By Matt Ellis
By now, virtually everyone has felt the fallout of the Great Supply Chain Disruption, that started not long after the pandemic began two years ago. People have dealt with shortages of everything from cream cheese to pool liners to new cars. The disruptions have slashed across the building services industry, impacting supplies of cleaning chemicals, cleaning equipment, plastic can liners and sanitary paper products. The reasons are nearly as far-reaching as the products out of stock: the rising cost of pulp and packaging; the rising cost of resin; shortages of raw materials; shortage of labor; and, disruptions in shipping and trucking.
It paints an ugly picture.
“I’ve seen more price increases in last 18 months than I’ve seen in my 30 years in the business,” said Robert Tamilio Jr., vice president of Janitorial Sales for Imperial Dade, a leading distributor across the U.S. “Lead times typically ran 7-to-10 days. Now, it can take 3-to-4 weeks. We don’t get products to our warehouses as quickly as we once did.”
Tamilio, who is based in New Jersey, noted that occupancy rates in commercial office buildings drive business in his industry. He estimated NYC office buildings had just a 40 percent occupancy rate last month. Plans to bring people back to the office have fluctuated, creating uncertainty, especially for companies like Imperial Dade that source manufactured products.
Manufacturers have had their own problems restarting factories with shortages of raw materials, shortages of labor and unreliable – and extremely expensive – transportation systems needed to move their packaged consumables. But there are signs things are easing up.
Frank Trevisani, manager of Building Service Contractors for Spartan Chemical Company, the largest privately held industrial chemical manufacturer in the janitorial industry, said cleaning supplies are becoming more available, but are carrying a higher price. “If you are willing to pay [for your supplies], you can get them. At one point, we were shipping truckloads in seven days, now we are back to shipping within 24 hours,” Trevisani said, adding that $5 a gallon diesel prices are prompting price increases across the board.
Still, major product manufacturers have eliminated certain products or SKUs as a result of crimps in their factories. “Essity may have had three versions of their toilet paper, but now there may be only one,” said Tamilio. “We are at the mercy of the manufacturers. I show my customers what substitutions are available.”
For example, he said, AffinEco had traditionally purchased paper products from Kimberly Clark, but was forced to switch to Georgia Pacific, because the products they wanted weren’t available. He also noted that companies like AffinEco are generally buying less now than pre-pandemic to accommodate for fewer people working at office buildings.
Long before COVID, AffinEco joined a group purchasing organization known as the National Service Alliance (NSA), which helps building service contractors leverage their buying power. That has been extremely valuable during this period of supply chain disruptions.
“Our buying group has saved us significant percentages,” said AffinEco Managing Partner Paul Senecal. “They’ve helped us source things that would have been more difficult to get. Instead of buying as one company, we are buying as 35 companies, and that benefits all of us.”
Looking ahead, supply chain bottlenecks are likely to continue, in large part because of rising fuel prices. As Mark Williams, an analyst for the energy research firm Wood Mackenzie, told Bloomberg, “It’s one more reason why global commodity prices and inflation are so high.”
Trevisani summed up the situation this way, “I’ve never seen it like this. It’s one major thing after another.”
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