September 2019 Newsletter

September 2019 Newsletter


New South News

Dear Friends,

The weather and the economy continue to be good for the construction industry. While Hurricane Dorian definitely affected business in our markets the good news is that the Carolinas and Georgia were largely spared from any major damage. Also, the major construction economists are not calling for a recession in 2020; however, most forecasters are calling for a slight slowdown in construction. I will take a slight slowdown over a recession any day.

Unlike the last few years, price increases continue to be few and far between. For a more in depth look at product pricing, see below.

Rebar prices remained flat from August and we expect that to continue over the next month or two. Scrap metal prices began the month soft and posted in at $252 per ton on September 9th. This was down $30 per ton from August and negated the $30 increase we saw in August. The mills have not been following the decrease in scrap prices the past few months, and we expect that to continue to be the case through September. Availability remains solid with most sizes and quantities being available on demand and lead times have held strong at a week or two.

The same can be said on reinforcing wire mesh. Mesh continues to be very competitive with ample stock sitting on most of the regional manufacturer’s yards. Now is a very good time to make those wire purchases for existing jobs or jobs that may be starting in a month or two. Mills are looking to move as much volume before the cold of winter comes and are very motivated to move product.

As mentioned in last month’s newsletter, lumber has rebounded from the summer low. Pricing is moving back up from the bottom and we are seeing pricing increases on most species, sizes, and grades. The mothballing of several SPF mills earlier this summer has impacted both pricing for spruce as well as southern yellow pine. Since availability on spruce has tightened due to the curtailments, the demand for SYP has picked up, and thus resulted in elevated lumber prices on SYP. #2 grade in SYP seems to be in better supply than #3 grade. #2 grade has a rough lead time of 2 weeks, while #3 grade is seeing extended lead times being stretched out as far out as a month.

A couple of our manufacturers sent notice of pending price increases:

Zurn Industries, a leading manufacturer of trench drains, announced a price increase that becomes effective on October 1, 2019. The recently announced tariffs were listed as the main cause. All pending orders need to be registered before October 1st to protect current pricing. Any unregistered jobs that ship after September 30th, 2019 will reflect the new pricing.

Eagle Industries is also seeing strains from the new tariffs on products from China. These increased costs are not yet being passed on to customers but will certainly have an impact on pricing in the near future. The products with potential to see the most impact will be netting and reinforced poly products.

Contractors’ bid prices inched up 0.1% from July to August, while materials and services input costs dipped 0.2% for the month, based on an AGC analysis of producer price indexes (PPIs) that the Bureau of Labor Statistics (BLS) posted on September 11.

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

Nick Drake
Regional Sales Manager, Charlotte, NC

Our associate profile this month is of Nick Drake, a regional sales manager based in Charlotte. Nick was born in Akron, Ohio and graduated from Jackson High School in Massillon, Ohio. He then went on to receive a BA degree from Bowling Green State University. Nick is single and his hobbies include golf, football, baseball, and basketball. He also enjoys movies and reading biographies. Prior to joining us he was with Wayne Dalton Garage Doors for 14 years and most recently with Top Build. His volunteer activities include the Kiwanis Club of Charlotte and Habitat for Humanity. Nick has been a great addition to our team.

Our management article this month is entitled, Hired the Wrong Person? Here’s How to Clean Up the Mess. We all make hiring mistakes and I think this article will give you some good ideas about what to do once you realize you hired the wrong person.

September’s Management Article

Hired The Wrong Person? Here’s How To Clean Up The Mess

By Louis Carter

As I’ve said before, the office is a place for personal and professional development. These responsibilities cannot be selective.

Recently, I was asked the following:

“Dear Lou,

We have an employee who is not meeting goals and is constantly challenging and shooting down everyone’s thoughts in meetings. They never ask questions to clarify and have a hard time with nearly everything to do with our work. Lastly, they absolutely hate the company and its work. We are all beginning to wonder how we ever hired this person in the first place! To avoid conflict, we’ve tried everything from coaching and mentoring to team facilitation and one-on-one training and development. It doesn’t feel right anymore. What do we do?”

If you feel an employee is not willing to improve despite all efforts to make that improvement a reality, then you risk allowing that individual to drag the company down.

In this particular situation, where an employee has regularly made mistakes that they don’t seek to fix combined with a seeming hatred for all that you do, they may have stayed beyond their usefulness. Not everyone is going to be a great fit for your company’s needs.

You have the company’s reputation and many other people to be concerned about. A company is a collective working toward a common goal. That goal needs to be a shared experience, despite rank or title. If an individual is falling short of expectations, you risk losing motivation of the whole.

You made a grave error by choosing the wrong talent. Now it’s time to clean up your mistake.

Consider a route for termination.

If you determine it’s time to let an employee go, when and how you go about this process is important for many reasons: legally, emotionally, and to keep your reputation intact. How do you go about considering their feelings? How do you ensure you have a mutual agreement? It is vitally important during these times to make sure you personally take the time to be considerate of their needs out of respect for the institution you represent. Ensure both of you will be better off to let go of this unfortunate experience.


In the past, employers would fire on Fridays because it was convenient for payroll. But this might not be such a good idea. The weekend gives the employee time to stew on the firing, and he or she can’t jump straight into looking for new employment. Many employers agree that it’s better to fire in the middle of the week, as early in the day as possible.

Take their emotions into account.

You also need to consider the fact that their inability to be productive or the reason why all efforts to help them have failed could be due to underlying emotional or psychological issues. Proceed with caution.

In the event that an employee’s termination becomes emotional, whether that manifests in crying or any other type of emotional upset, have a quiet or private space allocated ahead of time. Treat him or her in a dignified way. With this approach, not only will you maintain the company’s values, but you’ll make the transition for the individual — who will hopefully go on to begin the next chapter of their professional career — a lot easier.

Have a conversation about what happens after they leave.

Even though things have been horrible between you and the employee, talk about how you can help each other now and later. Find the things you appreciate the most about each other as employer and employee. Stick to the script of what you both appreciate, and be a reference for each other despite your differences.

If one of you breaks the protocol on this essential step, the practice is broken for both of you. You both need something here: The employee needs a great referral, and, as an employer, you need to maintain your brand and reputation as a great employer. Don’t let someone go without first ensuring a mutual agreement of appreciation and follow-through on this. I have seen some companies go so far as putting this in writing and sharing appreciation on social media to ensure there is follow-through.

While you cannot force appreciation and a referral legally, you can make a personal agreement to engage in positive post-employment practices that are centered on gratitude, do no harm to either party and instead focus on leaving each other better off as a result of your experience together.

Let the process of helping each other move on — and be better for it — begin.

In closing, all signals point to a strong fall construction season. Let’s hope nothing happens to disrupt that. Until next month, thank you for your business and never hesitate to let me know how we can serve you better.

Best regards,

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