Construction market highlights industry speeches

by Industrial Distribution staff -- Industrial Distribution, 11/14/2007 5:51:00 AM

In his state-of-the-industry report on Monday, Nov. 5, STAFDA President Greg Drouillard focused on the construction outlook, competition from big box stores such as Home Depot and the strength of the overall economy. Drouillard, president of Target Building Materials in Windsor, Ontario, told attendees that the United States and Canada face similar problems in the construction industry.

He pointed out that U.S. homebuilding was down 24 percent in September, noting that “it was a terrible time to be in real estate … with foreclosures being up and a glut of houses on the market.”

Drouillard remains optimistic despite those numbers.

“The news in construction isn’t all bad,” he said.

The renovation market, for example, is strong and office construction is up 7 percent, Drouillard said, pointing to some opportunities for STAFDA companies. He also noted that 74,000 bridges in the United States need repair, meaning increased opportunities for distributors and manufacturers.

Drouillard also said STAFDA distributors are winning the battle against the big box stores. He pointed to Home Depot as an example, noting that HD is at a disadvantage because it has no outside salespeople calling on job sites and developing relationships with customers. He also noted the lack of adequate product knowledge among HD store employees.

Tim Tevens, CEO of Columbus McKinnon in Amherst, N.Y., told attendees that customers today are seeking more customized solutions than ever before. Tevens delivered the manufacturer state-of-the-industry report.

“They have a thirst for information,” he said, noting that customers want immediate responses to their questions and are increasingly turning to the Internet for answers.

Tevens mentioned several industry trends, including the need for distributors to offer customers services and solutions that can help them reduce costs.

“The manufacturers and distributors who work to streamline their supply chains will be the winners,” he said.

He also noted the downturn in the homebuilding market, but pointed to worldwide infrastructure work as a new opportunity for distributors and manufacturers. For example, he said China is buying 40 percent of the concrete being produced in the world for ongoing building and re-building projects.

Tevens also noted that the use of rental tools is skyrocketing and “will increase 40 percent by 2015.” He said the question distributors and manufacturers must ask themselves is: How do I provide training for this equipment and are customers willing to pay for it?