March 2020 Newsletter

March 2020 Newsletter


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New South News

Dear Friends,

As I compose this letter, we are operating under COVID-19 guidelines, but we are open, and business remains very strong despite the health crisis and a lot of rain in the southeast. I appreciate your understanding of the new procedures we have put in place to keep you and our associates safe during these unprecedented times. Hopefully, this crisis will end sooner rather than later, and our normal lives will resume. Until then, thank you for your understanding.

Below is a look at current product pricing trends:

While the virus pandemic has caused a global crisis, surprisingly there has not been much impact on commodity pricing at this time. Scrap metal posted sideways at $277 per ton on March 11th, matching the same number posted in early February. With how volatile the economy has been lately; we do not expect any major movement up or down on pricing at this time. Mills are holding steady where they are and are waiting to see how the crisis will impact consumption. Rebar production continues unabated and the three major mills in our markets have ample stock. Corresponding lead times for material deliveries have been also been consistent. Most sizes and lengths are operating at roughly a week’s lead time from time the order is placed. We also have not heard of any/pending shutdowns or mill closures at this time. Some of the jobs that can be done remotely have shifted out of the office, but product production at the mills is still in full swing. Things can always change quickly in times like this, but for the last month, rebar pricing, production, and delivery have been holding steady. 

Wire mesh reinforcing is following the same pattern. Prices have held steady for the past month and look to continue that trend moving forward. The wire mesh mills are operating and producing at full capacity, with sufficient stock on most sizes, and ready to ship as orders roll in.

Lumber may be the most impacted commodity from the recent crisis. Many major SYP mills have already shifted some work remotely, with a few others set to follow in the next few weeks. Curtailment announcements have begun and there are expectations of more to follow. This is going to impact lead time and availability substantially over the coming months. Pricing levels for most 2x lumber has already started to increase. We are not seeing a substantial increase in price yet, but we are seeing lead times stretching out beyond three or four weeks. As the supply gets tighter, I would expect to see prices increase as well. #2 grade lumber is currently more readily available that other sizes with #3 being harder and harder to find.

We only received one price increase notice in March, and it was from Gates and Sons Concrete Forms. On April 1, 2020 Gates will be implementing a 6% increase on all products across the board. Increased operating costs, transportation costs, and raw material costs were the cause for the increase.

On March 12, BLS posted producer price indexes (PPIs) for February, calculated from prices gathered in early February (before most impacts from coronavirus). AGC posted tables showing PPIs relevant to construction. The y/y rate of price increase slowed compared to a year earlier for both inputs to construction (up 1.6% y/y from February 2019 to February 2020, vs. 2.4% a year earlier) and new nonresidential building construction (up 3.9%, vs. 5.2% a year earlier.

Click here for the latest update on the construction economy from Ken Simonson, the chief economist of the AGC.

INTRODUCING: “Catching up with our Customers”

New South Construction Supply is proud to launch “Catching up with our Customers”, a new monthly series where NSCS will highlight our featured customer of the month on our newsletter, website and social media communities. Here at New South Construction Supply (NSCS), we are invested in ensuring our customers are satisfied and are taken care of. Whether our customer is a small, local business or a large, national company, we run our business for the convenience of all customers — not ours. We look forward to hearing your feedback on this new series and welcome any recommendations for the next customer of the month.


 

Setting a Goal and Following Through

Takeaways From Victoria “Vicki” M. Simpson, Owner of Capitol Decorative Concrete

A Mill Village, piano performance and concrete construction: have you ever heard these three phrases in the same sentence? Chances are, probably not unless you know Victoria “Vicki” M. Simpson, the owner of Capitol Decorative Concrete.

Vicki is a long-time New South Construction Supply (NSCS) customer who buys decorative concrete color, stains, sealers, stamps, and other products from NSCS that allow her to take plain concrete and make it into an incredibly creative and perfect work of art. She works every day with the vital help of Dean B. Nash. Without Dean’s critical help, she couldn’t do all of her work. With more than 30 years of experience in the decorative concrete industry, Vicki credits the skills she gained from her mill village and piano performance background with developing her into the leader she is today.

Vicki grew up in Greenville, SC in a close-knit mill village, where she first learned about pitching in, helping others and the importance of following through. “Everyone was like family”, she said, and if her dad was out working and they needed something fixed at the house, no matter what, someone would come by and help resolve the problem at-hand. “Neighbors would follow through to ensure the family was taken care of — everyone looked out for each other”.  Vicki’s mill-village childhood, mixed in with growing up playing piano and attending North Greenville University for Piano Performance, shaped her into learning the valuable lessons of discipline, perseverance, and creativity — and most importantly, setting a goal and following through with it.

Fast forward to 2020, Vicki is now one of the nation’s top leaders in decorative concrete. For the past three years, her business has won the Grand Prize for Decorative Concrete at the World of Concrete from Sika/Scofield, the largest manufacturer of decorative concrete products.

Implementing a hands-on approach, Vicki is on every job site and cares greatly about the work product she is producing, especially since you only get one chance to do the concrete job right. When she’s not on-site, she’s waking up daily at 5:00 am to start responding to emails, getting out bids and working with customers. If Vicki doesn’t embody the #KnowHowCanDo spirit we expect of all our associates, we don’t know who does. 

We invite you to read the full Q&A below to learn more about Vicki, Dean and Capitol Decorative Concrete. You can email Vicki if interested in working with her, and her extensive portfolio is found by visiting her Flickr account. Estimates are always free, and she will meet with her customers in-person or over the phone — whatever is easiest for them.

READ THE FULL NSCS Q&A ONLINE HERE.
 


Featured Manufacturers

 

Euclid Chemical

Makers of Chemicals and Aggregates for the Concrete Industry

 

Simpson Strong-Tie

Connecting systems for wood, steel, masonry, and concrete

 

Sika Scofield

The #1 Ranked Brand Name in Decorative Concrete Color, Texture and Performance Systems

 


Associate Profile


Trey Couch
Operations Manager, Tucker GA

Our associate profile this month is of Trey Couch, Operations Manager at our Tucker, GA (Atlanta area) branch. Trey was born in Athens, GA and graduated from Apex High School in Apex, NC. From there he went to Methodist University in Fayetteville, NC. He and his wife, Amanda, have two children, Makayla (12) and Brayden (10). When not working he enjoys golf and watching his children play sports. Prior to joining us in March 2019 Trey worked at ABC Supply, Spec Building Materials, and Beacon Roofing Supply. Trey brought a lot of building material distribution experience with him, so he hit the ground running and hasn’t stopped.

Our Leadership article this month is entitled, “What to Ask Your Banker Amid Virus Concerns”. Given that we are in the midst of very unusual circumstances it’s never been more important to stay in close touch with your banker as he or she controls the lifeline to your business….access to cash (unless you have no debt, which is rare). If you have no debt you can skip this, otherwise I think this short article is worth your time.
 


 

What to ask your banker amid virus concerns

By Matthew Kish

Columbia Bank’s Scott Bossom has nearly two decades of experience working with small businesses. As the economic damage from the coronavirus outbreak spreads, the Business Journal asked Bossom how small business owners can navigate a suddenly chaotic business landscape.

Bossom works as a senior vice president overseeing Columbia Bank’s small business efforts. He previously worked for the U.S. Small Business Administration. He answered questions by email:

What can small business owners do to mitigate the impacts of coronavirus? First and foremost, this is a time for calm and thoughtful planning and response. Your core management team should meet frequently and determine the ways in which you can continue to serve customers while considering important steps like social distancing. Communicate with employees daily to explain any policy changes and developing public health recommendations. Follow guidance from the CDC, as well as state and local health authorities.

Specifically, regularly communicate the importance of proper hand washing and environmental cleaning; staying home while sick, postponing large gatherings etc. Implement flexibility where possible. This can include enabling employees to work from home, rapid response communications for customers, temporary adjustments to sick leave polices and more. And very importantly, step up your outreach to clients – let them know you are concerned about them and are available to help them navigate this challenging time.

What conversations should small business owners be having with their banker and what SBA programs can help small business owners? Talk to your banker about short- and medium-term products and strategies to help your business weather this storm. Notably, the federal government just announced a plan to empower the Small Business Administration to make significant funds available in low-interest loans to small businesses affected by the coronavirus pandemic. Details are still being ironed out, but an SBA banking expert can help expedite applications for emergency SBA loans and assess other near-term credit needs.

There are also SBA loans that businesses can pursue through its 7a program and further enhancements to that product may be made during this crisis including higher guarantee’s, fee waivers and other ways to increase access to capital. SBA also supports free advising and counseling resources that could help clients navigate these times which are deployed by the Small Business Development Center and SCORE. 

What options exist that might not be top-of-mind with business owners? Look for opportunities within the challenge. For example, might this crisis provide a key learning experience for your operation about a more remote workforce in the future? This is a chance to assess what you have that works and what tools you may need to acquire: For those who can work remotely, for example, do they have laptops and high-speed Internet connections, as well as access to collaboration tools such as Slack or Microsoft Teams?

Look for creative ways to continue your supply chain during this time of social distancing, including greater use of home delivery (vs. in-store pickup). Encourage all employees to be thinking about services that your company may be able to provide to customers affected by the virus outbreak.
 


In closing, I’m reminded of the old Chinese saying, “May you live in interesting times”.
I, for one, wish they were a lot less interesting. Let’s hope we get back to normal soon.

Best regards,

Jim Sobeck
President & CEO 864-263-4377 (Direct Line)
jim.sobeck@newsouthsupply.com
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Author of The Real Business 101: Lessons From the Trenches
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