New South Construction Supply eNews - May 2009

 

Dear Friends:

As I write this letter in late May there are some signs that the economic bottom has been found but no major upturn in the economy is apparent at this time. When housing starts were announced on May 19, a new record low in housing starts was reached: 458,000 annualized starts. There is simply still too much housing inventory for the industry to begin a recovery. Despite an uptick in the sale of homes due to the large number of foreclosed homes which have recently been sold, there is still over 12 months’ inventory of housing available for sale. Until that number is worked down to the four-six month range there will be no sustained recovery in housing.

Commercial construction is still in the doldrums as well. Due to oversupply and much stricter lending standards, private commercial development is very low. Public construction is off a bit but is still keeping the industry alive. There is a decent amount of work to be had, however there are too many companies fighting over a shrinking pie. Customers of ours tell me that where there would be three-five bidders on a school job a year ago, now there are as many as thirty. Those companies that have downsized and are being aggressive and creative will survive, however I read recently that as many as 30% of construction companies may go out of business before this contraction ends.

Commodity prices are still volatile and many increases have been announced despite the slowdown. See below for more specific information about the major product lines we sell:

As reported in last month’s newsletter, indications are that the continued price decreases for many construction materials that have occurred over the past several months may be at an end. Worldwide demand for commodities, especially by China, has increased over the past two months, which has caused prices for scrap steel, crude oil, natural gas, and metals alloys to increase in late April and early May. Due to the increased cost of these commodities, several manufacturers of construction materials have announced price increases or have indicated they will increase prices in the coming months.

Despite continued weak domestic demand, Gerdau Ameristeel announced on May 13th that they would increase prices for June rollings for rebar by $40.00/ton. Nucor followed with their own announcement on May 19th that they would increase prices for June rollings by $20.00/ton. Both cited that the price of scrap steel had increased by nearly $50.00/ton since the end of April. Other domestic mills are expected to follow Gerdau Ameristeel and Nucor’s lead with price increase announcements of their own. As scrap steel prices are expected to increase more in June, many industry analysts expect rebar prices to increase again in July. Consider buying out any upcoming projects you have that require rebar in May to avoid the prices increases.

Although copper prices have risen by over 50% since early 2009, thru-wall copper flashing manufacturers did not increase prices in May, due to continued weak domestic demand and none have announced that they will increase prices in June. Although manufacturers continue to “hold the line” on prices, it is expected that prices for thru-wall copper flashings will increase in late June or early July, as the price of raw copper continues to rise.

Polyethylene resin manufacturers have indicated they will increase prices by $.05/lb for June orders. Increased demand for polyethylene resin by the packaging industry in China and the rising price of natural gas has contributed to the price increase of resins over the past few months. Due to their increased cost for resins, domestic polyethylene manufacturers have indicated they will increase prices by approximately 5% in June.

Masonry reinforcing and tie prices have remained unchanged for several months. With the current low domestic demand, manufacturers have indicated that prices will stay at current levels in June and July. Although manufacturers do not plan to change their prices for the next two months, if wire rod manufacturers increase their prices due to the rising cost of scrap steel, masonry reinforcing manufacturers may increase prices in late summer.

Construction chemicals, many of which are petroleum based, have either held steady or decreased slightly since late 2008. With the recent run up in crude oil prices, manufacturers of raw materials for petroleum based construction chemicals have increased recently. With the price of crude oil expected to continue to rise over the coming months, many manufacturers of construction chemicals have indicated they may have to implement price increases this fall, if their costs for raw materials increase further. Please be sure to factor in the possibility of price increases for construction chemicals as you are preparing your bids.

Concrete reinforcing wire mesh prices fell slightly in early May, as domestic demand continued to be weak. Most concrete reinforcing wire mesh manufacturers indicate that prices have hit bottom and future price reductions are not expected for the next several months. As with masonry reinforcing prices, if wire rod manufacturers increase their prices because of their increased costs for scrap steel, concrete reinforcing wire mesh manufacturers may increase prices in late summer or early fall.

The latest PPI charts and tables have been released. Click here for the tables and here for the charts.

This month we are spotlighting the following suppliers:

  • L.M. Scofield is the undisputed leader in decorative concrete products. They have a full array of stains, stamps, sealers, and other related products. The next time you have a job that calls for decorative concrete, please think of us.
  • Hanes Geosyntheticsis one of the largest and most diverse suppliers of Geosynthetic products, such as filter fabric, soil stabilization products, silt fence, and many other products used on all types of jobsites. For more information about their product line, please see below and remember to call us for pricing the next time you need any of their products.
  • ABT PolyDrain is one of the most recognized names in trench drains, and ABT®, Inc., is a world leader in surface drainage solutions. ABT products are now available at your nearest New South branch. Let us quote you on your next job calling for trench or surface drains.

This month’s management article is entitled, “Motivating Unmotivated People”. Motivating your employees is now more important than ever so I hope you find this article to be of value.

In closing, we’re striving to continue to give you superior service during these challenging times and we’re doing all we can to provide you with the most competitive prices as well. Thank you for your business and please don’t ever hesitate to let me know how we might be able to serve you better.

Sincerely,

Jim

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

This month we are featuring the following suppliers:

Surface Drainage, Containment, and Utility Ducts

PolyDrain®, the most recognized name in trench drains, and ABT®, Inc., the world leader in surface drainage solutions, provides engineered products to meet the complex requirements for wet processing, automotive facilities, industrial sites and storm water collection and filtration. PolyDrain® is manufactured with slopes ranging from .0% up to 40% sloped channels in 4 inch through 24 inch internal widths with a wide range of grates and frames to meet applications from Pedestrian to heavy Port and Airport applications. PolyDrain® is UL listed to meet NFPA codes. Located in Troutman, NC, ABT, Inc. products meet LEED credits as a local supplier along with many other LEED credit requirements.

ABT® also offers the Trench Former® system. Trench Former is a pre-engineered cast in place forming system available in 8 inch through 24 inch trench widths standard and as wide 36 inch custom. Frames and grates are available for everything f rom Pedestrian to Airport ratings along with solid covers for utility applications. Forms are available in radius or square bottoms and can be ordered in any slope needed to meet hydraulic requirements.

Visit ABT, Inc. at www.abtdrains.com

Now you can get liquid color on-demand with our new CHROMIX®-IT Color Center. High-quality CHROMIX® L Admixtures; the Number One Ranked Brand of concrete color; provide improved performance, consistent, permanent, fade-resistant, evenly dispersed, integral color for vertical or horizontal construction.

New SCOFIELD® Formula One™ Lithium Densifier MP is a high-quality, VOC-compliant lithium silicate concrete densifier capable of providing longer life and higher gloss for ground and polished concrete surfaces of all types. This superior formulation offers increased abrasion and water resistance, higher surface compressive strength, and reduced dusting, add in our Finish Coat and further reduce porosity and protection of surface.

Easy to use new SCOFIELD® Formula™ One Liquid Dye Concentrate is a fast-track, penetrating, translucent dye concentrate designed to add beautiful color to ground and polished, or uncolored interior architectural concrete, use also for a Stain and Seal project.

Visit Scofield at www.scofield.com

Supplies the construction industry with ground stabilization, erosion control, silt fence, t-posts, and geotextiles. Hanes is a proud partner of New South Supply since 1981.

Site Work Materials & Supplies | Geotextiles | Grass Seed | Turf & Ornamental Chemicals | Fertilizer | Landscape Fabrics | Erosion Control

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

May's Management Article

Motivating unmotivated people

by John Strelecky

If you walk around a Walt Disney World resort or theme park, you are likely to witness something that in most other settings would seem bizarre. Not the presence of a large animated character, although you may witness that. Rather, at any given moment, a person in dress clothes will be walking from one destination to another and will stop, pick up a piece of paper, a cup, or other piece of trash someone dropped, and throw it in a trash can. Executives do it; front line managers do it; hourly employees do it; everybody does it.

There is no special monetary compensation for this behavior. No point system exists where $5 bonuses are given out for every 15 pieces of trash someone picks up. There is also no special monitoring system in place that watches for people who don’t do it and then issues penalty points or demerits. Yet, people are motivated to do it anyway.

Now, picking up trash may not be your top concern, but are there other things in your department, division or company that you would like your employees to do? Are you looking for ways to motivate your people?

The answer is not pixie dust or magic. The key is being very good at employing five essential motivation steps.

To some leaders these steps seem intimidating. First-time managers in particular, who were promoted because of their individual skills are often uncomfortable with these ideas. Many times they feel people should just do what needs to be done “because that is what they get paid for.” Or, they believe the only way to motivate people is to give them more money.

Successful motivators don’t think that way. They know that by following the five steps, people can be motivated far beyond what they get paid for and far more effectively than when money is the only incentive.

Clearly articulate what needs to be accomplished and why
Often, the problem with getting people to accomplish things is not that they are unmotivated, it is that they are uninformed. Leaders discuss goals with their peers and superiors on a regular basis and are therefore intimately familiar with them. Because of this familiarity, they mistakenly assume all of their employees also know them. Usually this is not the case.

Take time to explain to all of your employees exactly what needs to be accomplished and the reasons why. Don’t forget the “why?” Knowing that enables people to make educated choices in their day-to-day decisions. For example, the output from a team at a market research company whose goal is to launch three new products will vary greatly depending on if they know that the “why?” is because the company is losing market share to competitors with products that can be downloaded from the Internet.

Goals should always include specific numeric objectives and timelines. A goal of “Improve Customer Service” is nebulous and people won’t know how they are doing in their efforts to achieve it. However, “Decrease customer wait times to 10 seconds by June 1” is something people can visualize and work toward.

Involve people in finding the solutions
People are more motivated to succeed at something if they personally choose to attempt it. Therefore, managers should involve their people in choosing the goals the group needs to accomplish. If this is not possible, then involving people in the creation of how to achieve the goals is the next best thing. Their involvement will generate buy-in and also opens up the opportunity for an optimal solution.

Successful coaches use this technique on a regular basis. While it is true they watch hours and hours of game films looking for weaknesses in their own team as well as their competitors, they also involve their players in finding the best way to win. They do it because no matter how much film they watch, or how close they are to the game, they aren’t in the game. The perspectives of players or employees who are in the midst of the action can be drastically different from a coach or a manager who is near the action.

If those perspectives aren’t incorporated into the solution, two things will happen. First, those in the midst of the action will feel that no one is listening to them, and they will become unmotivated. Second, decisions will be made without incorporating all the relevant data. Both of these will negatively impact progress toward the goals.

Explain the rules of the game
Have you ever played a new sport or game against people who are experienced players? In the early stages of learning how to play, every few minutes you do something which you think is correct only to be told that it is illegal or against the rules. It can be exceptionally frustrating.

This scenario often plays out in the workplace. Employees are given a task, but are not told all the parameters or rules. Weeks into a project they present their work to someone only to be informed that they need to change direction because of something they were never told about. This is particularly demoralizing and should be avoided at all costs. People can find solutions to almost any problem, but they need to know the rules of the game.

Link people’s personal goals with the organizations goals
There is a reason that each employee goes to work. Successful motivators know what that reason is for every person who works for them. Each day they help their employees fulfill those reasons. Really successful motivators understand not only the reason, but how the reason ties into the person’s bigger life goals. When necessary, they help their people think about and articulate those bigger life goals.

When a person no longer thinks “I work so that I can make money,” and instead thinks “I work so that I can enable my daughter to attend a school that will give her a chance to go do what she wants in life,” there is a significant mental and motivational shift that occurs.

Understanding that someone comes to work because they thrive on personal interaction, are trying to gain experience so they can run their own corner deli, or whatever is their personal goal, enables a manager to talk in that person’s language. It also enables the manager to assign responsibilities in that person’s area of interest, and remind them of how that which they are doing is tied to their bigger goals.

Managers who enable people to fulfill their life goals through work, never have to worry about how to motivate their people. The act of fulfilling their life goals is enough to keep them motivated. All the manager has to do is find the links between those goals, and the organization’s needs, and match the two up.

Move negative people off the team

Nothing can halt progress like someone who is discontent simply for the sake of being discontent. It is demoralizing to others and it draws energy and time from the tasks being attempted. That doesn’t mean you don’t want good counterpoint people on your team.

Someone who says “Look, I know what we are all trying to do, and I think there is a better way,” can be a valuable resource to help make sure the team is on the right track. However, someone who just regularly says “We’ll never get there,” will just hold everyone back. Move them off the team, and bring in someone who will assist and support the group’s efforts.

Whether you are trying to motivate people to help create a clean environment for guests, or something more pertinent to your organization, remember that anyone can be a great motivator. All it takes is an understanding of the appropriate steps to take and a willingness to do them. This article contains the steps. The willingness is up to you.

New South Construction Supply Locations

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

Mail: PO Box 512 Columbia, SC 29202

Sales Manager - Jon Black 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 Manager- Bailey Williams

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

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