22 Jan January 2018 Newsletter
The cold weather hasn’t slowed down the pace of price increases we have been seeing as of late. See below for an in-depth look at pricing for the key products we distribute.
Worldwide prices for many raw materials such as steel, metal alloys, and resins, used in construction products continued to rise in January and more price increases are expected in the coming months. Scrap steel posted up by $32/ton in the Chicago Metals Exchange on January 8th, more than analysts expected, and globally prices posted up by as much as $50/ton on some foreign metal exchanges. Copper prices increased by over 13% over the past two months and stainless steel prices are up over 10%. Some manufacturers of construction chemicals increased prices recently citing increased raw material and transportation costs as the reason for increasing prices and other manufacturers are expected to increase prices over the next few months.
As was the case in December, domestic rebar mills did not wait until the price for scrap steel to post in January to increase prices. Nucor announced on January 5th a $40/ton price increase effective immediately and CMC, Gerdau Ameristeel, and other mills in the southeast announced a $40/ton price increase on January 6th. Many analysts expect domestic mills to increase prices again in February due the limited supply of imported rebar and because imported rebar brokers increased prices over 6% in January and offers for February are up by another 5 to 6%. If you have any projects that require rebar, we strongly urge you to buy out these projects in January to avoid paying higher prices in February.
As was noted in our December newsletter, masonry reinforcing, tie, and anchormanufacturers did announce a price increase which will take effect the first week in February and will increase prices by approximately 15% across the board for all steel masonry accessories. All orders placed prior to the effective dates of their price increases and special job quote orders must be shipped by the end of February. As with rebar, consider buying out any projects you have that require masonry reinforcing, ties, and anchors as soon as possible.
SpecChem, LLC, one of the leading manufacturers of construction chemicals, epoxies, and concrete repair products increased prices on January 2nd. The amount of the price increase varied by product and ranged between 2 and 15%. SpecChem also implemented a $150/truckload fuel surcharge for all truckload orders citing increased freight and transportation costs.
Prime Resins increased prices across the board on January 2nd by 5% on their entire line of epoxies and urethane grouts citing recent increased raw material costs.
Quikrete Construction Products announced a 3% across the board price increase effective February 1st on their masonry cements, mortar mixes, Portland cement, and concrete repair products.
Several manufacturers of copper and stainless steel thru wall flashings announced they will increase prices in February due to the spike in the price of metal alloys over the past two months. The amount of the price increases will range between 5 and 7%. If prices for metal alloys continues to increase for the remainder of the first quarter, as most analysts predict, thru wall flashing manufacturers have indicated they will increases prices again by the first of April.
Simpson Strong-Tie announced on January 2nd that they will increase prices on all mechanical anchors by 3% on February 2nd. As with other manufacturers who have increased prices or recently announced a price increase, rising raw material cost was cited by Simpson as the primary reason for their price increase.
Manufacturers of light weight concrete block, concrete lintels, and concrete brickeither increased prices in January or announced a price increase for February due to their increased costs for cement, freight, and labor. The price increases will range from 9 to 12% depending on the product.
The producer price index (PPI) for final demand in December, not seasonally adjusted, decreased 0.3% from November but increased 2.6% year-over-year (y/y) from December 2016, the Bureau of Labor Statistics (BLS) reported on January 11. 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.
Producer of construction films – poly, vapor barriers, and liners
Innovations in Architectural Weatherproofing since 1862
The world’s largest producer of tubes, cores, and fiber concrete columns
Our Associate Profile this month is of Eric Federspiel, our waterproofing specialist who is based out of our Columbia, SC branch. Eric was born in Indianapolis and graduated from Carmel High School. He then received his B. S, degree in Industrial Engineering at Purdue University. He and his wife Cindi have two children and two stepchildren. When not working Eric enjoys camping, hunting, gardening, and cooking. Eric joined us last September after owning Applied Coating Systems for 25 years. We have quickly seen that our customers appreciate getting product advice from someone who has walked in their shoes for so long. If you have any waterproofing product needs give Eric a call and you will quickly see that he is an expert in this field.
Many of you requested that we put the Sales and Leadership Team on our website so we have done that. Go to our homepage (www.newsouthsupply.com) and click on Meet Our Team and you will see a photo and brief biography for each sales and management team member.
Our management article this month is titled, The Primary Reason Millennials Quit. As older guys like me are retiring we are getting more and more millennials in our businesses. This article has great information about why millennials quit so that you can keep from losing the millennials on your staff.
January’s Management Article
The Primary Reason Millennials Quit
by Jeremy Chandler
So if a lack of freedom or meaningful work isn’t the primary frustration for Millennials, what is?
In one word: mentoring.
According to this study from Deloitte, Millennials who leave their job within two years cite being unhappy with how their leadership skills were being developed as the primary reason. At the same time, those intending to stay with their organization for more than five years are twice as likely to have a mentor than not.
The study goes on to cite that creating loyalty with Millennials is primarily based on understanding and supporting their career and life ambitions. They want to be known and invested in, not just for what they can do to impact the bottom line of the company, but for the dreams and goals they have for their life. That requires a relationship.
How to Infuse Mentoring into Your Organizational Culture
So how do you go about creating a culture of mentorship to increase loyalty among Millennials? Here are a few principles to consider:
1. Develop Systems that Support It
Mentoring takes intentionality. People aren’t naturally looking to mentor other people. You can’t simply say, “we should do a better job of mentoring Millennials” without setting up systems that support it.
Creating a culture that values mentoring doesn’t have to be complicated. While some organizations create a robust mentoring program, it could be as simple as hosting a brown bag lunch once a month, or allowing older employees to leave a couple hours early to take another Millennial employee out for a drink after work.
2. Help Older Employees Realize They Have Something Valuable to Contribute
One of the primary excuses I hear from older people as to why they don’t mentor someone is because they don’t think they have any valuable wisdom to impart. That’s nonsense. Even if your career has seemed to take more ups than downs, you have a perspective that would be incredibly valuable for Millennials to know.
3. Encourage Millennials to Fail
In most cases, we learn more from our failures than our successes. But a lot of Millennials I know are afraid to take risks that might cause them to fail. Encouraging Millennials to take risks and helping them navigate through unknown situations is an incredibly valuable way to create loyalty with us. This is another reason why knowing how to provide productive criticism to Millennials is so important.
Counting the Cost…
The idea of creating a culture of mentoring might seem like another reason why managing our generation is so difficult. But I think it’s not unique to our generation. The concept of mentoring Millennials (or lack thereof) is just the latest iteration of the truth that “people leave managers, not companies.”
Infusing the concept of mentoring into your company culture is difficult work. It’s a lot more difficult than buying a Nespresso machine for the office. It’s far easier for a leader to say, “Millennials just need to get over it, show up to work and do their job.”
However, mentoring Millennials not only improves retention in the short run. There’s something bigger to it. While you might start investing in Millennials to prevent the short term turnover costs, what you might find is that doing so creates a lifelong impact on the people you lead. And that kind of legacy is a lot more valuable than the 213% you save.
In closing, stay warm and join us in hoping that it warms up soon. The economy is doing great so the wind is at our backs. We just need the warmer weather to arrive quickly.
Author of The Real Business 101: Lessons From the Trenches
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