August 2018 2nd Newsletter

August 2018 2nd Newsletter



August 2018 Newsletter

Dear Friends,

As summer winds down I hope the late afternoon thunderstorms that plague the south every summer will end soon. The red clay soil around most of our branches doesn’t drain quickly like the sandy loam around our coastal locations resulting in some job sites shutting down for several days a week this summer and some sites even had to be regraded due to all the mud.

The good news is price increases, which had abated of late, still continue to be less frequent than earlier this year. See below for more details.

As it was the case in July, few manufacturers of construction materials we distribute increased prices or announced price increases in August; however, a few manufacturers are now increasing prices for steel construction products as a result of the tariffs imposed by the Trump administration last spring. The increases are also due to domestic manufacturers implementing yet another price increase on wire rod and steel flats in August. One bright spot concerning steel is the price for scrap steel fell by $20/ton on the Chicago Metals Exchange in August, which may be a sign that steel prices will be stable this fall.

PNA Construction Technologies, a division of ITW, announced they will increase prices on September 17th on their entire line of Diamond Dowels, PD3 baskets, Armor Edge, and other steel products. The price increase will vary between 6 to 13% depending on the item. PNA will honor all quotes prior to September 17th provided the orders are shipped within 30 days of the date of the quote. If you have any projects that require PNA products, we strongly encourage you to buy out these jobs as soon as possible to avoid paying higher prices after September 17th.

As was noted in our July newsletter, prices for SYP lumber fell modestly in July. Most analysts predicted that demand would increase substantially in early August and it did. As a result of increased demand, lumber prices began to increase in mid-August and are now as high or higher than they were prior to the price decrease in July. Most analysts predict that lumber prices will increase each week in September and some believe this will continue into October. With the increased demand, lead times for mill direct truckloads for most sizes of dimensional lumber are now two weeks; however, lead times for some sizes, such as 2 x 4 lumber, are three weeks or more. Please consider buying out any requirements you have for SYP lumber as soon as possible, not only to avoid paying higher prices, but also to ensure you can have the lumber on site when you need it.

Domestic rebar prices were unchanged in August, despite strong demand and most mills rollings being sold out until mid to late September. With the price of scrap steel moving down in August and the continuing DOC investigation concerning alleged profiteering by domestic mills, most analysts expect domestic mills to hold the line on prices in September.

Both Hohmann & Barnard and Wire Bond will increase prices by 10% on masonry reinforcing, ties, and all other steel masonry accessories the first week in September. Both manufacturers cited recent price increases by wire rod manufacturers and steel flats as the reason for their September price increases. Both will honor any projects that were quoted prior to their August price increase announcements, provided the orders are shipped by September 21st. If you have any projects that a NSCS supply sales associate quoted and you have not bought out the job, please place your order no later than September 7th.

As many of you know, the US plans to impose a 10% retaliatory tariff on a broad list of items from China, which, if implemented, will go into effect on September 2nd. Iron or steel anchors, grapnels, and parts associated with these items are included on the list of items. Importers of construction products from China notified their customers that they will increase prices by 10% on or about September 2nd   for anchor bolts and other steel anchors if the 10% tariff is imposed.

The producer price index (PPI) for final demand in July, not seasonally adjusted, was unchanged from June and up 3.3% year-over-year (y/y) from July 2017, the Bureau of Labor Statistics reported on August 9. 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.

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Associate Profile

Our associate profile this month is of Mark Hollander, Waterproofing Specialist for the North Georgia market. Mark has been selling waterproofing products since 1990 and is well known in the industry. He was on the board of the Waterproofing Contractors Association and is a past president. Mark was born in Durham, NC where he graduated from Northern Durham High School. After high school he continued his education at Mt. Olive College. He has three children; John Michael (27), Ellen Elise (24), and Robert Alan (21). In his spare time he enjoys fishing, hiking, backpacking, reading, and spending time at the family cabin in the North Carolina Mountains. He also is restoring his 1986 Nissan 300ZX. Mark has been a great addition to our team as there aren’t many people in the industry with his depth of experience and contacts.

The management article this month is titled, “Be Specific When Giving Constructive Criticism.” Giving any criticism is hard but by providing specifics most people will accept it. Give this a read if you have this challenge.

August’s Management Article

Be specific when giving constructive criticism
By Gerry Valentine

Here’s an open secret of leadership — most leaders hate having performance improvement conversations with their employees. It’s never fun telling someone that their job performance isn’t up to par, and, in the most extreme cases, that they’re in danger of losing their job.

But providing corrective feedback is a fundamental part of how leaders deliver value to their organizations — it allows struggling employees to improve, saves recruiting and training costs, minimizes work disruption, preserves company morale and protects the business.

The good news is that constructive feedback conversations don’t need to be excruciating. Here’s a seven-step framework to have conversations that actually improve performance, and that set both the employee and the company up for success.

1. Start with the right assumption and intention.
The most important part of any performance improvement conversation is to start with the assumption that the employee is capable of improvement and with the intention of helping them improve. Avoid presenting the conversation as a reprimand. Instead, focus on the improvement needed. Clearly communicate job expectations, where those expectations are not being met and the corrective steps the employee needs to take.

2. Always include examples and specifics.
To be maximally effective, the conversation needs to include specific examples. Sometimes, in the heat of frustration, a leader will default to generalities like, “your budgets are always wrong,” or worse yet, “your work is sloppy.” But speaking in generalities creates ambiguity and decreases the likelihood of success.

The best performance improvement conversations include at least one instance where you observed sub-par performance and why it was relevant, what needs to change in order to meet expectations and a timeline for improvement.

For example: “In the past, the quarterly expense forecasts for your department have not been accurate. The forecast you gave last quarter was off by more than 25%. This is a problem because inaccuracies in your forecast impact the company’s overall earnings report. Going forward you need to provide numbers that are accurate to within 2%. This needs to be corrected on your next forecast.”

3. Confirm mutual understanding.
Always confirm that the employee understands your expectations. A good practice is to have the employee repeat back to you what they understand the expectation to be. Listen carefully for complete accuracy and make further corrections if necessary.

Remember, you are confirming understanding but not necessarily agreement with the expectation. Sometimes employees become defensive — they may challenge the expectation or attempt to deflect by criticizing others. It’s critical that you immediately bring the conversation back to the specific expectation, using a statement like: “Our purpose here is to talk about your performance and to make sure you understand my expectation. Do you understand that I’m looking for you to … ?”

4. Listen for legitimate blockers and take action if needed.
Separate from deflections, there are sometimes instances of legitimate blockers — issues beyond the employee’s control that prevent him or her from meeting the expectation. It’s important that leaders listen for legitimate blockers and take any necessary action. After confirming understanding of the expectations, a leader might ask a question like: “Is there anything preventing you from meeting the expectations I’ve outlined?”

The distinction between a deflection and a legitimate blocker can be subtle, and it might also be job specific. In the aforementioned budget forecast example, an employee might say that he or she lacks sufficient financial knowledge to produce an accurate forecast. For a recently promoted junior employee, you might decide to invest in training. However, for a more senior individual, gaining the required knowledge might be the employee’s responsibility.

5. Establish follow-up and communicate consequences.
The performance improvement conversation should always include how you intend to follow up on progress. For example, you might meet with the employee on a regular basis, such as weekly or monthly. It’s also important to include consequences of failing to meet the expectations. In the most serious cases, the consequence might be termination. Clarity on consequences ensures that there’s a common understanding of seriousness.

6. Act before it’s too late and create a partnership.
One of the biggest reasons performance improvement fails is because leaders wait too long to have tough conversations. Hesitation just creates more frustration, and it may even cause the employee’s reputation in the company to become irreparably damaged.

The best performance improvement conversations also create a sense of partnership between the leader and the employee — one where the leader enforces accountability but is also available to provide support and guidance. Ideally, conclude the conversation by expressing your hope that the employee will be successful and explain that you want to do everything you can to help.

7. If performance doesn’t ultimately improve, act quickly.
Sometimes, even with the best communication, support and partnership, performance doesn’t improve — that’s when the leader’s role becomes even more critical. When unaddressed, poor performers can seriously damage a company’s culture. Other employees will notice, especially ones whose work depends on the poor performer and who may have to take up the slack themselves. And if the poor performer is in a leadership position themselves, the negative effect is exponential.
Once all reasonable efforts have been made, it’s a leader’s responsibility to move forward quickly with remediation — whether that means a reassignment to a different responsibility, a demotion or a termination. Do not allow performance problems to fester. If an employee ultimately cannot meet expectations, it’s the leader’s responsibility to quickly protect the overall business.

That’s all for this month. As always, never hesitate to let me know how we can better serve you. Thank you for your business!

Best regards,

Jim Sobeck
President 864-263-4377
Connect with us: Twitter | YouTube | Facebook | LinkedIn

Author of The Real Business 101: Lessons From the Trenches
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