October 2017 Newsletter

October 2017 Newsletter

We are well into the last quarter of the year and into budgeting season. To help with our budgeting we reviewed every 2018 forecast we could find. The consensus is that 2018 will be another good year but it may be the last “up” year before a cyclical downturn.

Dear Friends,

We are well into the last quarter of the year and into budgeting season. To help with our budgeting we reviewed every 2018 forecast we could find. The consensus is that 2018 will be another good year but it may be the last “up” year before a cyclical downturn. This sounds about right to me unless Congress passes a major tax cut and we see a major repatriation of cash stashed offshore by US based companies, in which case this bull market could get a second wind.

Price Updates

Price increases have moderated a bit of late. For a detailed look at pricing trends for the key products we sell just scroll down.

Unlike August and September, few manufacturers of construction products we distribute increased prices in October; however, several announced future price increases. To most analysts’ surprise, the price for scrap steel in the US moved down by $30/ton in early October as demand was less than projected in September. Resin prices stabilized after spiking  in September, but are still approximately $.10/LB higher than in August. Unlike most years some manufacturers of construction chemicals  will increase prices in November and December, instead of in January and February as they usually do, as raw material costs have increase substantially over the past few months.

Concrete reinforcing wire mesh prices have been unchanged since the industrywide price increase in September and mills are holding the line on the higher prices. Wire rod manufacturers were unable to get an increase in October and none have announced a price increase for November, so concrete reinforcing wire mesh prices should hold at current levels through November.

BASF Construction Systems announced on October 6th that they will implement a price increase effective November 6th on their entire line of construction chemicals, waterproofing items, sealants, concrete repair products, and floor hardeners. The amount of the increase will vary by product and will average 5% across all product categories. If you are bidding any projects that specify BASF products be sure that you get a current quote from your New South sales representative.

Pecora Corporation announced on September 30th a 6% price increase effective November 1st on their entire line of silicone, urethane, latex sealants, and waterproofing products. Increased raw material and transportation costs were cited by Pecora as the reason for the price increase.

Domestic rebar prices were unchanged in October after spiking in August and September. As the price of scrap steel moved down in October, domestic mills normally would not try to increase prices in November, however; some representatives of domestic mills have indicated that due to increased cost in other areas, that they may increase prices in November. Demand for domestic rebar continues to remain strong in the southeastern US as the supply of less expensive imported rebar continues to decline. If demand does increase in November, expect domestic mills to increase prices sometime in November. 

SpecChem, LLC notified their distributors that they will increase prices in late November or early December. They have not determined the exact amount of the price increase but it is expected to be between 2-5% depending on the product. SpecChem implemented a fuel surcharge of $150 for truckload orders effective October 11th, due the recent spike in freight and transportation costs.

Holcim / Lafarge announced on September 20th that they will increase prices on their entire product offering on April 1, 2018 as follows; Bulk Cements $10.00/short ton, NewCem $10.00/short ton, Portland Cement bagged products by $.45/bag, and bagged Masonry Mortar Mixes and Cements by $.35/bag. Due to the early announcement, they will not price protect any projects after April 1, 2018. As of the date of this newsletter neither Argos, Giant, nor Roanoke have announced they will increase prices, however; they are expected to announce a like price increase in the next few weeks.

The producer price index (PPI) for final demand in September, not seasonally adjusted, increased 0.4% from August and 2.6% year-over-year (y/y) from September 2016, the Bureau of Labor Statistics (BLS) reported on October 12AGC posted tablesand 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.

Featured Manufacturers

Euclid Chemical

Maker of chemicals and aggregates for the concrete industry



Quality construction chemicals for the concrete industry


Wire Bond

Innovation in Masonry Construction

Associate Profile

Clint Rose

Our associate spotlight is on Clint Rose this month, our Operations Manager in Charlotte. Clint was born in Las Vegas and graduated from Washburn High School in Tennessee. He earned his Bachelor’s Degree in the Applied Science of Business Management at the University of Tennessee in Knoxville. He and his wife, Casey, have one daughter, Hadalynn Rose. Prior to joining us Clint worked for Donahuew Contracting, O’Reilly Auto Parts, and 84 Lumber. In his down time Clint likes to restore classic cars, hunting and fishing, traveling, and spending time with his family. Clint’s presence was quickly felt when he joined our Charlotte team.

Our management article this month is titled Bad Leaders Will Drive Away Your Talent. Do you have any bad leaders in your company? If so print this article and leave it on their desk when they’re at lunch. (Kidding, not kidding.)




Bad Leaders Will Drive Away Your Talent
By Steve Keating

One of the main responsibilities of a leader is to fire their people! Not actually fire them but fire them up.

Fire them up as in motivate them, challenge them, coach them, help them grow and help them succeed, again and again. If you’re in a leadership position and you’re not doing those things on a daily basis then you are simply not leading.

If you’re in a leadership position and you’re not actually leading then you’re hurting the people you’re supposed to be helping. You’re also not helping the organization that has placed you into that leadership position and provided you with the opportunity to lead.

Don’t make the mistake of assuming that your position makes you a leader. The only thing, the one and only thing that makes you a leader is leading. If you find yourself in a leadership position while lacking the skills required to truly lead then it is YOUR responsibility to seek out the help and training that you need to be a successful leader.

Don’t wait for someone else to make you a leader, don’t expect the help you need to come to you. If you’re going to lead others then you must first lead yourself so lead yourself to the coaching you need to become a true leader.

If you’re following someone in a leadership position who lacks the skills to lead then you have three choices.

You could just complain about it. You could point out their failings at every opportunity and become a drag on the entire organization. I’ve done that and it didn’t really work out well for anyone, especially me.

You could, and should, attempt to lead up. By that I mean help fill the gaps of the person who is supposed to be leading you. You’ve no doubt already identified those gaps so try to use your own strengths to minimize the challenges those gaps cause within your company or organization.

I’ll warn you that you may not get the recognition you deserve for leading up. Some people in your organization might even call you a suck up or worse. Even the person who is supposed to be leading you may be a bit leery about your motives but you’ll be doing the right thing. I can say with a high degree of certainty that doing the right thing will eventually pay off; it might take longer than you want but you can’t go wrong by doing right.

The third option you have is to flee. Just leave, go find employment elsewhere. This is not as good an option as it may seem. While you left a problem behind you have no guarantee that you’re not just walking into another one. You also slow your own development by just leaving when the going gets a little tough.

You may get lucky and join an organization that provides you with a true leader who works hard to develop and mentor you. If that’s the case then you’ve truly struck gold. The problem I have is with the luck part; I simply don’t like depending on luck for my success.

I think most successful people would tell you that they made their success, they didn’t just luck into it.

So I’ve written a bit here to leaders and the people who would follow them. I also want to say something to a third group. That would be the folks who put people who can’t lead into leadership positions.

The truth is most organizations were able to “get away” with that for a long time. There used to be plenty of followers to go around and if an organization lost a few here and there they just plugged in some new people.

Not anymore!

One of the key considerations an organization must make these days is who is leading who. If you have good young talent being led by a non-leader in a leadership position that good young talent will leave. That’s not a guess, that’s not a maybe, they will be gone, period. And they are getting harder to replace by the day.

Whether you’re in Human Relations or another senior position within your organization, if you’re responsible for placing people into leadership positions then you better make sure you’re putting actual leaders into those positions.

There is almost no bigger waste in business today than giving a bright, motivated potential superstar in your organization to a person in a leadership position who lacks the ability to help that bright, motivated individual achieve success.

There will always be some leaders who are better than others. You need to be certain that your best people are being led by your best leaders. That’s the reality of the business world in which we live today; no organization can afford to have their top people led by people who are not leaders.

You may want to consider dealing with it before it’s dealt with for you.

In closing, we hope you have a great fall building season and, as always, thank you for your business.

Best regards,

Jim Sobeck
President 864-263-4377
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Author of The Real Business 101: Lessons From the Trenches
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