July 2006

Survey Shows Greater Optimism for Economy

In its first survey directed at small businesses in the construction/contractor industry, the International Profit Associates Small Business Research Board measured and compared overall small business to this important business segment.

The IPA Small Business Confidence Index, which measures expectations about revenue growth, the general economy and hiring looking forward 12 months now stands at 47.3 for small business. In the construction/contractor industry, the IPA SBCI is at 49.3 compared to 44.6 in the non-contruction businesses in the survey.

The construction industry is more optimistic about the general economy for the next year than small business overall. Construction company executives are 23 percent more optimistic than their business peers in the non-construction small business sector. Forty-eight percent of those in construction surveyed felt the general economy will improve compared to 44 percent in overall small business and 39 percent not in construction.

When asked to identify the single most important issue to their businesses, 25 percent of those in construction identified the cost of materials as most important. This compared to 10 percent in non-construction businesses. Conversely, the cost of energy/fuel was cited by 16 percent on non-construction and only 3 percent of construction/contracting businesses.

Interestingly, finding quality employees is of major concern to many businesses, but a bit less so in construction. Overall, 13 percent indicated finding quality employees as the single most important issue facing them. In construction, 10 percent identified this as the most important issue, while in non-construction small businesses, 16 percent of owners and managers identified this as the top issue.

On the hiring front, construction expects to increase hiring more than general small business. Overall, 39 percent of small businesses expect to increase hiring during the next year. In construction, 43 percent feel they will increase hiring as compared to 34 percent in non-construction industries.

Nearly 500 small business owners and senior managers participated in the IPA SBRB poll, of which 281 were in the construction/contractor industries.

Number of Green Home Builders to Increase in 2006

Results of a McGraw-Hill Construction/National Association of Home Builders survey, called Residential Green Building SmartMarket Report, indicate that 2005 saw a 20 percent increase in the number of home builders producing green, environmentally responsible homes. The study indicates that number will grow by another 30 percent this year.

By 2010, the value of the residential green building marketplace is expected to boost its market share from $7.4 billion and 2 percent of housing starts last year to $19 billion–$38 billion and 5–10 percent of residential construction activity.

According to the survey results, the leading reason that builders are considering green is that "it’s the right thing to do,” and an indication of the industry’s strong links to the community. Of those polled, 92 percent identified this factor as a very or somewhat important influence behind the decision to go green.

Other prominent influences include lowering lifecycle costs, such as energy efficiencies and productivity increases (87 percent); staying ahead of the competition or expanding business with customers who are interested in green building (82 percent); and limiting exposure to liability on such issues as water leaks and mold (78 percent).

Obstacles remain, the survey showed. Starting costs and the lack of interest by consumers to pay additional costs for a green home are perceived as a barrier by 82 percent and 79 percent of firms surveyed, respectively. Also rated as important were educating the marketplace on green building concepts (by 79 percent) and revising codes, ordinances and regulations (72 percent). Only 39 percent said that the perception of green building as a fad and not something here to stay was a significant roadblock.

To order a copy of the report, go to www.analyticsstore.construction.com or www.builderbooks.com.

April Construction Advances 4 Percent

The value of new construction starts increased 4 percent in April to a seasonally adjusted annual rate of $688.7 billion, according to McGraw-Hill Construction, a division of The McGraw-Hill Companies. Moderate gains were reported for nonresidential building and nonbuilding construction (public works and electric utilities), while residential building showed more modest growth. Through the first four months of 2006, total construction on an unadjusted basis came in at $210.5 billion, up 8 percent relative to last year’s January–April period.

Nonresidential building in April grew 5 percent to $189.1 billion (annual rate).

Residential building in April edged up a slight 2 percent to $383.5 billion (annual rate).

Total construction registered this year-to-date performance: the West, up 13 percent; the South Central, up 8 percent; the Northeast, up 6 percent; and the Midwest and South Atlantic, each up 5 percent.

ASA Continues Contract Negotiation Series

It’s such a self-evident truth in the construction industry that it has been elevated to cliché: One small mistake in a contract can cost a firm tens of thousands—or more—in lost revenue, legal fees and time.

The American Subcontractors Association Inc. is providing subcontractors with tools to avoid contract pitfalls by bringing education directly into the workplace. The association will host a series of conference calls to help participants learn critical points of contract negotiation without having to leave the office. Through ASA’s "Critical Skills Series on Contract Negotiation,” participants will learn negotiating tips from professionals at a fraction of the cost they would otherwise pay. The fee is $45 per call for ASA members and $65 per call for nonmembers.

Each one-hour conference call will address a particular critical skill that can help subcontractors save themselves from costly mistakes. The topics, such as "strategizing for reduced retainage” and "getting and using payment assurances,” are based on ASA’s national Stand Up! education program. The Columbus, Ohio-based law firm of Kegler, Brown, Hill & Ritter will facilitate the calls.

Each call will take place from 11:30 a.m. to 12:30 p.m. Eastern time. ASA will provide participants with a toll-free call-in number and code when they register.

The 2006 schedule is as follows:
• July 19—Strategizing for Reduced Retainage.
• Aug. 16—Getting and Using Payment Assurances.
• Sept. 20—Negotiating Payment Terms.
• Oct. 18—Limiting Lien Waivers.
• Nov. 15—Preventing Hold-Harmless Catastrophes.
• Dec. 20—Evaluating the Risks of Insurance Requirements.

ASA encourages subcontractors to sign up early because space is limited. Register online at www.asaonline.com or call (703) 684.3450, Ext. 1320, for more information.

Ames Taping Tools Mourns Passing of Whipple; Winn Is New CEO Charlie Whipple, 52, president and CEO of Ames Taping Tool Systems, Inc., Atlanta, died May 18 while in the care of physicians at Duke University Medical Center. He was surrounded by his family, loved ones and friends at his passing.

Whipple had served as president and CEO of Ames Taping Tools for the past four years. Typically the first to arrive and last to leave, he was noticeably absent from the corporate office during the past month. Not long thereafter, Ames staff members were notified that he was suffering from cancer, the nature of which would require immediate treatment and a post-treatment convalescence at home.

During Whipple’s tenure at Ames Taping Tools the company experienced tremendous growth in its retail operations, adding more than 40 new store locations across the country. It was during his watch that the firm passed the 100th store benchmark, a significant milestone. Most recently on Dec. 21, 2005, Whipple led Ames through a change of ownership.

Whipple is survived by his wife, Sharon, and his three children. After Whipple’s passing, the company elected Carl Winn as the company’s new president and chief executive officer.

Winn has more than 30 years’ experience in the construction industry. He joined Ames in 1990, most recently serving as executive vice president of sales and marketing, and president of Ames’ TapeTech division.

The company is opening more than 20 new store locations in 2006, and currently has company-owned store locations and franchise operations in more than 200 of the fastest-growing residential and commercial construction markets in the U.S. and Canada.

People & Companies in the News

Phoenix-based Amarok, Inc., a member-owned cooperative serving the independent gypsum specialty dealer, has named Ron Massa vice president, effective immediately. Massa succeeds Lance Rantala, who was named CEO of Blue Hawk, an HVAC cooperative.

Brady Construction Innovations, Inc. has received its New ICC Evaluation Report, ICC ESR-1042, SLP-TRK® Slotted Steel Tracks for Interior and Exterior Non-Load Bearing Wall Systems. This new report supersedes the old ICBO ESER-5344 Report. ICC ESR-1042 is compliant with the 2003 International Building Code® and the 1997 Uniform Building Code™. When specifying or installing fire-rated, head-of-wall assemblies, this document should be submitted with a [tested] listed fire-rated design that complies with UL-2079 Standard for Fire-Resistance for Building Joint Systems.

Fabcon, Savage, Minn., has promoted Dave Henderson to director of operations, where Henderson will oversee company-wide implementation of advanced manufacturing systems.

Fortifiber Building Systems Group™, Reno, Nev., welcomed Russin Lumber Corporation, Montgomery, N.Y., as a new distributor of Fortifiber’s weather-resistive barrier and flashing lines.

The Gypsum Association, Washington, D.C., has elected the following officers from its board of directors for 2006–2007:

The chairman is James W. McNeer, vice president of gypsum operations for Temple-Inland Forest Products Corporation, West Memphis, Ark.

The association’s past chairman is David R. Obergefell, vice president, Manufacturing West Region, United States Gypsum Company, Chicago.

First vice chairman is Ike N. Preston, president, Lafarge North America Inc., Herndon, Va., and second vice chairman is Kerry G. Gannaway, senior vice president, manufacturing, American Gypsum, Dallas.

The association’s treasurer is Gerard P. Carroll, senior vice president of manufacturing operations and engineering for National Gypsum Company, Charlotte, N.C., and Michael A. Gardner, executive director of the Gypsum Association, is secretary.

All terms became effective May 1, 2006.

Hacker Industries, Inc., Newport Beach, Calif., has added James Longo as technical service manager to its team of underlayment specialists. In his new role, Longo will lead the technical and product development efforts related to the company’s new self-leveling underlayments. He will provide proactive consultation to Hacker Industries, Inc.’s licensed applicators, coordinate and facilitate competitive analyses, provide internal technical training, and assist with proposals, writing specifications and provide technical assistance to architects, general contractors and floor covering professionals.

Insulfoam is expanding its operations to include a full-service production facility in Marlin, Texas, to manufacture expanded polystyrene building products. Its new, state-of-the-art facility will enable Insulfoam to expand, mold, fabricate and ship its products to customers in the Texas and Louisiana markets.

Slated to open this month, the existing 120,000-square-foot plant is being modified and upgraded to improve its manufacturing capacity.

JLG Industries, Inc., McConnellsburg, Pa., has promoted Israel Celli to senior vice president, international market development and sales, effective June 1, 2006. As a senior officer of the company, Celli continues to be responsible for all international sales, sales support, marketing and service operations for Europe, Asia/Pacific, Latin America and developing markets.

Kamco Supply Corporation of New England, Wallingford, Conn., has purchased Commercial Interior Supply, Inc., and its Buffalo and Rochester, N.Y., locations. The deal, which was effective June 1, brings the number of Kamco New England locations to 10. Commercial Interior Supply President Bud Bradley will serve as a business consultant while Jeff Morton, regional manager of Kamco New England’s Albany and Glens Falls facilities, will oversee operations at the new locations.

Knauf Insulation, Shelbyville, Inc., and the Greenguard Environmental Institute announce that several Knauf products have earned the new Greenguard Children & Schools™ certification. Knauf’s fiber glass batts, blankets, Jetstream® blowing insulation, Perimeter Plus™ Blow-In-Blanket insulation, duct wrap and metal building insulation all meet the requirements of Greenguard for Children & Schools, which establishes extremely strict chemical emissions standards to accommodate the special health needs of children in educational and daycare facilities.

Multiquip has opened its new office and manufacturing facility in Shanghai, China. MQ-Shanghai carries Multiquip’s complete product line and also markets STOW Construction Equipment’s concrete and masonry products plus products from Multiquip’s Sanders Saws division to contractors and builders across China and throughout Asia. While MQ-Shanghai serves primarily as a distribution center, light assembly of many products is also conducted in conjunction with local Multiquip business partners. The facility is under the direction of Xiwen Shi, Multiquip’s business manager–Asia.

Ben Garcia of Expo Stucco Products, San Diego, Calif., has been elected president of the National One Coat Stucco Association, headquartered in Arlington, Texas. Paul Dixon, Sto Corp., Atlanta, was elected vice president and Steve Taylor, Omega Products International, Corona, Calif., was elected secretary-treasurer.

George Adams, EZ Wall Premix, Inc., Dallas; Peter Daechsel, Degussa Wall Systems, Jacksonville, Fla.; and Tim Williams, UltraKote Products, Phoenix, were elected directors.

Also serving on the board as a director is Charlie Meador, Magna Wall, Inc., Dallas. Associate director is Drake Nelson, Tyvek Weatherization, Phoenix.

Wayne James, CAE, CSI is executive director.

Negwer Materials Inc., St. Louis, Mo., has added Rich Hargis as operations manager. As Negwer’s operations manager, Hargis oversees the company’s safety program, inventory flow and distribution, equipment and facilities.

Phillips Manufacturing Co. has opened its newest Southeast Distribution Warehouse in Orlando, Fla., to service the state of Florida. Phillips Manufacturing makes drywall beads and trims, channels and framing components.

Powers Fasteners, Inc., Brewster, N.Y., has appointed Ira Liss as Tennessee branch manager, and has expanded sales coverage in the West with the appointments of Greg Seroka and Michael Olsen as sales representatives in Las Vegas and San Francisco, respectively.

Liss has 20 years’ experience in the fastening industry.

Seroka has extensive fastening sales experience in the mechanical and electrical trades.

Olsen joined Powers after two years as an inside sales representative for White Cap Construction in Dublin, Calif.

Strait-Flex International, Inc. has hired Ben Lester as vice president of sales and marketing. Strait-Flex International, Inc. manufactures and distributes Strait-Flex brand cornerbead products around the globe through professional, retail and wholesale distributors.

Triangle Fastener Corporation has opened its 24th location in Ft. Lauderdale, Fla. The branch will be managed by Chris Gorey. TFC provides standard and specialty fastening systems solutions for the commercial construction industry. The company offers products for metal, wood, drywall and concrete applications and offer support programs.

In Memoriam

Ronald J. Becht Sr., former executive director of the Northern California Drywall Contractors Association and the Drywall Information Trust Fund, died June 10, 2006. He was 73.

Becht was executive director of the NCDCA/DITF for 37 years. He retired in 2005. In 2004, Becht received the President’s Award from the Association of the Wall and Ceiling Industry for 47 years of participation in the wall and ceiling industry.

After serving in the U.S. Army, in 1956 Becht joined National Gypsum’s pricing department in Buffalo, N.Y. In early 1963, Becht and his family were relocated to Phoenix, where Becht was named an outstanding salesman for the company.

In 1967, National Gypsum offered Becht the district manager position for the Portland, Ore., area. At about that same time, the largest drywall contractor in Arizona, Pete King, offered Becht the opportunity to open a branch office for his expanding drywall operation in the Bay Area of Northern California, and Becht took the offer.

Although King’s company left California several years later, the Becht family chose to stay in California. It was at this time that Becht was hired by the Drywall Information Trust Fund as the technical arm of the state association. After three years, Becht was involved in all aspects of the industry.

Becht leaves behind his wife of 51 years, Rita, three children and four grand children.

The family asks that memorial contributions be sent in Becht’s memory to the American Lung Association.