Hardware stores caught off guard by demand spike

CEBU, Philippines - Hardware stores in Cebu were caught off guard by the sudden surge of demand for construction materials and scrambling to respond to the fast rising demand from reconstruction efforts in typhoon-hit areas.

It has been a month since super typhoon Yolanda brought massive devastation in most parts of the Visayas region leaving over 7,000 casualties and thousands homeless.

Federal North Hardware Inc. manager Jojo Espelita said now that relief operations are slowly shifting into rebuilding the homes of those severely affected by the typhoon, survivors and donor organizations are currently in dire need of construction materials pushing the demand to surprising levels.

Espelita said that although manufacturing plants across the country may have enough supply of construction materials, the distributors and retailers may still find it difficult to cope with the surging demand as the delivery and shipment of the stocks would usually take time.

He added that they also have difficulty in managing their inventories since they also have to attend to their regular customers.

He admitted that it may take the entire year of 2014 for industry players to adjust with the unexpected demand.

Banilad Cebu Trade Center Inc. manager Jun Manglapus echoed the same sentiments of Espelita, saying that hardware stores usually have normal stock level that is supposedly enough for the market.

However, due to the calamities that have struck the region, hardware stores may experience a supply shortage since they still have to arrange orders from suppliers who are mostly based in Manila and it would take around two weeks for the new stocks to get delivered.

Manglapus said that December is usually a lean month for hardware stores, thus most of the establishments were stunned by the sudden surge in demand.

He said that this trend is expected to linger until next year as other affected families may still have to find resources to buy the needed materials to rehabilitate their homes. Others will have to rebuild their livelihood first to generate income to sustain their basic needs and reconstruction of their shelter.

Meanwhile, Department of Trade and Industry Cebu Provincial Office (DTI-CPO) Consumer Welfare and Business Regulation Division chief Zaide Bation lauded the commitment of hardware stores not to increase their prices until December of this year amid the high market demand.

“They are true to their word,” she described.

It was last November 19 that DTI-CPO gathered 14 Cebu-based manufacturers of cement, galvanized iron sheets, steel wires, nails, steel bars, and galvanized iron pipes to discuss their efforts in ensuring the availability of construction materials especially for the affected families from the typhoon.

Local manufacturers committed not to increase the prices up to December 2013 and will continue to do the same up to the first quarter of 2014 as long as there is no increase in raw materials, labor, operating and manufacturing costs.

They also agreed not to engage in illegal acts of price manipulation but instead maintain the quality of their products and comply with product standards given the increase of demand for construction materials.

Bation however lamented that this unexpected demand from typhoon victims may affect the regular customers of these stores.

She cited that establishments have to allot a percentage of their supply to be intended for donor organizations and typhoon victims so as not to leave behind their regular clients.

Espelita and Manglapus pointed out that hardware stores cannot determine which of their customers are buying for their own consumption or for distribution to typhoon-hit areas.

Bation reminded hardware stores to maintain attending to their normal buying customers while coping with the unpredicted demand of construction materials for the rehabilitation of houses and infrastructure in calamity-stricken areas.

She added that the trade department will continue to monitor the prices and supply of construction materials in the market.  /JOB (FREEMAN)