Jun 17, 2021 11:28:41 AM | 5 Min Read

What Lumber Prices in 2021 Mean for Wood Alternatives Manufacturers

Posted By
Danielle Fauteaux
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Alternative methods of new construction framing used to be of interest primarily to early adopter market segment, but are now being considered by the early majority of building materials buyers.

There is still a hesitance to leave behind traditional stick built methods of new construction, so when lumber costs started to soar, builder's first reaction was to offload the rising costs to their clients by adding price escalation clauses into their contracts. But as lumber prices remain high, and the push to keep construction moving continues, builders are starting to look at different materials and processes to replace traditional stick building for frames and trusses.

Top Alternatives to Lumber in Construction

Some of the top contenders to replace lumber in framing include:

  • ICFs (Insulated Concrete Forms)
  • SIPs (Structural Insulated Panels)
  • CFS (Cold Formed Steel) / Light Gauge Steel Framing
  • Structural Steel
  • Cellular PVC
  • Composite
  • Engineered Wood
  • Fiber Cement
  • Foam Core Panels
  • Welded-Wire Sandwich Panels

Total cost, availability, price stability, material durability, and installation familiarity are major decision making factors for builders and contractors. When trying to job cost materials at the start of a project that may not be purchased until months down the line, the fluctuation in commodity pricing can be a deterrent, and cause preference for wood alternatives such as SIPs and engineered wood options that are more more price stable.

 

How Manufacturers of Lumber Alternatives Should Respond:

In short: don't get left behind as construction charges onward.
  1. Provide information for researchers to help them compare the attributes and convenience of your product over any of the other alternatives. Learn more >>
  2. Make it easy for customers to buy your wood alternatives online or from readily accessible distribution partners. Learn more >>
  3. Generate demand for your products and route prospects to your partners to nurture and secure the sale. Learn more >>
  4. Communicate order lead times accurately before, during, and after the sale. Learn more >>
  5. Make it worthwhile for partners, distributors, and big-box stores to recommend your specific alternative to their customers. Learn more >>
  6. Implement operational efficiencies to deliver higher volumes. Learn more >>
  7. Deliver a superior customer experience throughout the sale; require on-site visits and on-site training for new customers. Learn more >>
  8. Make it easy for customers to find installation resources and understand how choosing your material will impact the other materials they need to purchase and how installer will have to adapt on the job-site. This resource by the Steel Framing Association is a great example. 
  9. Give your distribution partners talking points about the value proposition of your offering in specific projects and use cases. Learn more >>
  10. Align your channel marketing message to be end user and project centric, over product centric. Learn more >>

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How Long Will Demand for Lumber Alternatives be elevated?

So much pivoting has happened already over the past 18 months. It's important to continue making your business decisions regarding product positioning, channel management solutions, and distribution partner enablement with the long-term in mind.

In general, despite signs of rising lumber prices having reached the turning point, materials specifiers and builders are still on the hunt for cheaper, easy to install, and more readily available alternatives to wood framing. This trend is expected to continue through 2022 because of continuing supply chain challenges, low interest rates, and high demand for residential construction starts.

  • Architects are looking for innovative solutions and materials that compliment the rest of their design choices or give them even more artistic liberty than lumber did, like steel does.
  • Builders are looking for solutions that do not require hiring specialized labor or paying for extensive training for on job sites. Simultaneously, with longer lead times prevalent, builders are looking for solutions that allow them to decrease build time so they can supply more new builds while there is high demand and interest rates are low.
  • All stakeholders are looking for ways to decrease construction costs and increase buying power, so while lumber costs are decreasing comparatively, they are still considerably higher than they used to be.

Certain kinds of specifiers and customers will be more or less inclined to your wood alternative. Define their buyer's journey and improve your online presence throughout the channel to solve for your customers and capitalize on the market gap.

Are you losing opportunities to a disjunct channel marketing program or incomplete channel sales strategy? We help building materials manufacturers get their channel partners and program materials up to speed so you can sell more materials, better.

Interested, lets chat

Topics: Looking Ahead, For C-Level Executives

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