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WEBBLog, by Craig Webb, Editor, PROSALES

Weighty, Indeed: You Respond to Our Editorial on How To View Wood

Several ProSales readers have commented on "The Weight of Wood," my editorial in the July issue of ProSales.

Peter Ganahl, president of Ganahl Lumber, Anaheim, Calif. (and featured in this month's cover story), noted my statement that, "We need to regard wood for what it is: one of the many construction supplies and services that we offer … and not just because it's what our daddy sold." Ganahl agreed, adding that wood and wood-derived products accounted for 80% of his company's sales a generation ago and now figure in 65% of sales.

"But here is my concern going forward," Ganahl continued. "If the policies coming out of the so-called green movement in construction are based on a combination of science and economics, we're ready to move to the best products and building methods that get us there. For example, do they reduce energy usage when in place? Are they energy efficient to produce relative to the alternatives? Are they long lasting? Are they renewable? If, on the other hand, the green movement uses the political arena rather than the scientific and economic arenas to move the process, our industry needs to be a strong and reasoned voice that guides the process toward the best policies over the long run."

Meanwhile, Bruce Currie, president of C.A. Niece Lumber Co., Lambertville, N.J., noted: "I have pondered the subject myself, being that some of our best moving items of the last five years are the likes of AZEK, TimberTech and Hardiplank. … We are in a very liberal town, 75% Democratic, many of whom are 'tree huggers.' Do you suppose they think plastic is better for the environment?"

What's your view? Write to me with your thoughts.


Got Trouble With Drug Users and Drunks? Count Your (Relative) Blessings
I've heard complaints lately from LBM executives regarding the legions of potential employees they've had to reject because of failed drug tests. A new study announced Monday indicates just how serious the problem is—and yet how LBM dealers are in better shape than some of their peers. The voluminous report from the federal government's Substance Abuse and Mental Health Services Administration (SAMHSA) estimates that 9% of the workers at building material and garden equipment and supplies dealers have used illicit drugs in the past month. At the same time, 6.8% are estimated to have used marijuana, and 13.2% engaged in heavy alcohol use. An occasional toke or one-night bender isn't the same as substance abuse, of course. In that darker realm, the report estimates that 2.7% of the workers at LBMs have engaged in illicit drug dependence or abuse in the previous year, while 10% were alcohol-dependent or abusers in the same period. The rates for illicit drug and heavy alcohol use range between 13% and 25.7% for carpenters, flooring installers, electricians, and roofers.

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More Resources To Improve Your Yard's Safety Record
John Smith, risk manager at Foxworth-Galbraith Lumber Co., gave ProSales kudos for this month's story on LBM's special challenges overcoming the language barrier to assure the safety of Spanish-speaking workers. At the same time, Smith says we should have cited several other groups besides NAHB as sources of information and training material. His favorites include OSHA, the Wood Truss Council of America, and of course NLBMDA.

UFPI Doesn't See Remodeling Grow as Home Building Slumps
It's the LBM equivalent of the Sherlock Holmes case about the dog that didn't bark. In its announcement Tuesday of financial results for the quarter ended June 30, UFPI noted something important that was missing. "In previous housing downturns, our DIY business picked up as people chose to improve their homes instead of building new," UFPI president and CEO Michael Glenn said. "That hasn't been the case this time." In fact, retail and DIY sales are up only 1.7% this quarter compared with the second quarter of 2006. "We believe that homeowners who took significant equity out of their homes, or whose home values declined due to market conditions, are putting off the larger projects—like room additions and new decks—that would positively impact our business," Glenn said. That's particularly painful, given that UFPI doesn't expect the new-home market to recover until mid to late 2008.

ProSales Wins Three ASBPE Awards
We're pleased to announce that ProSales magazine won three awards from the American Society of Business Publication Editors' Central-Southeast Region. All awards are for articles published in 2006. ProSales won a Gold Award for best regular staff-written column, honoring Chris Wood's "Viewpoint" column. It won a Silver Award for best original research in honor of "New Era," our report on the ProSales 100 (pictured). And it received a Bronze Award for best regular department, in this case the "House Calls" section written by our compatriots at Hanley Wood Market Intelligence. Naturally, we're quite proud that our peers have seen fit to honor ProSales, as they have 16 other times since 1999. But we're more proud of serving you, the reader.

WebbThreads

Owens Corning announced it has reached a definitive agreement to sell its Siding Solutions business to Saint-Gobain for $371 million. The sale includes the company's Norandex/Reynolds distribution business with 153 U.S. distribution centers in 38 states. Three vinyl-siding manufacturing facilities in North America—located in Claremont, N.C.; Joplin, Mo.; and London, Ontario, Canada—are also part of the transaction.


Reminders

• Check out the latest edition of our exclusive Web column "Rader's Edge," in which industry consultant Chris Rader argues that one price definitely does NOT fit all.

• Take advantage of ProSales' new, free Webinar on installed sales, "Five Pillars to Installed Success," created for us by ProSales columnist Mike Butts.

• Can't find your July issue of ProSales? Click here for the online table of contents.


Do you have a question, a tip, or a sage piece of wisdom? Feel free to contact PROSALES' editor, Craig Webb, at cwebb@hanleywood.com.

And don't forget you can find previous WebbLogs now online!

In this newsletter...


Pulte Warns of Big Loss
Pulte Homes expects to post second-quarter losses of between $2 and $2.10 a share, it said in its preliminary earnings release after market close Tuesday. Contributing to the loss were closings that fell 40% year-over-year as well as impairment and land-related charges it is still adding up. Pulte expects the charges to fall in the $740-to- $770-million range, accounting for between $1.85 and $1.92 of the per-share fall.
complete story

Builder Confidence Index Falls Again in July
The National Association of Home Builders reported today (July 17) that its NAHB/Wells Fargo Housing Market Index fell four points to 24 in July, its lowest level since the recession of 1991.The measure of builder confidence was well below what was expected on Wall Street, which was expecting an index number of 27.
complete story

Economists Divided on Fed's Next Move
The Federal Reserve will leave interest rates unchanged for at least another year, according to a USA TODAY survey out today (July 17) in which economists predicted a modest pickup in the economy and a gradual decline in inflationary pressures. But the prediction on the Fed is based on a median, the midpoint, of the answers, and opinions vary widely. Some of the economists expect rate increases, others expect cuts and others are in the middle, expecting nothing from the Fed at all over the next year.
complete story

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Conference: October 9-12, 2007
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