It has become my goal to turn out a “company family letter” each season. Over the past few weeks, I found myself thoughtfully considering what I wanted to say this time around. I always want to be sincere and rightfully inspire the positivity that I feel about the future to all of you whenever I communicate. But it needs to be said; I want to address the elephant in the room!
As part of my role in the organization, I frequent social media conversations pertaining to our industry to keep my finger on the pulse of questions homeowners are asking, so we may prepare our team responsibly for their interactions with you, the people we work to please.
Because we are truly in partnership when you hire us to complete a home remodeling project, there is a saying from our training coach that says, “We must do everything we can to make our clients the best clients they can be.” In part, what that means is we must give you, the homeowner, clear and realistic expectations so that the remodeling process becomes predictable, our communication is smooth, and the project experience is as easy as possible.
As I peruse the many online conversations about what is going on “in the building industry”; I notice how many misconceptions there are. So, I decided in this letter I am going to let you know everything we know. In the last letter, I shared what happened with the extreme snap-back we experienced last summer and fall when Covid shifted gears and people decided they were in their homes for the long haul. Well, here we are a few months later, same crisis, different season.
An Industry on Its Toes
On several fronts, and attributable to Covid19, the remodeling industry is currently experiencing a perfect storm of sorts. It really comes down to three things. 1. Demand. 2. Manufacturing. 3. Labor. Not necessarily in that order.
Lakewood IL Master Bath Renovation
Demand:
2021 is indeed becoming the “Year of the Home” that I predicted in January, and as you will see in the Peloton story in the video I am about to mention. In ways no one ever imagined. Not only are manufacturers and shippers completely overloaded by record online purchasing of consumer products like exercise equipment, office furniture, and every household item we could ever need to “live and work at home”; but requests for home renovation projects both large and small have skyrocketed. We have since experienced a record-smashing first quarter unlike any we have seen before. Every economic indicator we follow suggests this trend will continue for an extended period. While a strong market is a blessing, on the one hand, it has created challenges on the other.
Anyone worth their weight in salt in the remodeling industry is booked out for months. Despite the demand, all our projects will continue to experience “Common Sense Remodeling”; a careful step-by-step process that begins with cost analysis and design and completes with a carefully executed project plan, as we always have. We are putting projects on our field calendar as soon as possible – as we receive confirmation of permitting and confirmation of shipping dates for product in the order they come in. This is the most expeditious way we can accurately predict start dates for projects at this time.
Manufacturing:
Manufacturers still have not caught up from the fall, and this spring the surge of new renovation demands are just adding to the pressure to turn out product to meet the demand. This is resulting in longer lead times, as well as increased shipping and production costs.
One of our suppliers sent me this fantastic video, which provides an eye-opening look into what is really going on out there. It is well worth the 5:45 min viewing time; I have watched it several times myself! I highly encourage you to check it out to understand why and when we might see some relief.
How L.A.’s Container Ship Logjam Highlights Larger Pandemic Supply-Chain Issues
Labor:
In 2022 we will be entering our 30th year in business. In all the years we have run this company, we have never experienced a more difficult time hiring great people with established skills until now. Post 2008 recession, many skilled laborers left the trades, and as our industry slowly recovered years later, many of them never came back. Today there is not an overabundance of skilled tradespeople out there. Young people are not entering the construction trades as they have in years past, as our culture seems to be encouraging many to forgo good-paying blue-collar jobs for a “more useful” college degree. This goes not only for skilled carpentry but also to plumbers, electricians, and all the skilled trades it takes to perform a well-done home renovation project effectively.
And more recently and as shown in the video above, present labor shortages in the shipping and manufacturing industry, including truck drivers and related transportation, have created further delays in product receipt, impacting nearly every product we order. As long as our government continues passing out relief benefits and incentivizing people to stay home, many are not motivated to go back to work.
Grinding it Out…
So, I am not going to lie. We are busy. We are a bit stressed (Are not we always, though? – our team does a tough job!). But we at Advance Design are grinding it out. The first thing I can tell you is this; every project we do matters to us. Every project is getting the attention it needs to go through the design process and into the field with the same careful regard that it has for the nearly 30 years we have been doing this. Nothing will change about that. We will stay the course.
Our most talented people in the studio and the field are our leaders. A close-knit core of talented and experienced people that care deeply about what they do. Their jobs have become even much more demanding; as of late, they are tasked with running projects and spinning more plates, but also in mentoring more closely the younger staff who in many cases require even more training than in years past.
What we can ask of you, to be the best client you can be, is your patience and your understanding. Our team is working overtime unlike never before, killing it on every front to do what they do, as best as they can – for you. Please give us grace as we do everything we can to produce every project as if it is our only project during this challenging time. We will get you started, we will get you finished, and it will be awesome when it is complete!
When will conditions change, you ask? Well, no one really knows that for sure. Much will depend on whether people will be able to get out this summer, which will slow the trend for the buying surge that has been in place since last year. I can tell you this. Many, and I mean many of our manufacturers, have assured us they will meet the demand. They will have product, and they will deliver into the year as planned. Any chatter you have heard about not being able to get construction materials and product, well, you probably should not believe it. We don’t.
Experiencing Common Sense Remodeling with Advance Design Studio
Right NOW is a Great Time to Renovate!
One of the biggest benefits of this time is this; there really is probably no other time in history that you are more in tune with your home. I bet you know exactly what you want to make it truly fit the way you live by now. And whether you plan to renovate to stay or renovate to sell, despite the craziness – right NOW is an excellent time to renovate. Why, you ask?
The real estate market is hot! The average home is flying off the shelf! According to my real estate friends, move-in-ready (renovated) homes are receiving multiple offers on day one for more than the asking price! Mortgage rates are at historic lows, so borrowing money for a new home purchase, or for that new kitchen or the larger renovation right now is at the best point in recent history. You can make your money go farther now with record low financing rates.
Inevitably, some homeowners will still wait to renovate, which in turn will continue to place unprecedented demand upon the remodeling industry well into 2022. We saw this after 2008 when a surge of remodeling occurred following the “depression” from homeowners that sat on their hands with a “wait and see” attitude and finally had to fix their leaking shower! If you want to get that project begun this year, start now because you can rest assured the fall rush will most likely be even greater!
And the best reason to renovate now, besides all the personal benefits to you and your family, is that your renovation builds back into our local economy by supporting small businesses. Do you know that not only do you support 35 local families at Advance Design when you choose us but that we, in turn, support nearly 35 other local small business families through our subcontract teams? Additionally, our purchasing supports an untold number of nationwide suppliers who work for local communities and families. (Although some product and parts come from outside of the US, many of the products we recommend are made in the USA, including ALL of our cabinetry).
We continue to be grateful for the opportunities we have to follow our calling and impact you, your home, and the way you want to live. We believe that the partnership you choose for your renovation will make or break your renovation experience, so choose carefully. As in the words of our recent client Michelle Dixon, “ADS was equipped to handle every part of this renovation from design, through construction, to completion. “Common Sense Remodeling”… it really is possible with ADS!”
Thank you to all of you who have supported ADS in the past and plan to do so in the future. No matter the challenges this year, we plan to stay the course and will successfully get all our remodeling clients over the finish line!
I’m looking forward to my next letter to you. I will be introducing our amazing, brand-new website, almost ready for release, and sharing how our new client management software will continue to enhance our communication process and your overall renovation project experience! Can’t wait!
Get your next remodeling project going
Christine & Todd Jurs
Founders | Advance Design Studio, Ltd.