Audience: LBM

‘We Could Hire Ten People Today’: When Labor Holds Lumber Back

Posted on by Tom Brauch

When construction firms cite their biggest pain point in 2018, the answer is nearly universal: labor. The labor shortage has created unique concerns for lumberyards. Kennebec Journal and Morning Sentinel recently interviewed Norman Hunt, vice president of N.C. Hunt Lumber, a Jefferson, Maine sawmill and lumber yard with a truck fleet, about the effect of the shortage on his business.

 

When it comes to current challenges he faces, he doesn’t mince words. “Labor,” he said, when asked to identify the single biggest cause of his concerns. “Getting help and skilled labor.”

 

 

Facing the Labor Shortage

Labor is a problem across just about every area of his business. N.C. Hunt Lumber is currently looking for truck and equipment operators, salespeople, and a foreman. As Hunt says, “We could hire ten people today.”

 

He faces considerable competition from other lumberyards for the limited local labor pool.

 

He believes some of the conditions he observes could be unique to Maine. As a result of increased regulation, he says, “the younger people [in Maine] can’t find jobs and they moved out.” He has increased wages—by as much as $3 an hour—but even a wage increase can’t offset the powerful labor market forces working against his business. “It’s not a matter of how much we pay, because everyone is looking for help,” he says.

 

Sales Offset Labor Troubles

Fortunately, sales are going strong. Lumber prices are up due to environmental factors such as recent hurricanes. “We are selling lumber at 20 percent higher this year than we did last year,” he says, adding, “Gee whiz, our sales are good.” Increasing volume has proven an easier task than creating the staffing to make it all happen.

 

Norman Hunt’s and N.C. Hunt Lumber’s struggle with the labor shortage is far from unfamiliar to many lumber yards across the country. Until the shortage is resolved, lumber yards will continue to feel its effects. All the more reason for lumberyards to explore better technology, software, robotics, and smart equipment to help bridge the gap into a technologically-advanced future.

 

 

 

Soaring Lumber Prices Affect the 2018 Building Season

Posted on by Tom Brauch

Talk about sticker shock: lumber prices are up by 30% as the American lumber market buckles under the weight of the recently-imposed lumber tariff that imposed an average duty of 20.23% on Canadian lumber products in November 2017.

 

It wasn’t long before the market began to show the strain. As of May 11th, 2018, lumber prices have climbed to an average of $543 per thousand board feet. Futures contracts are also selling at $619, a 66% climb since last year.  Altogether, these changes in the market have pushed up the cost of a single-family home— and by as much as $7000 per home, according to the NAHB.

 

The tariff’s effects may be particularly pronounced because of other conditions in the lumber market. Canadian lumber is also struggling with transportation bottlenecks and growing housing demand. Canadian rail delays have limited the amount of lumber that can even enter the U.S. Some producers report they are working to reduce the backlog and expect to have it cleared in the next several months.

 

For now, Bloomberg analysts Joshua Zaret and Evan Lee report “razor thin” lumber inventories and predict market conditions for the rest of the year will continue to keep prices high.

 

However, according to some analysts it is unlikely prices will stick around beyond 2019. Walter Zimmerman of the ICAP, the world’s largest interdealer broker, considers the lumber price spike an “unsustainable bubble.” As the market adjusts, the bubble will burst, leading to lower prices over the next few years.

 

Fortunately, lumber prices do not appear to have inhibited the housing market overall. Despite the constraints of the current lumber market, builder confidence remains at a high, according to the NAHB Housing Market Index, which placed it at a healthy rating of ‘70’ in May—20 points beyond the minimum for a favorable outlook.

Boosting Efficiency, Passing on the Benefits: Technology for Lumberyards and Building Material Distributors

Posted on by Tom Brauch

If you’re a dealer, there’s a technological upgrade in your future, if you haven’t bought into it already.

 

“There’s a whole generation of people coming into managerial positions who have grown up with smartphones and tablets,” says Tom Spillane, Director of Marketing for Computer Associates. “We’re seeing their influence on…the kinds of tools LBM dealers are putting to use.”

 

The reasons for the sudden influx go beyond increasing comfort and familiarity: dealers are beginning to recognize the savings technology offers them, in terms of time, materials, and labor.

 

Katy Tomasulo for LBM Journal recently identified the ways technology is transforming the ways dealers do business.

 

 

Accessibility Anywhere

Now you don’t have to accept anything less than 24/7 access to your data, whether you’re sitting at a computer at a desk or using your tablet or smartphone. Cloud data storage makes it possible to deliver many of the benefits of newer technology in a more practical way. These are powerful benefits for your sales team.

 

Insightful Tracking

It’s not only sales that benefit. Telematics, GIS technology, and other advances have the potential to revolutionize lumber transportation. Imagine a device that analyzed traffic patterns to find more efficient delivery routes, or gave you perfectly precise ETAs. These devices exist and they are changing the way many dealers handle their drivers and fleets.

 

With benefits ranging from tracking maintenance needs, to reducing fuel costs, to isolating incidents of unsafe driving, and even reducing labor costs by tracking lost time, choosing to implement tracking and analytics technology is almost a no-brainer. “[I]t literally makes managing a fleet easier,” says Ryan Driscoll of GPS Insight.

 

Smarter Material Estimating

For John Maiuri of ECi Software Solutions, “[t]echnology is a tool that allows dealers to do more with fewer people and greater accuracy.” Who wouldn’t want to see those benefits in their business? But it’s not only you who will reap the rewards of adopting technology. It also could help you pass the benefits to your customers, offering differentiation from your competitors.

 

Some software, such as SAPPHIRE Supply, allows dealers to create highly-accurate material estimates based on a virtual 3-D model. Costs, quantities, and other data are therefore verifiable before construction. Material estimating “can open up new value-add opportunities for customers,” says Steve McFall of MiTek.

 

The Challenge of Implementation

Despite the obvious benefits of incorporating more technology into operations, many dealers stumble when it comes to the implementation phase.

 

A software solution can’t function if buy-in is weak and proper set-up and training is ignored.

 

Cindy McCarville of software firm DMSi says adoption has to occur from the top down: “Have a culture of management backing these decisions and understanding how [technology] makes a difference.”

 

Once management is on board, the whole process flows more smoothly. However, it’s a marathon, not a race. Take the time to properly install tools, to teach your staff how to use them, and implement good practices and procedures.

 

The challenges of implementation aren’t a reason to shy away from new technology. After all, the field is changing fast, and dealers don’t want to get left behind. As Steve McFall says, “In our increasingly competitive industry, dealers need to provide industry- leading ways of collaborating on projects to help protect their customer base and their profit margins.”

 

Better technology is one way to do just that.

Introducing ProSeries Wood Screws

Posted on by Tom Brauch

 

Easy to use in a variety of framing applications and equally easy to identify during inspections, MiTek ProSeries wood screws are an indispensable part of your jobsite.

 

What separates the ProSeries screws from the pack? ProSeries screws have the highest sheer values in the category—just take a look at the ICC-ES Report #2761. Reverse locking serration on the bottom of the screw head, and a self-drilling cut point that reduces torque during installation, both ensure a flush finish.

 

ProSeries wood screws come in bugle-style, washer-style, and hex-style heads. They also come in two finishes, one for exterior use and a yellow zinc finish designed for interior use. All screws have a low profile head style that can be driven flush or counter saw. This helps ensure less interference after installation.

 

Screws can be used for both deck ledger attachment and multiplied EWP connection. The hex head can be used in the place of more traditional lag screws.

 

Whether you love to know every detail about your products, you deserve more than a product that just “gets the job done.” Extra details in the engineering give you an edge before inspection time—so you can get back to taking care of business on the jobsite.

Christensen Lumber at the Forefront of Technology

Posted on by Tom Brauch

For Christensen Lumber who runs 3 shifts running one mile of wall per day, their goal is to be at the forefront of technology.

Christensen use SAPPHIRE & MBA software for their locations throughout Nebraska. For their teams, everything is visible in real-time for each of their core functions:

  • When a designer finishes a project, it kicks off a workflow
  • The shop sees it instantaneously – they know they can get to work on it
  • Sales sees wall design is complete and going into production – now they can notify their customer
  • Dispatch knows it’s done and can schedule for shipping.

With Lumber Prices Up, Housing Market Holds Steady

Posted on by Tom Brauch

Like the metaphorical frog in the boiling pot, softwood lumber prices have risen steadily, but noticeably: just 2.3% in March, but 12.9% since March of last year. Certain products have seen a 25% price increase since 2015.

Stirring the pot is President Trump, who just imposed a 24% tariff on Canadian lumber. US lumber can expect to see a boost, but component manufacturers or suppliers could see lumber become a bigger line item in their budgets this year.

Then again, the move did not come as a surprise to most of the industry. Before the decision was announced, Canadian investment bank RBC Capital Markets predicted more drastic tariffs of 30-40%. The 24% tariff may turn out to be more manageable for customers.

As RBC Capital Markets analyst Bob Wetenhall recently reassured the public, the lumber tariff is not expected to impact the housing market, profitability, or even home prices. The April NAHB Housing Market index fell three points in April in response to the decision but remains largely positive.

Overall construction materials prices have risen as well, though not to the degree of lumber. According to latest Bureau of Labor Statistics’Producer Price Index, material prices are up 4.4% year-over-year.

Generate Take-Offs in Half the Time

Posted on by Tom Brauch

If you’re in the building materials industry, you know how tedious and time-consuming take offs and estimates can be—and that’s assuming no additional changes are made.

 

Though lumber dealers and their clients use many tools in estimating, Cincinnati-based McCabe Lumber has found SAPPHIRE Supply to be a particularly powerful estimating tool to produce fast, accurate, and verifiable BOMs.  Following McCabe’s recent adoption of Supply, the results are clear: with SAPPHIRE estimating software, they can now generate take-offs in 50% of the time, freeing the sales team to pursue other leads and help customers with other needs. That’s while maintaining accuracy in modeling.

 

The technology behind Supply plugs into the SAPPHIRE Suite, which powers some of the most precise 3D BIM structural framing in the industry. Supply users can define their own accumulation rules, which further boost the accuracy of estimates. Supply also estimates for non-structural materials like drywall, roofing, and housewrap.

 “Now our sales team is not spending hours on estimates; instead, they are selling more jobs,” said Dave Renchen of McCabe Lumber.  The benefits of accuracy apply to more than just estimating, he adds. “[W]e see a clear path to reducing the error and waste rate from as much as 8% down to 2%.”

With Supply, McCabe can offer customers an installation guide with their list of materials, including the 3D model of the home as well as the collaborative power of SAPPHIRE Viewer, a tool that allows lumberyards, builders, and their clients to make changes on the go to a single BIM model, reducing communication errors.

 

It will be exciting to watch the power of Supply’s fast and accurate estimating continue to transform McCabe Lumber, whose customers include professional remodelers and high-end custom home builders. With a staff of 120 , about 700 customers, and $40 million in annual revenue, McCabe has a history of excellence that will only continue as they embrace the power of the latest software and technology to serve their customers.

465 Shear Walls. $30,000 in Savings

Posted on by Tom Brauch

The Power of Collaboration Gets the Job Done for Encanto at Dos Lagos

This new community in Corona, California offers buyers the full package: news homes in a great location with the lifestyle to match.

Building it was another story, one with a few bumps in the road. A 1,200-unit luxury development is not the type of project you would expect to save money on.  But with the use of MiTek Products, state-of-the-art software, and careful collaboration between the CM, builder, and framers involved in the project, savings topped over $30,000 and the project came together with speed and precision.

Most of the savings came from the adoption of Hardy Shear Walls. The project required 465 shear walls. Initially the team chose another brand—however analysis revealed adopting the shear walls would reduce costs by requiring a less expensive bolt, while still meeting code requirements on top of it.

Encanto Complex

Even after a high-stakes last-minute switch, said Huan Nguyen of the Gouvis Group, “[W]e were convinced it was worth the effort, even though it was no minor task to do the re-engineering and the swap outs.” The story of how HardyFrame came to be a part of the project illustrates not only the speed, but also their high degree of cooperation, of the team as a whole.

As Scott Blythe of Shaw Structures said, “[W]e also get such great service from Andy Perkins at Reliable Hardware and Supply, and the MiTek reps, we’d even pay more for their hardware.” One day on the jobsite the crew ran low on nails. Within hours a truck was there to meet their need and keep production rolling. Scott Bylthe adds, “even if cost were an issue, we’d stick with Reliable and MiTek. They do whatever it takes to keep my guys at top productivity.”

An emphasis on greater efficiency began before the crews get to the jobsite. Madera Truss used SAPPHIRE™ software to design and manage the manufacturing process for roof and floor trusses for the project. With 435 individual truss designs, there was a lot to keep track of, even putting aside the 10-phase delivery process.

“Encanto used a great many products from MiTek, including the 465 Hardy Shear Walls,” said Landon Boucher, regional sales manager for MiTek. “We do this on a regular basis, but with a high profile job like the Encanto project, it a real pleasure to work with all parties to make sure everything really came together.”