New South Construction Supply eNews - July 2009

 

Dear Friends:

The best thing I can say about 2009 is that it’s more than half over! Most people I talk to in our industry say that their goal is to simply survive the downturn as those who survive will certainly prosper when things turn around as we will all have less competition. That’s our plan as well.

At this point, the stimulus plan has had no impact on our business that I can see. Perhaps it will kick in soon but, at this point, no one I have talked to in the Carolinas is telling me that they’re benefiting from it.

Several suppliers tried to get price increases around July 1, but most were unable to get the increases to stick. Despite that, several suppliers are trying for price increases again around August 1. While the lack of demand should dictate that prices won’t be going up in this kind of market, I understand that some suppliers have cut back production, so the price increases should take this time. For more specific pricing information please see below.

Despite historically low domestic and worldwide demand for construction materials, prices for some items, especially those manufactured from steel are on the rise. Scrap steel spiked by $60.00/ton on July 7th, due to increased demand by China and other foreign countries. This increase along with much smaller increases in May and June has resulted in manufacturers of steel construction products announcing price increases for August. Also, petroleum and natural gas resin manufacturers continue to raise prices and have announced another increase for August.

Gerdau Ameristeel, Nucor, and Steel Dynamics have all notified their distributors that they would increase the price for their August rebar rollings by $40.00/ton ($2.00/cwt) due to the spike in their scrap steel cost. As several rebar mills in the Eastern US have recently been shut down or “mothballed’ and manufacturers have cut production, little if any inventory at domestic mills is available for purchase until the August rollings. The August increase will result in rebar prices to the contractor increasing by approximately 10%. If you have any upcoming projects which require rebar, we recommend you buy out these projects as soon as possible.

Nucor and Gerdau Ameristeel also announced they will increase their price for all types of wire rod on orders shipped after July 31st by $40.00/ton. Charter, another large domestic wire rod manufacturer has notified their customers that they will increase prices by $60.00/ton for August orders. This increase is in addition to the industry-wide price increase of $20.00/ton that went into effect in July. Due to these increases concrete reinforcing wire mesh manufacturers have announced they will increase prices by 8 to 10% effective August 1st. Also, wire mesh manufacturers will not offer any job price protection. If an order is not released so that it can ship by August 1st, the higher August prices will be invoiced for the order. Although the industry attempted to increase prices in July, most rescinded their price increases due to weak demand. Most industry analysts believe that most if not all of the August increase will “stick”, so please be sure to factor in this increase when you are preparing your bids.

All three major masonry reinforcing manufacturers, Wire Bond, Hohmann & Barnard, and Dur-O-Wal, have indicated that they will increase prices by approximately 10% by mid-August due to their increased cost for wire rod. This will be the second industry wide increase of 10% in as many months. All three manufacturers have stated that they will only honor quotes for 30 days due to their rising cost for wire rod. As with rebar, we strongly recommend you buy out any projects you have that require masonry reinforcing as soon as possible in order to avoid the August price increase.

Extruded polystyrene insulation (trade names Styrofoam, FoamulaR, and GreenGuard) manufacturers have all announced an 8% price increase effective August 1st, due to their increased costs for resins. Resin prices have risen by over 30% since late March and another increase of $.05lb. is slated to take effect on August 1st. Because of the steep increases in resin cost, no manufacturers will offer job price protection for orders shipped after July 31st. Industry analyst predict that resin prices will continue to climb on into the fall, so expect extruded polystyrene prices to increase again later this year.

Polyethylene resin manufacturers have announced another increase of $.06/lb effective on August orders. This increase will be the fifth increase for polyethylene resins since January. Due to the July resin increase, which was noted in last month’s newsletter, polyethylene sheeting manufacturers increased prices in July by approximately 7%. They have also indicated that they will increase prices by 5 to 7% in early August due to the pending resin increase. Advanced Drainage Systems, the largest domestic manufacturer of polyethylene drainage pipe, and other domestic manufacturers, have notified their distributors that they will increase prices by another 5% on August 1st. This increase is in addition to the 5% industry wide increase that went into effect in July.

One bright spot is that after a 12% industry wide price increase for copper thru-wall flashings in July, raw copper prices have stabilized. Manufacturers do not foresee that a price increase will be necessary for the next several months.

This month we are featuring the following suppliers:

  • Emseal is a leading manufacturer of structural, watertight, fire rated expansion joint systems and sealants for seismic, parking, plaza, stadium, wall, foundation and floor joints as well as for component gasketing in log homes, precast buildings, metal roofs, vehicles and numerous other applications. For information on a revolutionary new product of theirs, please see their ad below.
  • M3 Distribution is a distributor and importer of a wide variety of concrete and masonry accessories. Their main distribution center is in High Point, North Carolina, so they can serve all of our markets very quickly. We found the quality of their products to be outstanding, as is their service. Please look at their ad below for more information about their company.
  • Right Pointe is one of the most diversified manufacturers of concrete chemicals and accessories. Not only do they have a top quality line, but their products are priced right for a tough economy. To see more about some of their products, scroll down.

This month’s management article is entitled, Three Keys to Leading through a Crisis. I hope that you will find this helpful in these trying times.

In closing, enjoy the fact that over half of this challenging year is over and let’s hope that the second half of the year somehow gets better despite all the dire predictions.

Sincerely,

Jim

Jim Sobeck President (864) 325-6518 jim.sobeck@newsouthsupply.com

This month we are featuring the following suppliers:
EMSEAL Joint Systems Ltd. is now offering two new UL tested and certified 2-hour fire-rated expansion joints. They provide a watertight, thermal and fire-rated seal in a single unit. One installation eliminates the expense, time and effort of installing a variety of products to create a fire-rated system. EMSHIELD DFR2 is a traffic-grade primary seal expansion joint designed for horizontal decks. EMSHIELD WFR2 is a dual-sided primary seal expansion joint for walls and vertical plane applications and is available in colors. Fire-rated, watertight expansion joints – One Install Does It All. These patent-pending expansion joints are available now from New South Construction Supply.

With over 20 years of industry experience, M3 is a manufacturer, importer and distributor of high quality concrete construction hardware, fabrics and tools. Though concrete construction hardware is our main focus, we also have experience in manufacturing and importing other product categories.

In addition to our highly successful Rodman brand of tie wire, M3 also furnishes rebar supports, forming and pre-cast hardware, OSHA rebar caps and a wide variety of other products. M3 also has many domestic and overseas manufacturing alliances that allow us to work with you on the development of new or custom products.


For more information call your local New South branch or visit them at www.rightpointe.com.

July's Management Article

Three keys to leading through crisis

"It is nearly impossible to remain both aloof and effective." ~ George S. Patton

Patton was right, and he walked his talk. In nine months and eight days his Third Army went farther, faster than any other army in history. Leaders today could learn from his example of staying visible, accessible and engaged during crisis.

Unfortunately, crisis often drives leaders behind closed doors instead of out to the trenches. They withdraw to their desk, get dazed by data, numbed by numbers and lose connection with their people, abandoning three key tenets of crisis leadership:

1. Stay engaged and lead from the front
In times of crisis, no news is not good news. Communicate constantly with your people. Tell the truth. Lead from the trenches and not from the rear, or worse, from your rear, polishing a chair with your behind whilst you wait for the storm to pass. 

The more time you spend at the front problem predicting, the fewer problems you'll have to solve. Shift your focus from charting results to charting the course. In the aftermath of Sept. 11, Mayor Rudolph Guiliani exhaustively pounded the streets modeling visibility and accessibility while he consoled, encouraged, listened, communicated, planned and executed strategy for rescue and cleanup. He attended more than 100 funerals, held daily briefings and consulted incessantly with others. He did not sequester himself in his office, reading reports, pondering budgets and digesting second-hand information.

Winston Churchill modeled engagement at the front during the blitzkrieg against London in 1940 by refusing to leave the city for Ireland or Canada, as was recommended. He lived in an underground bunker and resurfaced after raids to walk the streets, encourage, console and preach his message of inevitable victory. 

Another example of engagement during crisis occurred July 2, 1864 as the Confederate army approached Ft. Stevens in Silver Spring, Md., closing in on Washington, D.C. A high-ranking Union officer climbed the fort's parapet to personally survey the situation and came under fire from rebel snipers. 

This Union officer, was the commander-in-chief, President Abraham Lincoln who had left the safety of the White House and turned down offers to be whisked to the safety of Baltimore, opting to join his troops at the front, observe, encourage and chart the course. 

Lincoln had a track record of staying engaged and leading from the front. In prior years he visited several generals on battlefields: McClellan at Antietam, Hooker at Charlottesville and Burnside at Fredericksburg. The Confederate's advance toward Washington ended that day at Ft. Stevens.

Too many leaders dig deeper in their foxholes after crisis hits. They develop a bunker mentality and start playing not-to-lose instead of playing to win. This strategy ensures loss. In business, these leaders isolate themselves in their office trying to turn the numbers around when they should get out front and help turn the people around so the people can turn the numbers around.

2. Point to the big picture and communicate the vision
In times of crisis, leaders face the brutal facts of reality but never lose unwavering faith that they and their people will prevail. Giuliani never minimized the damage after Sept. 11, but at the same time maintained and conveyed uncompromising faith that New York and New Yorkers would triumph and emerge stronger than ever. 

Churchill did the same by repeating the vision of victory so clearly an entire nation became believers even while being pummeled by a Nazi army bent on their destruction and preparing a land invasion to finish them off. 

Lincoln's vision was crystal clear: preservation of the Union. And anyone doubting his resolve has only to look at the 600,000 casualties on both sides as testament to his determination.

Vision-driven organizations always have an advantage over their vision-less counterparts but when crisis hits, vision creates an insanely unfair advantage. Vision provides a big picture people can borrow inspiration from to get through the present trials and setbacks. 

In fact, working in a vision-less state is like trying to assemble a 500-piece jigsaw puzzle without being able to refer to the big picture. With no bigger picture-no vision-to keep you focused, inspired and persistent, your chore would quickly lose its meaning and you'd lose all motivation to continue. The same holds true when one becomes so overwhelmed by the pressures of the proximate. 

Without a larger sense of perspective, sense of meaning and sense of direction out of the abyss, people are immobilized and succumb to inertia. As the proverb writer penned, "Without vision, the people perish."

3. Seek wise counsel and use your team
In John Maxwell's book, The 21 Irrefutable Laws Of Leadership, his Law of the Inner Circle says those closet to the leader determines the leader's success. This is never so true as in crisis. It's at this time leaders need a team who can offer wise counsel, face and tell the truth; a team that challenges each other, engages in debate without coercion, conducts autopsies without blame and unites behind decisions once they are made. 

We can learn from Colin Powell who said:
"When we are debating an issue, being loyal to me means giving me your opinion whether you think I'll like it or not. At this point, disagreement stimulates me. But after the decision has been made, the debate ends. At this point being loyal means getting behind and executing the decision as if it were your own."

In crisis, a team of leaders with a balance of complementary skills and talents can move more quickly and effectively. This is where having developed capable, lateral leaders at all levels in your organization pays big dividends and often means the difference between survival and extinction. 

In fact, a hierarchy is the worst possible model in crisis and the organizations burdened by one will fail. The key is to be proactive and build your dream team before disaster hits. Why? Because tough times won't create leaders. They show you what kind of leaders you already have.

New South Construction Supply Locations

Main Office Shipping: 951 Harbor Rd West Columbia, SC 29169

Mail: PO Box 512 Columbia, SC 29202

Sales Managers - Jon Black, Julie Ham Operations Manager - Rodny Dahlgren 803.451.7027 Inside Sales Manager - Donald Whatley 803.451.7028 Product Sales: 803.791.8700 Accounting: 803.451.7045 Toll-Free: 800.849.6768 Fax: 803.791.8191 President - Jim Sobeck 864.325.6518 CFO - Kurt Herwald 864.268.3970 VP Purchasing - David Hodgin 704.358.9797 Director of Finance and Operations - Dave Lewis 803.451.7025

Other Locations

9 N. Kings Rd Greenville, SC 29605 Phone: 864.269.7007 Toll-Free: 800.849.4454 Fax: 864.269.6004 Operations Manager- Rob Hovanec Sales Managers- Russ Lott & Jey Yates

1427 Mechanical Blvd Garner, NC (Raleigh) 27529 Phone: 919.662.9012 Toll-Free: 800.849.4677 Fax: 919.662.9412 Operations Manager- Steve Freeman Sales Manager - Vic Murray

Other Locations

4987 Banco Road N. Charleston SC 29418 Phone: 843.760.0780 Toll-Free: 888.224.3140 Fax: 843.760.6127 Operations Manager- David Starr Sales Managers - Bailey Williams, Andy Rutledge

9050 D W. Market St. Colfax (Greensboro) NC 27235 Phone: 336.992.0237 Toll-Free: 800.609.0889 Fax: 336.992.0839 Operations Manager- David Perkins Sales Managers - Kearns Cheek

180 Rodeo Drive Myrtle Beach SC 29579 Phone: 843.236.6447 Toll-Free: 800.821.2676 Fax: 843.236.6521 Operations Manger- George Acerbi Sales Manager- Clint Paul

140 Dorton St Charlotte NC 28213 Phone: 704.358.9797 Toll-Free: 866.375.9660 Fax: 704.358.9646 Operations Manager: Adam Kent Sales Managers: Chris Daleus, Rick Bunch, Julie Ham, Angie Puckett

358 Industrial Park Rd Hardeeville (Hilton Head) SC 29927 Phone: 843.784.1580 Toll-Free: 866.326.8802 Fax: 843.784.1581 Operations Manager - Artie Helmey Sales Managers- Steve Melton, Ray Bryant, Nick Turner