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February 25, 2008
Integrated Supply: Coming to a Distributor Near You?
During the first half of the 15 years I've spent writing about the residential-construction business, I worked for a magazine called Supply House Times. Its audience is wholesale distributors of plumbing and HVAC materials, as well as industrial piping for non-residential applications. I was the industrial PVF girl, but I learned a lot about the PHC (plumbing-heating-cooling) side of the business, too.
In fact, one of the advantages I had covering PVF (pipe-valves-fittings) was watching the development of "integrated supply" in that segment of the business. It's a complex process, but defined simply, integrated supply is one supplier providing everything the customers needs to run their plants -- piping, abrasives, fasteners, tools, janitorial supplies -- anything besides the materials used in actually manufacturing their products. One supplier covers the entire maintenance/repair/operations (MRO) line of products.
The advantage: The customer gets only one invoice and pays only one invoice for MRO materials. That saves them a lot of money; any manufacturer that has been in business for any length of time knows exactly how much it costs to process an invoice. (The numbers I saw back then generally ran about $75 each, mostly the cost of the personnel needed to shepherd an invoice from accounts payable through accounting and into the archives.)
My point is that the concept of integrated supply could help cut costs for builders, too. I suspect it's on its way, too -- an idea that hit me when I discovered that Wolseley, a British conglomerate that owns Ferguson -- the largest distributor in the PHC business -- also owns Stock Building Supply, the largest building-materials distributor in the U.S. The result is that between the two companies, they can supply just about everything necessary to build a house -- from the concrete for the foundation to the knobs on the cabinets to the shingles on the roof. And they could do it all with only one invoice to the builder.
In this time of crunched margins, builders are looking for ways to cut costs (or they should be). Establishing a streamlined supply chain with a really good distributor is a great way to do it. You have one point of contact if, for example, the plumbing hardware doesn't arrive before the plumbers need it or the custom-ordered tile for the kitchen is delivered before the framing is finished. (Yes, it's very possible for deliveries to be too early. Where will you store it?)
I know most builders already have relationships with their suppliers. But how could it save you money if you only had to make one phone call to order everything you'll need for the next two weeks? Or the next month? Forget about that $75 invoice; think about the time you'd save.
Does integrated supply sound like something that would work for your construction company? What kind of concerns would you have about doing business this way? What advantages do you see -- or disadvantages? Let me know; I'm interested in finding out where this might wind up.
Posted by Marjie O'Connor, HGTVPro.com Staff at 2:47 PM | Comments (1)
February 21, 2008
The Whole World is Going Green
If you were at the International Builders' Show in Orlando last week and did not notice a huge emphasis on green building ... well, it reminds me of the joke, "If you remember the '70s, you weren't really there." Green was everywhere: products, workshops, buttons -- even shirts. (Thursday was Green Day, and many attendees were sporting NAHB polo shirts in the unmistakable shade of newly sprouted grass.)
Of course, a lot of this was driven by the new NAHB National Standard for Green Building, which is "almost ready for prime time," as NAHB says. The organization is proud of this program; a lot of hard work has gone into it.
A big chunk of my work at the show was interviewing some of the industry's movers and shakers. No matter how those conversations started out, sooner or later they all came around to green.
Geoffrey Mouen, architect for the Tradewinds show house, kept energy efficiency in mind through the entire project -- from choosing the site to speccing the products.
Fernando Pages, who built the first PATH Concept Home last year, talked with me about affordable housing and quality, but he emphasized that almost by definition, quality construction and affordability have to be green.
Dick Titus, executive VP of the Kitchen Cabinet Manufacturers Association, is very enthusiastic about that group's highly successful Environmental Stewardship Program. So are KCMA members, it seems; in only 15 months, 90 companies have signed on.
If you're a builder, what do you think are the most important issues that the new guidelines should address? Green building covers a lot of ground, after all; which aspects give builders (and homebuyers) the biggest bang for the greenback?
If you're a homeowner, what kind of standards would you like to see? Is there something about your house that you wish had been done greener? More insulation, maybe, or higher-performance windows?
I have my own long list of "Why didn't the builder do this in my house?" points, of course. If enough builders adopt the new standards, maybe future homeowners won't have to worry about such deficiencies.
Meanwhile, I'm thinking retro-fit.
Posted by Marjie O'Connor, HGTVPro.com Staff at 10:40 AM | Comments (1)
February 11, 2008
Off to the International Builders' Show!
It's that time of year again. I leave tomorrow for the International Builders' Show in Orlando, where I'll get to see old friend and make new ones. The thing that has me really psyched, though, is the emphasis on green building this year — even more than last year.
In fact, Thursday, February 14, is officially Green Building Day at the show. (You thought it was Valentine's Day, didn't you?) I'll spend a good part of the day in the HGTVPro.com booth, observing some interviews with people who know a lot about green building, including Bill Asdal, CGR, a remodeler who renovated a 100-year-old farm house into a zero-energy house, and Mike Luzier of the NAHB Research Center, who will discuss the new NAHB green-building standards. Those interviews will be on HGTVPro.com Weekly later this year, as well as on the website.
I'm also looking forward to seeing the many new products related to green building. The number of green products seems to be growing exponentially these last couple of years. I guess that means green is here to stay — at least as far as those manufacturers are concerned.
What about you? Are you doing anything to go green? Adding more insulation to the homes you build or remodel? Sticking with Energy Star appliances? Installing solar-energy systems? I'd love to find out what's going on beyond the walls of the Orange County Convention Center, so add a comment to this blog.
I'll see you when I get back!
Posted by Marjie O'Connor, HGTVPro.com Staff at 11:14 PM | Comments (0)
February 7, 2008
Modular Houses and Insurance
I learned something from some of the comments to my previous blog about Systems-Built Houses. It sounds like people who own them sometimes run into trouble getting homeowners insurance because insurers assume that a "manufactured" home is a trailer and therefore not very durable. I didn't expect that at all, but considering the huge gray area in defining manufactured housing, I guess I shouldn't have been surprised.
I'm really intrigued by this now, especially since so many modular houses are being built in the areas devastated by Hurricane Katrina. It will be hard enough for those people to get insurance on their new homes because of the location. Will they have to deal with misconceptions about the quality of construction, too?
How did those of you who have run into this problem solved it? Did you have to provide some kind of documentation from the manufacturer? Get a house inspection by a licensed inspector to verify the strength of the home? I'm eager to hear any and all stories — and I know some homeowners out there are, too.
Posted by Marjie O'Connor, HGTVPro.com Staff at 2:37 PM | Comments (11)
