Price increases have been on the rise since spring of 2020 on pretty much all materials and goods. What has basically happened is that much of the parts and materials are kept in an inventory which we preordered based on past demand and available supply. When that inventory is depleted by the double whammy of increased demand in the 3-fold range from people sitting at home practicing retail therapy for the better part of a couple years and factories being shut down because the workers are sick/fearful of becoming sick, getting supplies becomes expensive and slower.
This isn't a Benchmade thing. It's a *gestures broadly to the world* thing.
In my business, I buy from a supplier. I am having a hard time getting my product because they are having a hard time getting completed goods from the vendors who are having a hard time getting said goods from the contracted factories who are having a hard time getting steel from the mill due to demand of all things metal and electronic components from China because there was a delay getting the parts made due to covid last year and the are now sitting on a ship out in the ocean with 500 other ships because there aren't enough truckers to pick up all the crap from the docks we are wanting to buy and make it to the CSLs in the middle of the country where products sre divvied out to the various branches businesses like mine buy from. So it is expensive, slow at best, and most likely infrequent and unpredictable as to when things are going to show. Makes scheduling jobs a nightmare.
Look at it this way: Barring that everything simply IS going to be more expensive to purchase due to inefficiency, take the math needed due to supply into consideration. Let's say that Benchmade or any manufacturer must sell 1,000 knives in a year at $10 per knife to break even/hit their target/whatever. They know the market is going to net them those sales, but they of course NEED those 1,000 knives to sell. So that means they need to sell $10,000 worth of product.
Well what if they can't get 1,000 knives due to supply chain issues? What if the best case scenario is that they can get 900? They have to make $10,000 to keep the factories going. Beancounters do some math and figure that the market will support a 10-12% increase and still sell out those 900, so Benchmade marks the knives $11.12. They make their $10,000...plus 8 bucks.
Obviously there are tremendously more complicated things thst go on in running a multi million dollar manufacturing business, but this is just a stripped down version of just one reason why we are seeing everything go up. In my line of work, I am seeing a minimum of 7% and as much as a 13% increase. What sucks is that I am selling jobs out 14 months from now that are under contract. If I don't buy what I need NOW I'm probably going to take another hit to my bottom line, which means I have to purchase a ridiculous amount of product with money I don't have in hand, take extremely large deposits from customers which i hate to do, or give it a good guess and sell my jobs with prices reflecting the costs I anticipate. Manufacturers are in the same boat. Instead of contracted work for homeowners, they have to anticipate inflated material costs for goods that will he sold in 2023 and price accordingly.
It's a really complicated time to run numbers, and Crystal Balls are on backorder.
