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Building Materials Business Owner: Are You the Tortoise or Hare?

Posted by Brandon Weaver | Thu, Aug 08, 2013 @ 10:08 AM

Many industries ebb and flow with the economy. One industry that has been hard hit during the recession is the housing and building supply markets. Am I right store manager, construction workers, painters, architects, etc? Don't think of your business or industry as Usain Bolt (the hare) because there is no real "finish line." Focus on being the tortoise instead.

building supply starts

There is, however, a silver lining in a struggling economy: it can only go up! And recent statistics support this. As the New York Times reports... "builders stepped up home construction and applied for permits to build single-family homes at the fastest pace in five years." Even more good news: these specific permits represent about two-thirds of the market, which means the market is trending upward. Even if the improvement is slow, here is some sugar coating: housing has been the strongest part of the economy in growth terms, says United States economist Jim F. O'Sullivan.

To that point, here's some recent statistics for the last 12 months, according to Bloomberg:

  • Construction spending increased 6.2% before adjusting for seasonal variations
  • Housing outlays increased 1.2% to a $322.3 billion annual amount
  • GDP rose 1.8% with homebuilding accounting for 0.34% of this amount

Likewise, architects across the country report business in various residential sectors is improving. This includes remodels, new homes and commercial construction as well. What's that old saying? Slow and steady wins the race? Walk before you crawl? It's not a marathon, it's a sprint? Whatever analogy you want to agree with, be patient because a rebounding industry takes time. Be like the tortoise.

tortoise and hare building supplyEven with the slowly improving housing market, analysts believe no real, long term recovery will happen unless more jobs are created. More jobs mean more work has been created. Kind of par for the course right? On the other hand, Fox News states with a slowly rebounding home construction industry, builders cannot find enough qualified candidates to fill job openings. I guess if you have to pick your poison, you would rather have more work than workers, than the other way around.

The article also mentions that the problem is most prevalent in states where demand for new homes has recovered the fastest, such as Arizona, California, Texas, Colorado and Florida. After the housing market crash, many of these qualified workers were forced to leave the industry or find higher paying jobs in commercial building. As an example, Hispanic immigrants who filled some of these spots during the boom era, left not only the industry, but the United States altogether.

Much like the hare in the fable that takes a nap and eats breakfast in the middle of the race, your competitors might take their eye off the ball too. Offering customers payment flexibility lets you focus on a pressing desire of theirs and earns you a competitive advantage in the industry. Be like the tortoise, consistent and not complacent, but always pushing forward.

Does your business focus on the residential or commercial building market? Either way, be like the tortoise, not the hare. Don't look for shortcuts. Keep grinding, ride out these tough times and provide service to your customers that make them want to return. Look at it this way: the industry can't get any worse than the great recession, right?

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Topics: Building Materials

Written by Brandon Weaver