An Update from Our Purchasing Department
By Kim R. Dykman
The purchasing team at Apex Spring & Stamping is always watching and monitoring the supply chain and markets. I’ll be honest, I was hopeful to greet a sense of “normalcy” in the markets after the new year. But, a few months into 2023, I am realizing that the “normal” we knew before, may never apply to manufacturing again. Despite this, our team will always forge forward, confident and determined to deliver the same level of service and quality our customers have come to appreciate.
First, some good news is that some of the clogs in the supply chain have resolved themselves. There are still some shortages, and we have seen some items quoted with shorter lead times but unfortunately, the reasons for this are not positive. Due to higher interest rates, fears of recession, and certain sectors slowing down, there is still an increase in demand. Infrastructure projects, military equipment, and a handful of other industries continue to show 1% – 2% year over year global increases.
Many analysts are questioning decisions made by the industry as a whole. Over the past few years, the steel industry profits have increased but they have neglected to invest in their own future. The traditional production process for making steel is considered “high polluting”. Most of the mills have not invested in developing the technology needed to make the process cleaner and more efficient. Warehouses and distribution centers are critical links in the supply chain. Manufacturers rely on well-stocked suppliers to keep inventory moving, track orders accurately and fulfill them quickly. Additionally, due to the limited availability of a workforce, there is an increased need for automation. Yet most companies have neglected to purchase and implement the resources available.
Many customers were planning to see lower prices for steel, wire and many other items needed in the manufacturing process however, this is not what is happening. Instead, we are seeing increases every week in the market. Our suppliers are paying even more than they did at the height of the pandemic. While we are not happy with the ever-increasing prices we have made sure that Apex has material on order to make our customer’s due dates. Sometimes we don’t even know what the price will be when the material is delivered. However, to protect our customers we make sure it is delivered. The Apex team is doing several things in order to keep prices similar to what we paid in 2022 whenever possible. We are increasing amounts purchased, combining materials on incoming trucks to save on freight, and in some cases locking in prices for material already on our service center’s shelves. Our team will continue to think of creative and new ways to keep our pricing level when we can.
Can We Help?
At Apex, we are dedicated to meeting all challenges, including those from the supply chain, head on. We work hard to provide competitive pricing and on time delivery to our customers, and we always will. Can we help with your next project? contact us or request a quote today!