Commercial builders see no turnaround
A survey of non-residential construction companies conducted by FMI, a management consulting and investment banking firm, found that executives see the economic strength of their own businesses falling in the fourth quarter of 2012 compared with the previous quarter. Reasons cited include a reduction in backlogs, the continued rise of material costs and lower productivity.
FMI, based in Raleigh, N.C., interviews its panelists of construction firm executives on a quarterly basis, and its fourth-quarter Nonresidential Construction Index report (NRCI) was 55.5, less than one point up from last quarter. Overall, panelists were slightly more positive about the national and local economies. But when questioned about their own businesses, panelists cited five factors that are slowing their momentum down:
• Delays and cancellations
• Changes in project size
• Energy-related construction activity
• Market opportunities
• Experiences with the Office of Federal Contract Compliance
Builders FirstSource relaunches web site
Dallas-based Builders FirstSource unveiled its new company web site, at www.bldr.com.
Among the improvements are an “improved end-user experience,” along with location-specific information on products and services.
“The new website will provide an enhanced user experience and will give our customers much better information about our locations and the products and services we offer,” said Morris Tolly, Builders FirstSource senior VP of operations.
The site also includes videos on manufacturing, distribution and installed services.
Builders FirstSource currently operates 53 distribution centers and 44 manufacturing facilities in 9 states.
STAFDA distributors face risk and reward
What keeps Mike Kangas up at night? For the president/general manager of Alaska Industrial Hardware, it’s not concerns about business or the prospect of another dark and foreboding winter in Anchorage. It’s about seizing the next opportunity.
“My sleepless nights are due to anticipation of what’s around the corner the very next day,” said Kangas, a member of the board of directors of the Specialty Tools & Fasteners Distributors Association (STAFDA). “I’ve been in this industry my whole life. Every corner I turn, I’m always learning with enthusiasm — whether I’m buying product, selling in the stores or using tools hands-on in my shop. I couldn’t have picked a better job in my wildest dreams.”
Kangas’ enthusiasm and positive energy is a trait shared by other STAFDA board members, including Rick Lamb, marketing manager, Frank’s Supply Co., Albuquerque, N.M.; and Nils Lindbloom, president, The Tool Shed, Greenville, S.C.
Despite tough economic conditions — commercial activity and prospects in Albuquerque rank near the bottom among 100 metro areas, according to a recent study, Lamb said — these business leaders are resourceful entrepreneurs who have proven they know how to get the job done.
Kangas said that like the rest of the nation, the construction industry in Alaska has not been spared, but he does not despair. “Thank goodness work continues, albeit at a slower pace,” he said. “Sales continue, but customers are much more frugal. However, one thing we can always count on is winter in Alaska. Ice melt, heaters, snow shovel and outerwear will continue to do well.”
Lamb said commercial building in Albuquerque is stagnant these days, but because Frank’s Supply operates four other stores in other markets — and those are doing quite well — the business as a whole has endured. “Overall, it’s a good stable market,” he said.
Lindbloom said in Greenville, S.C., there are some fairly strong pockets of manufacturing growth that The Tool Shed is looking to capture. He said he knows it could be a lot worse. “We haven’t been as weak here as in some other areas of the country,” he said. “I’m guardedly optimistic about the future; however, a lot of people are waiting to see what happens in November.”
In this still recovering market for home building and materials, distributor executives such as Kangas suggest that to experience any growth, companies must be willing to search out new opportunities. “Whether it be remodeling or expanding locations, increasing an existing category, or thinking out of the box and trying something new,” he said. “Several years ago, we tried some portable storage shelters, just one or two sizes at first; now we are selling roughly 20 containers annually. Never miss an opportunity. Believe me, not everything we venture into is a success story, but if you never expand your horizons, growth will be limited, at best, in today’s market.”
The Tool Shed, as with other STAFDA members, is putting more focus on the Internet, including social media.
“The Internet is a tough market to break into,” Lindbloom said. “Still, we’ve been revamping our website, trying to make it look more professional. We’re using Facebook, email marketing, social media. But, really, we haven’t changed our clientele. We’ve been selling to professionals for 35 years. We have had to expand our product selection over the years; that is always expanding.”
The STAFDA directors point to the continuing advancements in Lithium-ion technology as the major trend driving power tool sales in 2012, with more to come in 2013. “Since Lithium-ion batteries are now very close in price to the old Ni-Cad platform, there seems to be a surge in cordless tool sales,” Kangas said. “Consumers are beginning to realize the advantages of Li technology. Brushless motors, although beneficial, haven’t caught up to the learning curve. I think 2013 will be the year brushless technology takes off.”
Lamb added that “advances in Lithium ion will be the story in 2013 as manufacturers build the family of tools that work around that system. Companies like Milwaukee are getting into trade-specific products, for such trades as electrical and plumbing.”
Lindbloom said there has been significant sell-through with the Fein MultiMaster, particularly the cordless versions, which he said are expanding quite nicely.
“We’re seeing growth in power tools from newer platforms that allow better ergonomics — lightweight yet longer-running batteries that allow for more exotic products. We’re seeing for the first time 18-volt sanders and other cordless varieties that we haven’t seen,” he said.
Lindbloom said ergonomics is increasingly important to today’s professional, and advances in ergonomics are being incorporated into lighter-weight power tools. “Tools with better grips and anti-vibration technology that ease the stress on the professional,” he said. “There is a lot more attention paid to worker safety these days.”