when there is considerable volatility in the supply chain. supply for these items. “

Neither project owners nor entrepreneurs have much control over current disruptions / shortages in the global supply chain or commodity price volatility. On the one hand, entrepreneurs run the risk of significantly undervaluing a supply risk that they cannot control or mitigate (both in terms of time and cost), but on the other hand, contractors The book may be paying considerably too much for a supply risk that may never materialize, he said.

“Besides delaying projects completely, there are a number of ways to mitigate risk,” notes Johnson. “One is to restructure projects either to remove problematic elements or to reduce the risk of timing they present.”


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