There is a lot of home building material shortages that affect the construction delays right now with the pandemic. The shortages are the effects of supply chain constraints, high prices of construction materials and, and not enough construction workers to work because of covid protocols. We all know how crucial this is as, in construction, every project has a timetable to follow. As a matter of fact, the contractors and homeowners really take time to sit down and discuss thoroughly every schedule of the process. It has a start date and an end date this is why the construction industry has been in a struggling phase during this time.
You might be thinking this can have a huge impact. Yes, definitely, the whole construction industry will suffer if this pushes longer. Leaders of countries have been trying their best to lessen the impact to the economy. However, covid is a deadly virus that may have to require a lot of time to be solved. So what can we do during this period? What can we do during construction delays? Can we really cope up? If these are your questions, then you’ve come to the right place! We will be discussing this in order to help everyone who is experiencing construction delays!
What we can do during construction delays?
Luckily, there are few things you can do to thrive even when there is a pandemic. Knowing how to deal with the construction impacts due to COVID-19 is going to help you as we weather this period. During this unexpected global pandemic, contractors like you and your sureties will surely face familiar challenges. Stiffer problems will occur so the first thing you need to learn is to have patience. The majority will experience material shortages and labor inefficiency. You will need to consider plenty of solutions that may not be good in order to navigate the inevitable contractor failures. Expect these things as it will arise no matter how hard you try to avoid them.
You need to understand as well that your contract performance has obligations and delay clauses. Since there is a required “time” for every step, there is a responsibility to complete the project before the deadline. However, being absent because of a pandemic is a justifiable excuse. People will understand this because we all suffer from a pandemic. Though, you must also keep in mind that the consequences for failure to meet the deadline may include termination of the contract. You need to be ready for this as this is not a surprising move because payment and costs for the labor force to mitigate delays, damages, or actual delay damages for not being able to timely complete the work will surely be hard to bear for them.
What is best to do is to discuss the problem with the homeowner. Suspension of work and termination for convenience clauses can be your option. Rather than deal with the cost of project delays because of COVID19’s impacts, you may just suspend the work on a bonded project until the struggling phase has been passed. You may also need to discuss with your clients about the options like insurance coverage and disaster loan programs. Do not hesitate to ask for help from experts regarding the subject matter. You will surely need it as these times are going to be really hard on both parties.
Causes of shortage and delay in material supply
Since there is a pandemic, it will be hard to do construction all over the world. It has been hard for the vast majority to thrive on their work. It is truly a struggle to work on a project when almost all of the materials needed are running out before a task is complete. Even though sometimes, there are materials that can be quickly obtained from a nearby store, we can still experience interrupted work as workers stand idle while the material is being procured. It is why construction is increasing its price.
In some cases, the material may not be readily available. It is hard to continue working as it could take several days to get the items and start working. As a result, there are additional costs and delays in the construction industry. There are many reasons for material shortages but the main reason is that there is a shortage of labor. You may expect a higher increase when it comes to materials and workers as there are so many covid restrictions happening right now. Perhaps, it is best to pause your construction business for a while or if you really want to continue working, it is best to have your workers get vaccinated. It will ensure your clients that they are safe to work with. However, the prices will most likely be more expensive as the world is experiencing a tough time.
What to Know About Building Materials Shortages & Delays
If you have an existing construction contract, it is better to check with your clients if they want to pause or comply with the expenses. If you have already entered fixed-price contracts, the aforenoted conditions may be different from envisaged at the time your contract was sealed. This change could add significant stress as there are shortages that cause on-site delays and disruption to projects. You will definitely experience financial risk as it will lead to exposure to liquidated damages and delay costs because of the pandemic.
There are also additional consequential costs and this includes paying the extended site preliminaries. These are risks that may not have initially been factored into the contract price so it is best to discuss this to compensate for the losses. It is advisable to check your contracts as there are clauses and ascertain whether there is entitlement in case there is a price increase. For new contracts, you should consider the inclusion of these clauses and talk it through in order for both parties to pursue the project without hesitations or dissatisfaction.
It is required to negotiate new agreements, so please be really conscious about the current supply and pricing issues. It is highly essential that both of you are aware of the situation, and ensure that the prospective contract adequately captures the risk allocation as delays or cost increases are truly inevitable. In addition, negotiating contracts must also have prospective contractual terms in case there are delays and losses arising from material shortages because of Covid-19. If not adequately captured, the benefit of introducing clauses will set out the risk allocation so you may consider this.
You can also discuss your entitlement to an extension of time as the schedule of the project will be affected. If your construction business has already entered a contract and is delayed due to the impact of Covid-19 or shortage of material supply, the right thing to do is to check the contract terms to ascertain the entitlement and additional time for delays like these. Where permissible, the delay should be notified as soon as possible to apply the extension of time. You must know that you are also entitled to claim for the financial loss and expense so that you can be compensated according to the situation. Keep in mind that you must document the actual delay and costs as proof.
Feeling the Impact of Building Material Shortages?
You need to understand that these are our trying times. There are a lot of changes in the construction industry because of the COVID-19 pandemic. Unfortunately, many of these changes have a negative impact on us. You need to accept this and learn the best way to cope. Building new homes and commercial buildings might need you to consider an alternative to traditional construction. Do not hesitate to work on your options.
Modular construction is also a good alternative for everybody. You can try using different materials or even using them differently will be a good step. You may also increase construction speed and reduce labor costs as this is more affordable in general. By doing modular construction, you may find a solution or answer to a building materials shortage. A lot of experts are pertaining that 2021 would be the year of modular construction, and we should take this new chapter so we can grow and thrive together. Be ready to take on the challenge and win over these unprecedented difficulties. Together, anything is possible!