Volume 33, Number 9, September 1998

 

FEATURE:

NWDA

Annual Summer Meeting Breaks All Records

by Debra Levy

The Northeast Window and Door Association (NWDA) annual summer meeting was a record-breaker in many ways. The record-breaking heat was tempered by the cool breezes from the Chesapeake Bay to the shores of Saint Michael’s, MD. The record-breaking attendance proved testament to the association’s growth and success. The group now has 83 associate and 49 regular members.

Approximately 180 people attended the two day event at the Harbourtowne Resort and Golf Club on the eastern shore of Maryland. And golf was the operative word, as the first part of the meeting revolved around the annual Willie Langfelder Memorial Golf Tournament and subsequent awards "crabfest" on Monday evening.

Tuesday was devoted to a membership update and educational sessions, with the Codes and Specifications section of the first session presented by Mike Mackereth of Architectural Testing Inc. Among the recent code changes of importance to window and door fabricators, Mackereth noted:

The first educational session was Practical Application of Diffusion Rates of Water Vapor into Desiccant Matrix and Bead Desiccants, presented by Dr. David C. Darwin, technical services manager of Grace Davison. In a very technical and thorough discussion, Darwin explained how desiccants are used. "No desiccant can survive seal failure," he said. "When you are faced with a failure, the desiccant will not save you."

Darwin also explained that desiccants fall into two main categories: Desiccant Matrix (DM) and Loose Filled Desiccants (LFD). Desiccant matrices are molecular sieves bonded by polymers. LFDs (such as Intercept©) are molecular sieves bonded by clay and formed into discrete beads, including blends of sieves and silica gel.

A discussion of the "shelf life" of desiccants was also included. "What happens when the lid is left off?" Darwin asked rhetorically. "The top layer spoils within one hour. The layer one inch down also starts to spoil, but there is no deterioration two to four inches down. Additional deterioration occurs at the rate of one-half inch per day." Darwin said a temperature T-Rise test can be used to determine whether or not a desiccant was still good.

Tim Singel of Guardian Industries made the next presentation, titled Evolving Ideas in Glass Performance. He began by citing some interesting statistics:

From 1988-1990 the number of window units shipped with low-E glass was small. In 1988 ten percent of the units shipped used low-E glass. This year, nearly 40 percent of all units are expected to ship with low-E glass. Singel said that consumer preference (due to the financial benefit) was the main reason for the growth. Singel urged fabricators to use a systems approach to product development, and to be aware of the new types of glass being developed, including the Super Tints.

Singel was followed by an interesting discussion of the consolidation currently occurring within the fenestration industry. Amelia Silver of BT Alex Brown and Glenn Crafford, managing director of BT Wolfensohn, discussed some of the characteristics typical of industries undergoing upheaval (see Consolidations Shake Up Industry, USGlass, July 1998, page 65). "It’s time to see how you line up," said Crafford. "Are you going to be the acquired or the acquirer?" Crafford offered an interesting formula for companies to assess where they fall (see box at right). "The frenzy is just beginning," said Silver.

The discussion brought thoughtful questions from those in the group, many of whom concentrated on the issue of warranties. In response to one such question, Crafford said, "You must understand that when you provide a warranty, you must also provide for that warranty as a company liability. Many companies meet warranties out of general operations when the need arises. But buyers do not treat warranties in this fashion. I have seen too many companies with much of their value tied up in warranties. It is an issue to consider now, not when you are ready to sell."

Many left with food for thought as they headed to food for real at the closing lunch.

NWDA’s next event is an educational session on Understanding and Selling High Performance Windows. Noted training expert Steven Eisley will be providing a full day session on Wednesday, October 14 in suburban Philadelphia and again the following day in suburban Pittsburgh.

USG

Debra Levy is the publisher of USGlass magazine.

SIDEBAR:

Acquirer or Acquiree?

Silver and Crafford sugested a simple test to assess how window and door fabrication companies can best position themselves in the age of consolidation. For each item below, please score one through ten, with ten being the highest.

Scale of Business:

Rate the size of your business in comparison to competitors. How large is your business within the market? How much market share do you hold? The larger the scale of your business, the higher the score should be.
Score: _____
 
Product Profile:
Rate the range of products your company offers. Is most of its business from one product line or do you offer a wide variety of products and price points? The more diverse your product profile, the higher your score should be.
Score: _____
 
Financial Feasibility:
Rate the strength of your financials: your balance sheet, income statement and cash flow. Assess your debt levels. The stronger your company is financially, the higher your score should be.
Score: _____
 
Management Depth:
Rate the depth of your company’s management. Does the company have a strong management team in place or do all decisions go through you? Would your company have competent management if you were out of the picture? How many family members are in management positions? The more competent your management team, the higher your score should be.
SCORE: ____
 
Time Frame:
Rate the time frame in which you want a transaction to take place. Are there some factors (illness, market conditions) that are forcing you to move quickly? The more time you have to effect a transaction, the higher your score should be.
SCORE: _____
 

TOTAL:_____

 

SCORING—

If your company scored 20 or below: Consider a sale to a larger entity. This type of company is in the most danger of failing to survive an industry-wide consolidation and selling is a viable alternative.

If your company scored 21-35: This company is in one of the more dangerous positions during an industry consolidation. Management must think hard about whether the company can make it alone, be acquired or begin to acquire other companies. This company is ideal for a "roll-up" situation in which many smaller companies are merged together to create an industry powerhouse.

If your company scored more than 35: You are in control of your destiny and may be in a position to acquire control of other companies within your industry. Many options are available, and with proper planning, a bright future expected.


USG

© Copyright 1998 Key Communications, Inc. All rights reserved. No reproduction of any type without expressed written permission.