Navigating disrupted supply chains demands sharper visibility, stricter product scrutiny, and greater pricing transparency. Businesses need to closely review supplier arrangements, verify the conformity of any substitute products, and treat alternatives as entirely new items with their own compliance and handling requirements.
With product ranges tightening and costs shifting, asking suppliers for clear evidence behind price increases – and documenting every substitution, risk, and movement – helps protect project quality, ensure regulatory compliance, and maintain trust with clients.
Review supplier arrangements closely
Review your supplier arrangements closely. Aim to understand both current changes and those still to come.
Try to get expected timelines and details applicable to the local market, not generic blanket forecasts.
Expect the pre-conflict range of products available to shrink and understand which will still be readily available and which won't.
Treat every “alternative product” as a different product
A similar product from an alternative source will have different specifications, performance, durability, and compliance status.
Ensure product conformance when considering alternative products. Any substitute product must still meet all regulatory requirements. Check the conformance information, including test reports, certifications, and Australian Standards/National Construction Code (NCC) compliance. Be alert to products with vague descriptions, inconsistent packaging, or missing labels. For guidance on the conformity questions to check out the Specifiers & Installers Guide by NBPC.
Don't rely on verbal or undocumented assurances. If a supplier isn't prepared to provide all the necessary product conformity data, or doesn't have it, assume the product is non-conforming. If the conformity data is forthcoming keep it on file for future audits or defect claims.
An alternative product may also have very different weight and packaging characteristics, changing how it needs to be transported, handled and installed.
Transparency in pricing
Having a clear and detailed understanding of the nature of the cost increases will help in your own conversations with clients.
If suppliers are charging more for current products, insist on seeing evidence the higher prices are really justified (freight, raw materials, energy). Ask for justification of the price increases.
Question suppliers about their calculations and work with suppliers who provided transparency.
These are the questions you can ask. They are the same questions that the Australian Competition and Consumer Commission (ACCC) would ask if they were investigating false and misleading claims.
- How is your price increase calculated?
- What cost increases led to the price increase?
- What transparency can you offer to reassure that the price increase is justified and not being used as a general price increase?
- What evidence can you provide to demonstrate that your operational expenses have increased? For example, what fuel index or pricing reference do you use, and how often is it updated?
- Is the increase temporary or permanent, and what conditions would trigger its removal?
- What measures have you taken to reduce or offset the increased costs before passing them on? Have you explored efficiencies or alternative suppliers?
- How do you ensure the price increase is proportionate to actual cost increases?
- Have you assessed how the price increase affects your customers’ project costs and competitiveness?
- Are you willing to review or negotiate the price increase?
Finally, document everything, especially substitutions, price movements, and delivery risks.