25 Apr April 2019 Newsletter
New South News
Spring has sprung and the construction industry is shifting into high gear with the onset of the prime construction season here in the South. However, prices increases haven’t shifted into high gear yet so now is a good time to lock in prices for your summer jobs. See below for a closer look on pricing.
Late March and early April brought one of the longest dry spells for the South this year so far. With that, construction really began to take off over the past few weeks. Backlogs have started to be released and the normal spring and summer construction business is beginning to get underway. With the increase in work and higher demand for materials, the main changes from March to April are availability and lead times.
Most commodity items stayed flat through March and into April. Lumber has also stayed relatively flat over the past month. Demand seems to be sporadic with busy weeks being followed by slower weeks. The inconsistency of demand for lumber has kept pricing stable through the past month. Mills are hoping that the spring season will help with demand consistencies and help keep stocking and production levels at seasonal norms.
Metal wire reinforcing again stayed flat through March and into April. Mills are still running with moderate stocking levels, but with the increase in demand over the last month, lead times are beginning to stretch out. While the mills still have stock available on the ground, the total quantity is not quite what they were coming out of the winter months. It is safe to say that leads times are now increasing by 4-6 days over where they were 4 weeks ago.
Scrap metal posted down to start April, countering the previous increase we saw in March. With raw material costs sideways and scrap pricing staying flat, the biggest impact on pricing this spring will be demand and availability. Domestic rebar mills pushed through a $20/ton increase in March and that increase looks like it will stick for the coming months with little chance rebar will see a decrease in the near future. Availability is now the main factor in play for rebar. High winter stocking levels have been decreased significantly and on-demand access to rebar is no longer the norm. Most domestic mills are able to fulfill the majority of orders coming in, but depending on size and quantity, some orders are being sold off of future rollings. With this, lead times are being stretched anywhere from 3-4 days to 2 weeks. Even with increased lead times domestically, import rebar is still not much of a factor domestically. There is little incentive to import rebar currently with the tariffs domestically and an increase in scrap abroad. Import brokers are being limited to spot buys while still trying to get rid of some higher priced inventory.
As in March, there were no other major price increases mentioned by manufacturers of construction material that have not been mentioned in previous newsletters.
The producer price index (PPI) for final demand in March, not seasonally adjusted, increased 0.7% from February and 2.2% year-over-year (y/y) from March 2018, the Bureau of Labor Statistics (BLS) reported on April 11. The AGC posted tables and an explanation focusing on construction prices and costs.
Click here for the latest update on the construction economy from Ken Simonson, the chief economist of the AGC.
Dow Performance Building Solutions
Premier supplier of insulations, air sealants and weatherization products
The integration of Dow and DuPont now offers industry-leading brands such as DuPont™ Tyvek® Building Envelope, STYROFOAM™ Extruded Polystyrene (XPS), THERMAX™ (ISO), LIQUIDARMOR™ Flashing and GREAT STUFF™ Sealants as part of one offering. These brands will house a better customer and user experience by providing easy-to-install systems that work together to enhance the building envelope and meet the market’s increased performance expectations.
DuPont PBS (Performance Building Solutions) knows how materials work together – Tyvek®, STYROFOAM™, THERMAX™, LIQUIDARMOR™and GREAT STUFF™ work hand-in-hand to improve water management, energy efficiency and thermal performance, resulting in a durable and energy-efficient building envelope. Customers can now use DuPont system solutions to help manage bulk water, tighten the building enclosure, reduce the wall condensation potential, and enable appropriate drying within the wall cavity. Insulation, permeable weather resistive barriers, flashing and seleants are used in effective combinations to improve energy efficiency, thermal comfort and durability of the building envelope.
Dupont will be offering moisture resistant warranties on the THERMAX insulation when Liquid Armor is used to seal the board joints the and window and door openings in the building envelope. This system serves as an air barrier and a weather resistant barrier
Thermax Xarmor and Liquid Armor= 15 year moisture penetration warranty
Thermax Ci and Liquid Armor= 10 year moisture penetration warranty
Thermax Sheathing and Liquid Armor=5 year moisture penetration warranty
Specializes in products that protect surfaces and structures from moisture, water and other undesired substances
Innovations in Architectural Weatherproofing since 1862
Our associate profile this month is of Joanie Allen, a sales representative working out of our North Charleston, SC branch. Joanie was born in Cumming, Georgia and she graduated from Lambert High School. She received her Bachelor’s Degree in Business Management from the University of North Georgia. Joanie is married with no children but has two cats named Smith and Wesson. Prior to joining us she was a project estimator for Exterior Expressions, one of our customers. She joined us in December of last year and is currently training with Bailey Williams. We’re looking forward to Joanie making a major impact in the Charleston market in the near future.
Our management article this month is entitled; The Best Leaders are Coaches, not Bosses. I picked up a lot of new ideas from this article I bet you will as well.
April’s Management Article
The best leaders are coaches, not bosses
By Dan Rockwell
“What ultimately constrains the performance of your organization is not its business model, nor its operating model, but its management model.” (The Future of Management, Gary Hamel)
Factors of organizational success:
Jim Collins says the key factors for success include:
- Getting the right people on the bus
- Getting the right people in the right seats.
- Getting the wrong people off the bus.
- Level 5 leadership – Humble leaders with indomitable will. (Good to Great)
“Gallup finds that the quality of managers and team leaders is the single biggest factor in your organization’s long-term success.” (It’s the Manager)
Organizations ask, “How do managers get more out of people?”
“Ironically, the management model encapsulated in this question virtually guarantees that a company will never get the best out of its people. Vassals and conscripts may work hard, but they don’t work willingly.” Gary Hamel
Boss to coach:
The BEST managers are coaches, not bosses. Jim Clifton and Jim Harter say there are three requirements of coaching.
- Establish expectations.
- Continually coach.
- Create accountability.
3 tips for shifting from boss to coach:
#1. Understand the dance between freedom and intervention.
Give high performers freedom. Intervene when performance lags.
Intervention isn’t oppression or punishment. It might mean weekly one-on-ones, instead of monthly.
#2. Overcome the most difficult shift.
Solving problems for talented people devalues their talent. Over-helpfulness sucks the life out of talented people. Stop giving quick answers.
Coaches help people find their own answers. The old style of management, when people were tools, is to give them answers and expect conformity.
#3. Practice accountability that energizes people.
Accountability that energizes is self-imposed. We need to rise above the false notion that we can force people into high performance.
Noticing is healthy accountability. Walk around noticing performance as it relates to expectation.
Work that isn’t noticed goes down in value.
That’s it for this month. I hope your business is booming and that you will think of us when you need quality building materials.
Author of The Real Business 101: Lessons From the Trenches
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