SHELTER
Building a Future for Distributors and Dealers of Building Products

January/February 2005                                Volume 44,  Issue 1

    
In the News

FORECASTS

Companies Share Trends for 2005

The forecast of any industry is hard to predict and forecasts for the future can be as uncertain and as diverse as predictions for the weather. Reed Construction Data held its annual North American Construction Forecast conference last October and offered its predictions as to what construction business would be like in 2005. 

Predictions ranged from almost no change at all to a 3.5- to 4-percent increase in industry growth in the early part of 2005. Overall, though, feelings about the future remained optimistic, with the small consensus that 2004 will end showing some growth and 2005 will be a boom year.

SHELTER asked distributors and manufacturers to give some insight as to how 2005 will shape up. Here’s what some of them had to say:

Distributors’ Outlooks
Larry Ray, president of Great Homes Gallery of Jackson, Miss., said the indications that the industry has are blueprint activity shows that at least the first quarter of next year will be better than the last quarter of this past year. Ray attributes last quarter’s slowdown to the recent slow down of the economy and weather, but he believes that the expected rise is due to post-election momentum, as well as inflationary pressures and the “first nudge, perhaps, of increasing interest rates.” 

Ray says that he sees a clear trend particularly in the aging population—who are looking toward smaller but better appointed spaces.

Joe Bayer, president and chief executive officer of Bayer Built Woodworks of Belgrade, Minn., believes the large variety of products is the largest trend. 

“We are selling to a more discriminating society, with a desire for ‘new and different’ rather than the same old thing,” Bayer said. 

“A trend back to classic ‘cottage’ and ‘arts & craft’ styles is being revived by architects and designers … It’s refreshing but challenging for suppliers to anticipate what to carry in inventory. More and more jobs require custom profiles of mouldings with non-traditional door styles being specified. It bodes well for a manufacturer/distributor that is able to work miracles on a daily basis,” he added. “Prefinishing doors and trim before being delivered to a job site is certainly becoming the trend. We currently ship more than 30% of our orders prefinished to our customers, and this is growing every day.”

Michael Lupo, president and chief executive officer of St. Louis-based Huttig Building Products, expects the U.S. economy to continue in a slow growth pattern.

“Immigration growth continues to drive the building sector to continued record growth, offset somewhat by rising interest rates. Overall, the construction industry should be flat to a small increase,” Lupo said.

Lupo believes consolidation in the installation of building products will continue in 2005.
“Large players, such as Masco and The Home Depot, will continue to buy their way into the market through acquisitions,” Lupo added.

A Manufacturer’s Perspective
Bob Merrill, president and chief executive officer of Craftmaster Manufacturing Inc. (CMI) of Chicago sees for the housing economy in particular, that the industry is looking at a slow down in the future.

Merrill said this past year went far better than the company expected.

“We planned for a slow down and got very close to a record for us. That’s why we’re expecting things to slow down in 2005,” Merrill said.

As far as trends for the coming year, Merrill said company officials expect composite wood products to keep growing.

TRADE NEWS
Key Communications to Debut: Mold and Moisture Management Magazine
The first trade publication for the mold prevention and abatement industry, Mold & Moisture Management magazine, will present its debut issue at the beginning of the new year, January/February 2005. Mold & Moisture Management magazine is a quarterly publication created to address industry needs concerning the rising influx in legal cases, building concerns and repairs required to solve the ever-increasing caseload within these fields. 

Free subscriptions to qualified industry members are currently available online at www.moldmag.com. Mold & Moisture Management is a sister publication to 
SHELTER magazine.
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