How Product Shortages Resulted in Panic Buying in the Forest Products Industry
In the past couple of years, material shortages became the new normal. As a result, many dealers were left searching for almost any product to fill the void. Panic Buying in the Forest Products industry became the new normal. Builders needed to finish homes. Homebuyers wanted desperately to move into their new homes and all the while, products were not available. This resulted in a loss of both time and money.
Some manufacturers even considered leaving unprofitable territories to supply what product they had to regions deemed more critical. When this happened, both builders and dealers were left in a panic. The industry then rushed to meet this growing demand by increasing production. For some, this meant adding manufacturing facilities.
Panic Buying in the Forest Products Industry Consequences
Suddenly, dealers had inventories that were 4-5 times more than normal. The panic buying happened because dealers were doing all they could to take care of their customers. However, when circumstances changed, manufacturers that originally left a territory, decided to return. This only worsened the situation, turning the deficit in production into an oversupply. Ultimately, this hurt the dealer and wholesaler, as they are the ones now suffering from low inventory turnover.
Why Trust Matters
Inevitably, as manufacturers evolve, decisions will have to be made regarding how, and where they will profit most. However, during the pandemic, manufacturers’ decisions to leave and return to regions within a very short time frame. Or, they put their customers on severe allocation, resulted in panic and chaos. Many dealers are in fact still suffering from this decision.
As a manufacturer, Belco Forest Products is committed to supporting customers who choose Belco XT products, even as the market fluctuates. In fact, during the pandemic, Belco continued to remain reliable by meeting the demand. Our customers are much more than transactional buyers. They are partners, and even more importantly, family. This is not to say that there will never be shortages or supply chain issues. However, we are dedicated to the experience and needs of those we serve. Learn more about Belco XT Products today.