Volume 46, Issue 2 - March 2011

feature

 

For Midwest, Better Times Beckon
Some Midwest Glass Shops, Glaziers, See Light at the End of the Tunnel
by Megan Headley

The Midwestern commercial glass industry may not be out of the dark yet, but reports are that there’s light ahead.

“It’s looking better right now than it has in a few years,” says Jim Pegg, president of Architectural Glazing Systems in Mount Morris, Mich. “Things are looking much better; you can see the light at the end of the tunnel.”

The glazing contractor reports that design activity is picking up in his region.

“Architects are starting to get a little bit busier here in this area. It’s looking much brighter. I’m very optimistic that this year is going to be much better than the past couple of years,” Pegg says.

“As far as activity I see a lot more estimating, better than last year,” says Mike Carlson, branch manager of Midwest Glazing & Allied Glass in Davenport, Iowa. “It seems to be better. It could be a lot better,” he adds, “but I see a maybe 30-percent increase.”

“It was pretty slow in December and January until about the middle of February and the last couple of weeks have been pretty good,” says Larry Willsher, owner of Northland Glass in Clear Lake, Iowa. Willsher admits the area did see some warmer weather in February, which may have helped, but primarily he has been doing interior work.

“Generally we don’t do a lot in the winter up here just because of the weather and because the town that we live in is a tourist town,” he says. “There’s not much going on in the wintertime, although we generally keep busy. But this year we had about six weeks of hardly anything. That kind of killed us, but we’re going again now.”

That things are beginning to pick up is keeping Willsher optimistic about the rest of the year.

“I feel good about what’s coming. I hope things keep going our way,” Willsher says.

Pat McGonigal, division manager of Glass Contractors Inc., a fabricator in Omaha, Neb., says that “up” might be the trend for business later this year, but it’s not quite the case now, for much the same reasons that Willsher mentioned. Overall, McGonigal says, “It’s still pretty slow.” He adds, “The weather’s getting better, so we’re seeing a little bit of an increase here, but it’s mostly interior work we’re seeing.”

Still, he adds, “We feel like everybody’s positive and things are going the right way. Will it be better than last year? We hope so but not necessarily planning on it. But we feel like the future is brighter.”

For Brian Schermetzler, manager of Ellerman Glass LLC, a glass shop in Manitowoc, Wis., “Commercial work is still very slow.” Moreover, he says, “Residential work, new homes, is very slow—but remodel work is doing well.”

Ellerman Glass provides services for automotive, residential and commercial glass customers, giving the company an overview of the industry. “I see the residential sector gaining, and I also do see the commercial gaining, but very slightly,” Schermetzler says.

Jim Jankauskis, business unit manager for shower doors for Foremost Groups Inc. (which is planning to launch a business unit in the Midwest), agrees that residential remodeling remains the hot spot. “Business conditions in the whole United States and Midwest are really challenging right now, but we’re seeing some improvement in the housing market and remodeling sectors recovering,” he says.

W.A. Wilson Inc. is one of those seemingly rare companies that has moved from other areas of the glass business into commercial glass products. In January the glass distributor, which has facilities in Canton and Columbus, Ohio, sold its auto glass assets to Mygrant Glass. President Bob Hartong says, “We’re very much focused on the commercial side, between our insulating and tempered and metal line. That’s where our focus is.”

Even with that concentrated focus, Hartong says the company is facing a challenging year ahead.

“[Business] is certainly difficult, and off to a slow start so far this year. Really we had a nice up-tick in the third or early fourth quarter of last year, and then toward the end of the year it really seemed to have dropped off,” he says.

Dennis Branner, owner of Branner Glass Co., a commercial and residential glazing contractor in Springfield, Ill., says that so far, business in 2011 has been “terrible,” and his expectations for the rest of the year remain low.

Branner adds, “It’s getting a little bit better, there are a few more jobs out there for the bidding right now, but it’s just as slow as you could ever imagine.”

When asked about his expectations for his flat glass business in 2011, Hartong says, “I really do think it’s going to be difficult for the first half of this year. I think third quarter we’ll probably see things pick back up. What we forecast for this year is probably a very similar year to 2010.”


Architectural Billings Hold Steady
After showing positive momentum during the fourth quarter of 2010, the American Institute of Architects’ (AIA) Architecture Billings Index (ABI) slipped almost four points in January. As a leading economic indicator of construction activity, the ABI reflects the approximate nine to twelve month lag time between architecture billings and construction spending. AIA reported the January ABI score was 50.0, down from a reading of 53.9 the previous month. This score reflects stable demand for design services (any score above 50 indicates an increase in billings).The new projects inquiry index was 56.5, down sharply from a mark of 61.6 in December. The Midwest average was 56.4.

“This slowdown is indicative of what is likely to be a very gradual improvement in business conditions at architecture firms for the better part of this year,” says Kermit Baker, PhD, Hon. AIA, AIA chief economist. “We’ve been taking a cautiously optimistic approach for the last several months and there is no reason at this point to change that outlook. There are still too many firms that continue to see weak market conditions to expect a dramatic increase in the demand for services in the design an
d construction industry. ”



Trending Topics
Pegg’s optimism for 2011 may stem from the fact that the glazing contractor has pursued institutional projects. “It seems like there are more schools out for bids right now, and there are airports in our area that are doing additions and remodels,” Pegg says.

Hartong is seeing continued demand from government projects—and energy-efficient products as a result.

“Certainly, with the government’s push for everything to be green-building, all the high-performance products [are in demand],” Hartong says.

McGonigal’s company, meanwhile, provides “a lot of heavy glass, a lot of specialty colors and interior finishes with artwork.” As far as demand, the fabricator simply keeps getting requests for more custom finish work.

With residential remodeling showing a glimmer of activity, Schermetzler says that Ellerman Glass is supplying residential products for now. “We’re doing more shower door work because people are putting their money back into the homes instead of buying new homes, so they’re remodeling kitchens and baths first,” he says.

Willsher agrees that the focus seems to be on remodeling, especially in the tourist town on the lake in which he works. “I’ve sold seven glass shower doors in the last week—high-end, heavy glass,” he says. “Two of them are for the same new house, the rest of them are for remodels.”

“We see an opening [for shower doors] in the Midwest and Chicago, after several different manufacturers have either closed the doors or pulled out of the region,” Jankauskis says. “We will have a full line, as we’re seeing a trend as everyone else has toward the frameless doors.”

Jankauskis acknowledges that it seems like more companies are looking at closing their doors than opening, but Foremost believes now is the time to launch. “There have been a couple companies that have closed their doors, and we feel that this is the time [to fill the void],” Jankauskis says.

Ahead of the Curve
Many of these Midwestern glass companies are taking a fresh look at their business and marketing plan, without going to the extreme of Foremost and W.A. Wilson.

Pegg reports that Architectural Glazing Systems will be looking at growing its office space in the year ahead in preparation of a business boom. “This is something we’re going to be looking at,” he says. “We definitely need to renovate our building … and we would like to hire additional people this year.”

Ellerman Glass LLC is focusing on drawing in new customers.

“We’re focusing more on advertising,” Schermetzler says. “We did radio last year and now we’re upgrading signage.”

Branner Glass, meanwhile, is chasing after new customers. “We’re looking at different areas,” Branner says. “We’ll widen our geographic area a little bit, but that’s not something that we like to do.”

Northland Glass is getting an early start on its spring marketing as residents return to their lake homes. “We do a couple home shows in March and that usually kicks us off, but we’re kind of getting started early this year,” Willsher says.

For Glass Contractors Inc., the goal is to continue to improve the company’s interactions with new and existing customers. “We’re definitely trying to be more customer service oriented, and better at what we do,” McGonigal says. “We’re just trying to refine our processes and make it easier for customers to do business with us.”

Top-notch customer service is about the best thing a glass shop can offer at a time when customers are browsing for deals.

Megan Headley is the editor of USGlass.


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