Volume 35, Number 6, June 2000

Runaway Train

Contract glaziers are loading up and heading out, boarding the train to a booming market

by Ellen Giard

 

When the economy is up, what’s the one activity most everyone loves to do? No questions asked, spend, spend and spend some more. Whether it’s a new car, boat or building renovation, the happier the economy the bigger the purchase, especially those rendering a profit. One such industry enjoying this millennium gold rush is the contract glazing segment of the glass industry. After undergoing a steady stint and slow pace in the early 1990s, many are now enjoying a healthy, profitable surge of projects.

 

All Aboard

Mike Logan, sales and marketing vice president for Flour City International, headquartered in Johnson City, Tenn., said his company has climbed back into its niche of high-rise projects. “In the early to mid 1990s business had slowed down. We did some post offices, airports and hospitals, but not much of anything else,” he said. “But now, the private sector and high-rise market is back up so we are really enjoying that.”

According to Logan, Flour City went public in May of 1998 and has become a global company with European and Asian projects. “We are in a growth mode,” he said. “Since we went public, our volume is up, our profits are in line and we have two new manufacturing facilities, one here in the states and one in China.”

Masonry Arts in Bessemer, Ala., is another company that has experienced business turnovers and is enjoying the current economy. “We have seen tremendous growth over the past year and a half,” said Larry Von Drasek, vice president. “We are seeing a broader market with institutional work as well as growth in government work.”

 

Station Check

Each year, Engineering News Record magazine (ENR) publishes its list of top specialty contractors, including the country’s top 20 glazing/curtainwall contractors (see pages 44-45). While those on the list from 1993-1998, varied slightly, several remained throughout. Until 1998, Harmon Ltd. held tight to the number one slot then slipped off and Walters & Wolf of Fremont, Calif., moved in.

1998 also saw the introduction of Architectural Glass & Aluminum of Oakland, Calif., which jumped onto the charts, taking claim to the number four position. “Aside from being a measure of a company’s annual sales and volume, I think the ENR list is an indication of what a company can accomplish in a year,” said Chuck Clark, vice president of sales at Architectural Glass and Aluminum. “I think the reason we were ranked so high on the list our first time is probably because we never reported anything before.”

Masonry Arts and Flour City International were also ranked each year. “We have consistently been on the ENR list due to our overall company philosophy of not being the biggest, but the best,” said Von Drasek. “We are very project selective, and many of our projects have been awarded to us based on negotiations rather than public bidding.”

Rolling On

Without a doubt, many in the industry agree that the good economy is the biggest reason contract glaziers have seen such a business growth. “We are experiencing good domestic and international economies, and low interest rates are providing the means and the methods to build,” said Von Drasek. “The government is also spending more on expanding and upgrading buildings, and suppliers and contractors have developed more of a relationship, instead of just a quick phone call.”

A move toward more custom work in projects is another direction several contract glaziers see the industry moving in. “We are getting less and less direction from architects and leaning more and more in the direction of design-build,” said Clark. Many do not see this as a downside. Logan adds that design-build is becoming a catchall for architects to not have to design walls, pointing out that many glaziers would probably prefer to do their own designing.

Still, glaziers are staying busy with plenty of projects and assignments. “Now there is enough work for everyone,” said Logan. “The little guys don’t have to reach up for the big projects and the big guys don’t have to reach down for the smaller ones.”

With the workload intact, many have heightened realization that good fortune will not carry on without effort from individuals throughout the industry.

“We have to continue to stress education of building codes and engineering,” said Craig Carson, major projects manager for A-1 Glass in Englewood, Colo. “We also have to be careful not to oversell our ability to install a product. We are being counted on to be experts in our field.”

With thousands of contract glazing companies operating across the country, many view earning jobs and hanging on to them as not a given, but rather a daily battle. “The work is there, but we have to stay diligent in all aspects. It’s not just about selling, but also performance,” said Logan.

Carson added that in order to stay on top a glazier has to know what sort of outfit the company is going to be. “Find your niche, but don’t abandon other projects,” he said. “We have to be willing to grow, listen and expand.”

 

Staying on Track

Just because the industry is faring well today, doesn’t mean there won’t be bumps along the road ahead. Glaziers agree there are certain issues to face in order to stay on top. Clark points out that the industry today has become driven by accelerated schedules. “It used to be that we’d be given four to six months to complete a project, whereas today, we are expected to finish the project in two months.” He also explains that as the industry’s pace speeds up, continuing to do well can become more difficult, requiring more overhead and personnel.

So what will it take for this flourishing industry to stay ahead? One way is to develop and maintain healthy interactions with other professionals involved in the project construction.

“We need to see more of a contractor/architect/owner relationship,” said Von Drasek. “We also need to see fair contracts and subcontractors need to be more active in working with the architect.”

Another matter glazier’s deal with almost daily is finding and keeping dedicated workers. “While our company is experiencing an explosive growth right now, we are having trouble getting good workers, those with a good work ethic,” said Carson. “We all need to get better at bringing people into the industry.

Logan agreed, explaining that companies will need to bring workers on from the bottom and train them while they are still in technical school.

“It’s a big win to some of these companies to steal an employee from someone else, but in the long run, it really doesn’t help anyone,” he said.

With international growth and capability expansions coming into play, glaziers in the United States may also find themselves having to stay one step ahead of the foreign markets in order to maintain their success.

“One of the biggest changes I see is in terms of other countries, such as Italy and Germany, becoming our biggest competitors,” said Logan. “They come here for jobs because they know there is a lot of work here in the states.”

 

Next Stop?

While recent years have seen many changes take place in the contract glazing field, much like other fast-growing markets, future changes and advancements can also be expected.

One major industry change occurred in April 1999 involving the sale of Harmon Ltd., a subsidiary of Apogee Enterprises Inc. Until that point Harmon Ltd. had been a dominate figure in global and monumental curtainwall projects, including the Petronas Towers in Kuala Lumpur, Malaysia. Apogee viewed the company as a high-risk venture and decided to sell all stock to CH Holdings, a private company located in St. Louis, Mo.

“This agreement completed our previously announced plan to exit our high-risk businesses and allows us to focus on the core business which we believe provides Apogee with the best opportunity for growth in shareholder value,” said Russell Huffer, president and CEO of Apogee.

Several in the industry point out, however, that in the long run, the changes with Harmon Ltd. could help the entire industry. “Since Harmon is now a private company, I think they are more focused on their profits and backlog,” said Logan. “And that’s good for the whole industry because it evens out the competition.”

Carson added that the changes with Harmon Ltd. appear to be a good example of a company overselling its talents and abilities. “They had a lot of strong resources and a lot of talented people, but I don’t think they had enough of those people working for them,” he said. He explained that in a talented-oriented, innovation-driven field, such as contract glazing, companies have to be conscious of how they grow. “You don’t want to take on
too much too quickly,” said Carson. “That’s not a criticism of Harmon alone, we all face such issues in this industry.”

Future changes the contract glazing industry can expect to see include a rise in engineering possibilities. “With the economy doing so well,” said Carson, “I think we will see a strong separation between the shops that do engineering work and those who do not. We are going to see more than just the bread and butter jobs; everything is going to become more custom oriented,” he added.

As for now, glaziers from coast to coast are relishing their industry’s present state. While there are still those who see every project they bid as their last, for the most part the industry as a whole has the right view of the big picture. They still find room for improvement, still strive to be the best and still welcome the competition.


USG

Copyright 2000 Key Communications Inc. All rights reserved. No reproduction of any type without expressed written permission.