US Market Update

Posted by Dave Farley
July 16th, 2012

What does a trade show on the skids, mathematical equations, and NHL players loving Kelowna have in common? Read below to find out.

I was in San Francisco last week for the Pacific Coast Builders Conference (PCBC). The city was abuzz, with restaurants, car rentals, and hotels at near capacity, so I was excited hoping that the show was turning the corner after being on life support the last five years. Well, like most things, my excitement soon turned as I realized all the buzz was for the Google app conference that was happening at the same time as PCBC. In fact, Google has taken over occupying three of the four massive building that make up the conference center. As late as 2005, PCBC filled these four buildings with the latest in construction and building products supplies, now PCBC is confined to ¾ of the south hall.

That being said, PCBC this year had all the excitement of a party in a kitchen because the small size of the place seemed much busier than it actually was. Show organizers listed some 5000+ attendees at this year’s event, which provided a good venue for networking between builders, architects, and suppliers from the Northern California market. It’s too early to tell what the change in location to San Diego will do to attendance next year, but suffice it to say, the show could not survive another year in San Francisco.

Last year, I did a quick survey of members to see how their “Bid-to-Close Ratio” and see how the downturn had effected their bottom line. As discussed, the ratio last year was skewed, with members bidding on a high number of projects, but closing with far less frequency than in the past. Most blamed the market conditions at the time, as buyers were checking prices with alternative suppliers, and manufacturers were said to be “giving jobs away” just to stay in business. This time, it seems that the bid-to-close ratio is beginning to return to normal, especially with higher value manufacturers in the millwork and engineered wood products sectors. One manufacturer that I spoke commented that while they are signing more contracts, delays on project start dates have impacted the ratio. The bid-to-close ratio is a benchmark for the overall health of the industry and having this ratio gradually return to historic averages is, I believe, reflective of an improving residential and light commercial construction sector.

Finally, on the celebrity front, it seems that we have a few members who like to rub elbows with the rich, famous, and powerful.   For example, Kelowna based BC Wood member, Norelco Cabinets, has developed a niche market building custom kitchens, high-end cabinetry, and millwork for NHL hockey players including Wade Redden, Jerome Iginla, and most recently that ginger-haired grinder from Philadelphia, Scott Hartnall. It turns out that Kelowna has become a hotbed for NHL players to live and train during the summer months and a fraternity of players have built homes on Okanagan Lake over the past few years.

Also hobnobbing with the rich and famous is Judson Beaumont of Straight Line Designs. His use of beetle kill pine in recent projects creating one of kind furniture and wall panelling attracted the attention of the Minister of Tourism and Trade, the Hon Pat Bell who stopped by his shop in Vancouver this past week to view some of Jud’s latest designs. It seems that Jud has become a favorite of Victoria’s political elite as he also was commissioned to build a beetle pebble wall a few years back for former premier Gordon Campbell.

 

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