Being in the metal construction game these days is not for the faint of heart. A combination of overbuilding, tight credit markets, a slow economy and people simply not wanting to spend (or wanting to spend as little as possible) has made business tough to come by. Ask any contractor what it's like to be in a competitive bid situation and he'll tell you it's not pretty.
“It’s all about the number,” says Gary Hedrick, owner of White Hawk Inc. in Marietta, Ga. “That market has been bloody. It’s been an ugly market.”
Yet White Hawk, primarily a subcontractor, has managed to stay away from that fight by working on design-build projects with general contractors.
Some of our Top Metal Builders did better in 2010 than in 2009, and for others they’re expecting a turnaround in 2011. They all face challenges, yet they all manage to maneuver around them. That’s why this year’s listing is as much a tribute to these contractors’ resilience as anything else.
“We’re committed to being more flexible. If the recession taught us anything, it’s that flexibility and creativity are essential for a business’s survival,” says Wayne Stellmacher, president and CEO of Keller Inc., Kaukauna, Wis. “We’re concentrating on new markets, following industries that are doing well, and expanding our sales force and product offerings. We’re confident that the recession is over and it’s time to rebuild.”
It’s this kind of approach that allows these contracting businesses to not only stay afloat, but position themselves for when the market rebounds. A common theme for companies working on improving their businesses in the interim is a focus on relationships.
“In the construction industry, making the sale and constructing a building takes months, even years, to develop and cultivate,” says Craig Zokas, president of Schonsheck Inc., Wixom, Mich.
Mark Carter, co-owner of Sure Steel Inc., Sandy, Utah, adds: “We continue to try and provide the absolute best service and professionalism for the most cost effective price. Additionally, we are entrenching our existing relationships and building new ones by adding as much value to our projects, the project team and owners as possible.”
Expectations are mixed on how 2011 will turn out, but Zokas says the past few years have created a pent up demand due to building plans being put on hold. “We see things starting to loosen up a bit. Companies seem to be anticipating improved economic conditions and are considering expansion plans.”
Hedrick echoes a similar sentiment: “We’ve seen some expansion to factories being looked at that we haven’t seen since ’05, ’06. They’re just in the thinking stage right now, but it’s a good sign they’re at least considering expanding. I think we’re starting to see some confidence that the economy is moving in the right direction. I don’t think it’s moving at breakneck speed but it’s certainly showing signs.”
According to Stellmacher, change is already underway, including new construction on the commercial side, rather than just remodels or additions to existing facilities.
There are obviously obstacles. For many, a lack of financing is holding projects back, even when a client is ready to build. Steel prices have been increasing as well, and unqualified bidders may be cutting into the pie with unrealistically low offers.
In this market, though, the lesser qualified and competent companies may very well not make it. “We continue to see steel erectors go out of business each week,” says Carter. “The current market is tough and there are a lot of companies making some bad business decisions on how they are estimating work.”
“We continue to see steel erectors go out of business each week,” says Carter. “The current market is tough and there are a lot of companies making some bad business.
With the following listing of Metal Construction News’ Top 100 Metal Builders (ranked by 2010 tonnage), we give you a glimpse of contractors from all over the country who are finding a way to make their businesses work in an economy where only the strong survive.
