MEM Cuts Costs as Interest Rates Rise/ Interest rates are on a roller coaster ride and that roller coaster is heading up. This is a very real, and can be a very damaging problem for the US economy and the construction industry. As the chart below demonstrates the march higher began prior to April of 2022 and continues to this day. The purpose is to slow inflation to around 2% by putting downward pressure on economic activity through Federal Reserve rate hikes. In other words if money becomes too expensive, then industries such as construction will slow. The economy does not shift at a whim especially when all the forces are aligned for inflation at this time regardless of Fed policy. The point is that this maybe a long trend and not just a blip. Inflation has been very sticky and continues to be.
So what can be done in the construction industry to combat high interest rates that maybe here for sometime? Borrow less. Our industry engages in long-term commitments and obligations with slim margins. That applies more pressure as we build, meet payroll and see operating costs explode as simultaneously financing those costs increase. Suddenly, we grasp for every potential savings available by trimming general costs and seeking alternatives.
The right alternative is a commercial quality elevator that has a long-term history of success and that can replace the need for a construction elevator on the jobsite. By consolidating the tasks of a permanent elevator and a construction hoist, costs can be significantly reduced. But, only an elevator fully installed at the beginning of the project and ready for start up early on can meet the need.
The MEM Elevator System can cuts costs as interest rates and inflation holds firm. Below are just two recent projects that we just finished installing where the permanent elevator doubled as the construction hoist. Not having to employ a construction elevator can reduce costs immensely. This option is not just a way to save during inflationary times, but just smart business.
In both cases the elevator unit or MEM System was placed early in the project. The system is designed to be self-supporting, so it is placed and awaits power, set up and inspection. Placing the fully installed elevator takes less than four hours and the set up portion of the project is usually less than a week in total hours. This makes it not only plausible to save significantly, but a certainty of reducing costs.
As you can see from the photo the elevator operates just like any other construction hoist with a set call box for access. We also go to great lengths to protection the cab interior. Protective panels and wraps are in place during the build. You can also see that it is not a project dependent on any one type of construction method. the MEM System is at home in modular construction to stick built applications.
Additional project savings are due to fact that the MEM Elevator System arrives with the elevator fully installed in the factory produced hoistway. This includes elevator doors and frames. That means no call backs on tape and mud crews, painters and flooring contractors. It is estimated that $40,000 per elevator opening can be saved on most jobs.
If you want to find out more about how choosing the right elevator cuts costs click below. You can either get a thumbnail budget number for the MEM System for your next project or, your can schedule a live virtual tour. During the tour we will pull back the curtain, so you can see how we produce the best elevator solution for all mid and low-rise applications.