The Great Appliance Shortage and Possible Solutions
Why Appliances Are Hard to Find in Stock and What Are the Options
Author: Tim Moegen
September 30, 2022 - 4 MIN. READ
For want of a refrigerator, the remodeling project was lost. This modernized version of an old proverb is apt for today’s multifamily property owners facing an appliance shortage.
Large appliances are difficult to find in stock, especially in the quantities and varieties needed by multifamily property owners. This article will explore the appliance shortage and offer simple suggestions to help multifamily property owners overcome this obstacle.
Have you tried to order appliances for your multifamily property recently? COVID-related supply chain issues have played a primary role in the current shortage, with resulting rising raw material costs and a lack of semiconductors adding to the difficulty. Additionally, you are competing with the myriad Americans who, despite rising mortgage rates, want to remodel their kitchen now that they have lived in it for several years.
COVID-Related Supply Chain Issues
Once countries started lifting COVID restrictions in manufacturing plants and ships started leaving China carrying the parts and supplies that had been backordered for months, headaches began to alleviate formany contractors, property owners and property managers’ headaches began to alleviate. But sadly, this relief was short lived.
Many property owners had taken several steps to mitigate the risk to their own multifamily property supply chains only to discover that while hand sanitizer could be found in abundance only an increasingly small selection of showers, vanities, and other appliances were readily available.
Unfortunately, unsnarling the global supply chain has proven itself to be a Gordian knot. Ongoing waves of COVID continue to close plants and ports in China. And many manufacturers struggle to complete appliance assemblies because some critical components are delayed or not available. Further, once appliance shipments finally arrive stateside, major U.S. ports lack the personnel to unload the ships. Even when the containers are finally unloaded, an ongoing labor shortage in the trucking industry leads to issues with distribution and warehousing throughout the U.S.
Appliance repair suffers from the same fate. Although multifamily owners and their maintenance technicians may be able to book an appointment with a contractor to analyze the problem, the contractors are also waiting in line for replacement parts.
The end result is that manufacturers work on an appliance and then place it to the side, waiting for additional parts to continue assembly. Appliance repair suffers from the same fate. Owners and technicians may be able to book an appointment with a contractor to analyze the problem. However, they are also waiting in the lengthy queue for replacement parts.
Rising Raw Material Costs
Whether you are interested in refurbishing your multifamily units' kitchens or replacing the washers and dryers, the rising cost of raw materials is causing appliance prices to increase.
Even as the global economy begins to normalize after the onset of COVID, tin prices have nearly doubled since last year. Tin is a primary component in many appliances. It is also used to solder the appliance parts together and in various other manufacturing activities. Its cost, scarcity, and high demand combine to keep the cost of any final product containing tin at an all-time high.
Semiconductors have been in the news recently, as they are used in everything from microwaves to minivans. The U.S. and Europe dominated the semiconductor market when they emerged in the 1990s. Since then, China has Quickly taken market share and is poised to become the largest semiconductor producer within the decade. To avoid being held hostage by the semiconductor industry and global shipping snags, the U.S. government recently passed the Build Back Better Act and the CHIPS Act to jump-start domestic semiconductor manufacturing.
While you may want to order appliances in bulk to remodel several units at once, you may struggle to place bulk orders as you may face stiff competition from others including American homeowners, property managers, and contractors.
Despite increasing interest rates, the housing market remains highly competitive. The average home in the U.S. has seen an equity increase of $52,000. Some of this increase is a direct result of the growing work-from-home movement. Sixty-one percent of Americans who have the choice to work from home or from an office choose to stay home.
As a result of working from home, many homeowners are interested in either purchasing a larger home to accommodate an office or simply remodeling the home they own. Either way, a kitchen upgrade ranks high on the to-do list. With more time spent at home, more families gather in the kitchen for meals, for work, for study, or simply for socializing.
Your multifamily property is in direct competition with the Joneses.
The Appliance Shortage and Solutions
All is not lost, however, in the Great Appliance War. The following simple suggestions can give you a leg up in finding the appliances you need.
- Planning is vital to your success. Order your appliances as early as possible in the remodeling process. You already know the square footage and layout of each of your multifamily property unit’s kitchen and bath. You know the configuration of the plumbing. You also know which units are likely to become vacant in the near future and are ready for an upgrade. Armed with this information, order the appliances before the unit is even vacant to ensure that your project will not grind to a halt due to the lack of a refrigerator.
- Flexibility is your friend. If you can remain flexible regarding some of the options for your appliances, you will find a much larger selection. Knowing that an upgraded kitchen appeals to your tenants, watch for quality Samsung and LG appliances to go on sale. Most homeowners are already loyal to a certain brand. Most tenants are happy to have a new kitchen regardless of the brand.
- Work with independent appliance stores. Often, even as big-box stores have a waiting list for appliances, independent dealers have them in stock. Not only will you be able to continue your project, but you will be supporting local businesses that keep your community the thriving, vibrant area in which your tenants want to live.
Raiven Helps Multifamily Property Owners
Why try to find a needle in a haystack on your own when you can partner with Raiven?
Raiven serves multifamily property owners and managers by providing the lowest prices on equipment, parts, and maintenance supplies as well as a purchasing platform that makes buying fast and efficient. Key benefits include:
- Pre-negotiated discounts of 7-25%+ from big name suppliers like Ferguson, HD Supply, Grainger, Graybar, Office Depot, and more.
- Supply chain alerts for price and product availability changes on the items that matter to you most.
- Private marketplace houses all your preferred suppliers in one location for easy access to your discounts. No more bouncing around websites comparing prices.
- AI-powered purchasing tools that find the lowest prices even when employees shop outside your network.
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