In this series of articles (see Parts 1 & 2), we’ve been explaining some of the reasons why Ipe decking materials can vary so widely in price. We looked at a hypothetical scenario involving a contractor who made a purchase of Ipe decking early in the deck-building season. Because the timing was right, he got a good deal on his purchase, in spite of having to pay the overhead for the larger packs of Ipe to be broken up so the wholesaler could find the right sized boards to fill the contractor’s order.
In our last article, we mentioned that a month and a half later, the contractor is quoted a much higher price even though he comes back seeking to make a far larger Ipe decking order so he can complete several simultaneous projects. To say that the contractor is surprised would be an understatement, even though the wholesaler tried to warn him at the time of his previous purchase that prices were bound to go up. At the time, the contractor ignored this warning, assuming it was just a sales pitch to try to scare him into buying more lumber than he really needed.
The wholesaler once again has to explain to the contractor that Ipe decking prices really do go up dramatically throughout the season. The supply available to the wholesaler from Brazil begins to diminish. That raises the prices that the wholesaler has to pay.
The wholesaler also lets the contractor know that even though he is planning on purchasing a large amount of lumber, there will still be an overhead cost. Earlier in the season, there were plenty of large, untouched packs of Ipe decking materials available for purchase. Buying some of those full packs when the prices were still low would have gotten rid of the overhead cost associated with picking through the packs of lumber. But the available Ipe decking inventory this late in the season is greatly depleted. That lower inventory means higher prices due to supply and demand.
Additionally, other customers have also been requesting small orders throughout the past month and a half. That means most of the large packs of Ipe decking materials have already been broken into. Therefore, there simply aren’t large, untouched packs of Ipe decking left on the shelves waiting to be purchased. That means that no matter how large the order may be, there will still be an added overhead cost, because the wholesaler will need to pick through the opened packs that are left, searching for the right sizes of lumber to meet the contractor’s requirements.
Disappointed, the contractor learns the hard way that paying for a large quantity of Ipe decking material early in the season could end up saving him a lot of money in the long run. None of this is the wholesaler’s fault. They’re simply forced to change their prices as their inventory changes due to the change of season as well as supply and demand. As conditions change, prices are bound to change. Customers can learn from this scenario to stock up on Ipe decking early in the season, so they aren’t forced to pay more when the prices inevitably rise.