Matthew Verdick is well aware of the supply shortages that are impacting the construction industry.
That’s why the Rice County parks and facilities director plans to ensure certain building materials that are currently hard to come and that will be used on the county’s new law enforcement center are ordered ASAP. Verdick, who’s helping oversee the project, set to break ground sometime next year, said Tuesday that steel and precast concrete panels, which will likely be used in the new facility, will get moved to the top of the list when it comes time to order supplies.
Currently, delivery of steel for construction is taking 50-60 weeks. Those sorts of timelines not only means delays in construction, but could very well mean added costs.
Verdick, on Tuesday, said the Board of Commissioners’ decision to hire a construction manager for the project will help accelerate the ordering process for certain materials that are now in short supply. Instead of going out for bid in a single package, a construction manager can have bids awarded piecemeal, he said.
It’ll be a few weeks before the board approves a final design for the law enforcement center, which will include a $49.2 million, 76-bed jail and Sheriff’s offices. A preliminary schematic and renderings of the exterior shown to the board Tuesday drew a few questions, most about costs and exterior materials.
Commissioner Jim Purfeerst wondered about maximizing jail space for the inmate population which can fluctuate over time. Not only do inmates need to be separated by gender, those with special needs and requiring more intense supervision also need to be segregated others.
The jail space is flexible, said Danielle Reid, with Klein McCarthy Architects, and can be easily adjustable according to the inmate demographics.
Discussions about preferences of the exterior finishes were more subjective, with architects showing the board a front facade covered with Kasota stone, clear glass and brick, and one with brick — possibly a dark, almost black brick — and precast concrete panels. In either instance, the remainder of the building will likely be made of precast panels.
But while using precast panels has traditionally been a cost-saving measure, Verdick says that more recently brick has been cheaper. For now, he said, the architects and county-appointed task force will consider different options and bring them to the board for a final decision early next year.
The law enforcement center, which was approved by the board in May, will replace the existing Sheriff’s offices and main jail downtown, along with the jail annex on Hwy. 60 just east of the interstate. The board hasn’t yet determined what will happen with those buildings once they’re vacated, though the annex could return to the federal government, which owned the building previously. An agreement to purchase the annex included a stipulation that it needed to be used for law enforcement purposes.
The new jail was approved after the state Department of Corrections threatened to limit the number of days inmates could be held in the main jail, which houses medium and maximum security inmates, because it didn’t have the required amount of space for recreation and programming. Those limits would put a significant squeeze on the Sheriff’s budget, former Sheriff Troy Dunn told the board, and increase the time deputies need to spend transporting inmates to and from jails in nearby counties as well as keep they tied up and away from the other obligations with the county.
From clothes and couches to cars and air conditioners, things just seem to be missing from the shelves more often these days than they used to be.
For Lisa Schlueter of Waseca, who has struggled to find themed lights and other decorations ahead of the holiday season, the timing is exasperating. For Owatonna’s Shyanne Hensley, the problem is somewhat more pressing.
“It’s getting hard to find the brand and sizes of diapers we need,” said Hensley.
These anecdotes and impressions among local residents are borne out in the experiences of local business owners, whose own problems securing inventory make them keenly aware of the frustration their customers are feeling. Ryan Glassmaker, owner of E-Z Own Plus, a furniture store with locations in Owatonna and Albert Lea, has seen it too many times recently.
“Everybody gets a sober look on their face anytime you tell them the order time,” Glassmaker said.
That order time is four to six months for furniture from E-Z Own Plus, compared to four to six weeks before COVID-19 disrupted global supply chains. This has made him lose customers.
The fact that his prices are also creeping up on nearly every product category he keeps in stock probably isn’t helping, either.
The one problem Glassmaker has been spared that other business owners have not been is the cost of shipping, which has increased astronomically in recent months. That’s because he picks up most of what he sells himself from a warehouse in Wisconsin.
For Camille McCarthy, general manager at Finally A Gift Store in Faribault, the pressure of the impending holiday season is increasing.
“We’re having to order much sooner than we normally do so we get it in, and if you don’t order soon enough, you’re not getting all of your products in,” McCarthy said. “We’re still ordering stuff for the holidays and some companies are quicker than others.”
With other shop owners like herself also ordering well in advance of the holidays, anxious to be left empty-shelved during retailers’ most profitable season, the shipping cost has also gone up, in addition to McCarthy’s products shipping and arriving later. The prices of some of her products have also increased recently, as the companies from which she buys her products raise their own prices.
Fortunately, in only the last year or two, McCarthy made a shift in the way she does business that has saved her from much of the pain other retailers are currently experiencing: she started filling her shelves with more local products.
“Just kind of a lucky coincidence,” she said. “We fell in love with these companies. It’s a better feeling, I guess.”
Rather than being beholden to global supply chains beginning in countries across the world, where manufacturing may have been halted due to the way that country’s government is handling COVID-19 or experiencing their own supply chain problems, McCarthy can simply look for companies near her. While they may not be quite as cheap and efficient, they can deliver goods far quicker and with much less uncertainty.
Goods she’s ordered from China or other countries that have to be placed in shipping containers and shipped overseas, however, such as her home decor gift items, are a different story. Orders placed in February, for instance, have only recently arrived.
“It’s been a bit of a challenge, I would say,” she said.
What’s taking so long?
The novel coronavirus emerged in an unfortunate location for the global supply chain.
That location is Wuhan, a key manufacturing hub in China — the manufacturing capital of the world. For a vast array of products, it’s also where the global supply chain begins. When the Chinese government shut down factories to stop the spread of COVID-19, other manufacturers requiring their goods — semiconductors, auto parts and more — to produce their own goods could no longer do that. This meant fewer goods being produced overall.
At the time, economists predicted that while the supply of goods would decrease, the temporary closure of stores and malls around the world would similarly lower demand. The problem, in other words, would cancel out.
This turned out to be wrong. While supply became depressed and stayed that way, demand didn’t stay low for long. Spending more time at home, demand for electronics, furniture and more ticked up. While unemployment also temporarily reached very high levels, former President Donald Trump’s $2 trillion coronavirus relief bill in March 2020 — followed by President Joe Biden’s $1.9 trillion relief bill a year later — helped keep that demand strong.
But with all those factories shut down for so long, and demand having piled up in the meantime, acute bottlenecks started causing massive delays as manufacturing groaned back to life. Warehouses began to fill with products as companies found themselves unable to take in all the product they’d ordered, a problem exacerbated by the recent shortage of truck drivers who would bring normally transport inventory from warehouses to local stores. This caused massive traffic jams at sea as shipping ports were unable to transport their inventory to warehouses, and thus could not take in more containers.
With this new urgency and demand for shipping, prices have also skyrocketed. And with big businesses like Walmart, Target and Amazon able to pay those high prices to stock their shelves, the small, independent businesses have suffered the worst of those delays and shortages. The pandemic also accelerated consumers’ transition to e-commerce, further hurting small retailers and sending their customers to Amazon and a few other online giants.
Companies ordering in excessive quantities before the holidays have only made the situation worse.
For Beret Froehle, manager of the Rare Pair, a shoe store in Northfield that sells other goods like clothing, handbags and winter accessories, it has been more difficult getting some products than others recently. Getting shoes, for instance, has been far more difficult than clothes.
“A lot is dependent on where are the factories and where are specific companies,” Froehle said.
Many of the shoe companies the Rare Pair orders from ship their products out of southeast Asian countries such as Vietnam, many of which have had to intermittently close their factories in response to surges of COVID-19 and a lack of available vaccines in those regions. For the Rare Pair, that means waiting a year to receive an order of sandals, rather than the usual six months. Sometimes it means orders are cancelled altogether.
While few of her customers are surprised by the situation, Froehle added, she suspects some customers are ordering online what the Rare Pair hasn’t been able to acquire. Still, she said, she continually feels “really lucky that people continue to shop local.”
With delays and cancelled orders already upon her, though, Froehle’s advice was clear: “Shopping early for the holidays is really the way to go this year.”
One might think Jacob Dougherty, owner of Waseca County Auto Sales, would be somewhat more immune to supply chain issues. He sells used vehicles, built before the supply chain disruption.
The problem, Dougherty said, is that “it all trickles down.”
“The [shortage of] new cars put[s] a strain on the used cars and drive[s] the prices way up,” he said.
While Dougherty said supply chain issues have not been as much of a problem as securing enough employees, the supply chain issues have gotten worse in recent months. Part of that is getting car parts — what used to arrive in a day now takes three to five days. This delay is due not only to complications with manufacturing overseas but to a lack of truck drivers and other employees needed to bring the parts from the manufacturer to all its different stops before arriving at Waseca County Auto Sales.
It’s affected his and other car dealership businesses in stranger ways, too: buying back cars from customers sold a few years ago for a higher price than they sold them for, because demand is so high that they can then be resold for even higher, for instance.
“That’s just what the market dictates,” Dougherty said.
And while the market mostly seems to be hurting consumers in the moment, Doughery emphasized the financial instability it heralds for businesses.
“What if the market did shift and I’ve got 100 trucks on my lot that I paid $50,000 for that are now worth $40,000?” he said. “I’m out of business.”
What Dougherty tells his customers that balk at the sky-high prices of vehicles is if they don’t have to buy today, it might be worth waiting until the market simmers down. But he doesn’t think that moment is coming anytime soon.
“And maybe I’m wrong,” he said. “I have no idea.”
For many nonprofits, like Ruth’s House of Hope, donations can make all the difference.
Outreach and Communications Coordinator Sandy Varley writes in an email that Give to the Max Day is just one example of the compassion and generosity the community has for local women and children seeking a brighter future.
“My years spent as a volunteer and now as the outreach and communications coordinator are filled with countless stories of our friends and neighbors stepping up to help families at Ruth’s House,” said Varley. “Your gifts go far to provide families with shelter, food, assistance, and safety.”
Each year on a Thursday in November, Minnesotans across the state support various nonprofits — from schools to community organizations. The day is part of GiveMN’s Give to the Max campaign, a statewide outpouring of support for thousands of nonprofits and schools, according to its site.
The giving holiday this year is scheduled for Thursday, Nov. 18, but early giving has already been taking place since Nov. 1. GiveMN’s records show last year, Minnesotans donated a record of $30.4 million, passing the previous record of nearly $22 million in 2019.
Though the last 18 months have been difficult for a variety of reasons, GiveMN Executive Director Jake Blumberg said in a press release, they’ve seen an “incredible” response of Minnesotans digging deep into their pockets.
“Give to the Max 2021 provides a well-timed opportunity to help our state’s vibrant sector of nonprofits and schools remain resilient as they continue to respond to the needs of our communities,” said Blumberg.
A variety of nonprofits, churches and schools participate in the campaign each year, like Buckham West, Rice County Area United Way and First English Lutheran Church. Some, like United Way, also partner with other programs and agencies beneficial to the community throughout the year.
On its posting in GiveMN, United Way representatives stress the importance of donations in order to help Rice County neighbors in need. Organizations like Rebound Partners and the United Way Board will match donations, and funds will be used for the greatest needs in the community, helping children, the elderly and others struggling since the pandemic with food, housing, education and health. As of Nov. 16, the organization was at 72% of its $5,000 goal.
In November 2009, GiveMN states, Give to the Max Day was supposed to be a one-time only launch party for the new fundraising platform GiveMN.org with a goal of raising $500,000. At the end of the day, generous donors had given more than $14 million in just 24 hours, according to the site, blowing its the out of the water, and starting a giving holiday in Minnesota.
Statistics show that through the Give to the Max and other giving events, donors have given more than $220 million to more than 10,000 nonprofits and schools. In March 2021, a press release states 30% of nonprofits in Minnesota reported having less than six months to go before they exhibit financial stress. Donors, it says, play a critical role in supporting organizations working to achieve their mission to contribute to stronger communities during the all-important year-end giving season.