Dear Friends:
Since last month’s letter, we have seen some softening in the private commercial construction market, but we have also seen an increase in the public sector. School and road & bridge construction appears to be going up just as private commercial construction is going down. It’s still a very cloudy outlook for the near-term, but we continue to take it one day at a time and, our year is still going quite well for us.
Inflation is lessening a little bit with most products, and there have been some encouraging signs that prices may be coming down a little bit in the future. A prominent oil market analyst on CNBC projected recently that oil will be down to about $80 per barrel within the next 6-9 months. Given that oil almost hit $150 per barrel, that would be a welcome occurrence, as she said that might bring gas back down to $2.00 to $2.50 per gallon. However, there are still some price increases coming in the next 30 days. To learn more about the pricing outlook for our main products, please see below.
As most of you are aware, the market price for oil, steel, and other commodities has decreased, or at least leveled off, over the past 4- 6 weeks. This is due mainly to lower foreign and/or domestic demand. We are already seeing the effect of this lower demand on prices for some but not all construction materials.
Nucor announced on August 13th that they would lower the price for their September rebar rollings by $30.00/ton. Other domestic rebar mills quickly followed with their own price decrease announcements. This is mainly due to a decrease in the cost of scrap steel and reduced foreign demand. As most rebar distributors and brokers purchased heavily in August, speculating prices would continue to rise; the cost to the contractor should remain at or about the current prices through most of September. If scrap steel prices rise again, or if demand increases, most industry experts speculate rebar mills will increase prices accordingly in October.
As reported in our July newsletter, masonry reinforcing manufacturers did implement a 10% price increase the first part of August. As wire rod manufacturers did not raise prices in August, Wire Bond, Hohmann & Barnard, and Dayton (Dur-O-Wal) have announced they will not raise prices in September. Although there will be no price increase for masonry reinforcing and ties in September, manufacturers have already notified their distributors that they will be increasing prices between 10-15% the first of October, as wire rod manufacturers will be raising prices September 1st. If you have any upcoming projects that require masonry reinforcing or ties, we recommend you considering buying out these projects before October 1st.
The three major rebar and wire mesh support manufacturers, Meadow Burke, Universal Building Products, and Dayton Superior will all increase prices across the board by 10% September 1st. This increase includes both metal and plastic supports. Increased costs for plastic resins and transportation are given as the reason for this increase.
Concrete reinforcing wire mesh manufacturers have notified their distributors they will not increase prices in September, as their cost for wire rod did not rise in August. This “good news” will be short lived, as they have also said they will raise prices by 8-10% in early October, due to wire rod manufacturers raising prices in September. As with masonry reinforcing, if you have any upcoming projects requiring concrete reinforcing mesh, we recommend you buy out the projects prior to October.
Most manufacturers of construction chemicals have announced they will increase prices for solvent based curing compounds, concrete sealers, penetrating sealers, and epoxy coatings and bonding agents by 12-15% effective September 1st. They also have announced they will increase prices on the same water based products by 3-5%. These increases are due to their increased costs for resins. Normally chemical manufacturers purchase raw materials months ahead of time, so the full impact of the record resin increases over the past 8-9 months are just now being reflected in their costs.
Polyethylene Manufactures have indicated they will hold current pricing through September. This is due to polyethylene resins manufacturers rescinding the price increase that was to take effect in late August. Decreased demand and the drop in oil prices were given as the reason for rescinding the resin price increase.
The price for copper and stainless steel has stabilized over the past several weeks; therefore Sandell Manufacturing, Hohmann & Barnard, Advanced Building Products, and other manufacturers of copper and stainless steel thru-wall flashings have announced they will hold prices at current levels through September.
Manufacturers of peel-n-stick thru wall flashings, such as Sandell Manufacturing, Wire Bond, and Hohmann & Barnard increased prices the first part of August by 15% on flashings and accessories. These price increases were due to their increased costs for raw materials, especially for solvents used in the manufacture of these products.
With the cost of cold rolled steel still rising, manufacturers of cold rolled construction products will raise prices by 16-18% September 1st. Prices for items such as metal keyway (screed key), keyway stakes, dovetail anchor slot, metal reglets, and nail stakes will all be affected by this increase.
The latest Producer Price Index charts and tables are out.
Click here to view
the charts and click here for the tables.
Also, this month, we are doing a readership survey for this newsletter.
Please take a minute to answer these five questions by
clicking here so we can see if we can make the newsletter even more helpful.
For you golfers, don’t forget that our annual New South Charity Classic benefiting the Make-A-Wish Foundation is coming up soon. The first date is September 15th at the Woodlands Golf and Country Club in Columbia, SC. This is followed by our North Carolina event at Sedgefield Country Club in Greensboro, NC on October 20th. If you were watching the PGA Tour last weekend, you got to see Sedgefield, as it hosted the Wyndham Championship. I watched quite a bit of it and saw the pros raving about the redo of this almost 80-year-old Donald Ross masterpiece. And, if you watched the tournament you saw that the conditioning of the golf course was also raved about by the touring pros. I, for one, cannot wait to tee it up at Sedgefield.
Last year’s tournaments raised over $10,000, which allowed us to sponsor two “wishes” for children with life-threatening illnesses. This year, we hope to do much better in the fundraising department. As this is our second time around we think we have learned a few things that will make this year’s events even better.
Once again, we have female touring pros for you to challenge. If you can out-drive them or hit it closer to the pin than they do on selected holes, you will win extra tickets you can use for a variety of raffle items including our grand prize of a one-week vacation for two. Also, like last year, the winning foursome will take a shot from 165 yards to try to win $1,000,000 for a hole-in-one. There are also prizes for closest to the pin on all four par threes, and, like last year, at each event one par three will yield a brand new Ford King Ranch pickup truck for a hole-in-one.
In the entertainment department, we will once again have a professional comedian and impressionist who will do a comedy show prior to MCing our charity auction. Remember that if you want to bring a guest to the banquet, you can do so for an additional $50. Information on how to sign up to bring a guest can be found on our website.
I hope to see all of you golfers at one or both of the events (some people had such a good time at our first event last year that they came to the second one as well!).
Click here to register for the Greensboro Tournament at Sedgefield Country Club and
Click here to register for the Columbia Tournament at Woodlands Country Club.
I also wanted to take this opportunity to let you know that our re-branding two years ago recently won an international award. Our identity agency, Brains on Fire, in Greenville, SC, entered our re-branding in an international competition. They submitted samples of our new logo, truck signage, store signage, caps / shirts, etc., to an international panel of judges. We were thrilled to hear that our re-branding was named one of the top 100 re-brands in the world last year.
Congratulations to Brains on Fire for their great work! To see more about this
click here.
This month, we are featuring the following suppliers:
- Hohmann and Barnard is one of the industry’s largest suppliers of masonry reinforcement, flashing, and accessories. They recently became part of the family of companies owned by Warren Buffet, and that gives them even more resources for future growth. To see more about their products, scroll down or visit their website.
- QC Construction Products is one of the most comprehensive suppliers of decorative concrete products. They are one of the pioneers in this rapidly growing part of the concrete business. They have a full array of stains, overlays, sealers, stamps, and everything else needed to take plain old gray concrete and make it into something exciting. For examples of their products, please see below or click here.
- Covalence House Wrap is a product that we get from PrimeSource with our logo on it. Please see the below picture of a hotel going up in Savannah, GA, with this product bearing our brand on it or click here to learn more. For pricing on their products, please contact any of our branches.
This month’s management article is entitled “Learn to Lead through Tough Times.” Given the current state of the economy, I thought this article would be timely and informative.
In closing, thank you for your continued support. Please don’t hesitate to let me know if you have any ideas for how we can do a better job of serving you.
Best Regards,
Jim
Jim Sobeck
President
(864) 325-6518
jim.sobeck@newsouthsupply.com
Learn to lead through tough times
by Chris Widener
What kind of leadership do you demonstrate during tough and challenging times? Weak leaders cause lasting damage. With extraordinary leaders at the helm, however, an organization can actually become stronger and thrive in spite of tough and challenging times. Those times become the platform for solidifying their organization and increasing business in the future. Here are some ideas on how to be an extraordinary leader in tough and challenging times.
1) Keep your eye on the big picture
When things get tough, everybody’s temptation is to become acutely focused on the problem. The extraordinary leader, however, keeps his or her eye on the big picture. This doesn’t mean that you don’t address the problem. In fact, you have to address the problem.
What separates a leader from a follower is that the leader doesn’t get caught up in the problem. The leader sees the big picture and keeps moving toward the vision. The further they take their followers toward the vision, the further away from the problem they get. Keep focused on the vision even though immediate problems scream for your attention.
2) Don't get caught in the war or in friendly fire
When it gets tough, even the most loyal team members can be tempted to start shooting and, unfortunately, they sometimes shoot each other. Rather than focusing on the enemy on the outside, they begin to question each other and find many faults with one another that they normally would not have seen.
Extraordinary leaders keep from being dragged into the fray. They keep their eye on the big picture and act rationally and objectively. They understand that in the heat of the moment people say things they don’t really mean. Extraordinary leaders understand this and rise above it. This way, they take fewer arrows and set the example for their followers.
3) Be first to sacrifice
When it gets tough, for example when salaries must be cut, the leader should be the first to sacrifice. The extraordinary leader says, “I know many of you are concerned with the salary cuts. I am too. In the long run we will be healthy again but in the mean time, this is necessary. Understanding this, I want you to know that I am taking a 20 percent pay reduction myself. I want you to know that we are in this together.”
The extraordinary leader is the first to sacrifice and will be rewarded with the loyalty of his or her followers. When a follower sees that a leader is willing to take the bad along with the good, they develop respect for that leader and are more willing to devote themselves to following and producing for that leader.
4) Remain calm
Panic is one of the basest of human emotions and no one is immune to it. Extraordinary leaders, however, regularly take time out to think issues through so they can remain calm. They remind themselves that all is not lost and there will be another day. They remind themselves that being calm enables them to make the best decisions for themselves and for their followers.
Panic only leads to disaster, while calm leads to victory. This is one of the distinguishing marks of a leader: They stay calm, stay the course, keep on moving and avoid panic.
5) Motivate
In tough and challenging times, people are naturally down. They tend to be pessimistic. They can’t see how problems work out. Thus, they have a hard time getting going. Extraordinary leaders know this and focus on being the optimistic motivator. They come to the office knowing their attitudes and actions will buoy the mood of the group.
It is the leader’s job to motivate, to provide “motive” for followers to keep their heads in the game and to keep the organization moving. If you can do that in tough times, you will be a master in good times.
6) Create small wins
One of the ways to motivate is to create small wins. The extraordinary leader knows that in tough times his or her people may think all is lost. They wonder if they can win. So, the extraordinary leader creates opportunities for the team to win, even if they are small. They set smaller, more achievable goals and remind and reward team members when they hit those goals.
With each small win, the leader builds the esteem and attitude of his followers, digging them out of their self-created hole of fear. Tough times usually provide losses for organizations. Those leaders who can keep their organizations on a steady track of incremental wins, even small ones, prove themselves to be extraordinary.
7) Keep a sense of humor
The extraordinary leader keeps perspective and knows that we humans act irrationally when we get scared and fail, and sometimes that is humorous. Don’t ever laugh at someone’s expense in this situation, because that will be perceived as cold and heartless. But do keep the ability to laugh at yourself and situations that present themselves.
We need to be able to laugh and enjoy life, even when circumstances are tough. Even when we are challenged by extreme circumstances, we can keep our sense of humor. This is what provides us with the joy of work and life.
Is it hard to be an extraordinary leader during tough and challenging times? Of course. But it is possible. Those leaders who are aware of the strategies that keep their organizations at the top even when downturns come step up and lead extraordinary organizations. While others fail, they see their organizations survive and even thrive. When good times come again, they will be positioned for even more dynamic and profitable growth for themselves and for the organizations they lead.
