It was a relatively good year for the roofing industry in
2008 despite the volatility of raw materials and escalating distribution
costs.
It was a relatively good year for the roofing industry in
2008 despite the volatility of raw materials and escalating distribution
costs.
While economic concerns affected most businesses, the
roofing industry nationally flourished as a result of a resilient reroofing
market as well as demand created by storm activities.
In
normal times, our industry operates very close to full capacity. Last year,
though, we experienced modest year-over-year growth in residential roofing,
pushing industry manufacturers to “sold out”
positions.
Despite a good year in 2008, forecasts predict
that the economy is likely to stay weak in the coming months. Even good
companies will feel the impact of recent bailouts, bankruptcies and
buyouts.
However, roofing remains an excellent and
predictable business. In times like these, the secret to success is in knowing
how to weather the storm. While companies may find themselves making some tough
decisions, this could also be an opportunity for them to strengthen their
position in the marketplace. In fact, there has never been a better time to
work on improving customer relationships, enhancing quality, being more
innovative and controlling costs.
Although you cannot
control the weather or the economy, you can control their effects on your
business by watching your market share and paying attention to your pricing.
Rarely is there a winning outcome for companies that get caught in the “price
war” game. There’s more to be gained by marketing value than by trying to
become the lowest-price player in the market.
On the sales
front, we’ve noticed that property owners today are buying smarter by shopping
for products with advanced protection for longevity, better wind protection,
better appearance, better warranty coverage and better systems. In our steep
slope business, we’re seeing continued increases in our designer lifetime
shingles business. In low slope, we’re anticipating continued growth in our TPO
membrane business, which is now the best selling roof system in North
America.
Though the trend toward informed consumerism is
growing in roofing, commodity trends are suffering. With the availability of
information through the Internet and other media growing, property owners are
much more educated about the products and services they buy these
days.
While there always will be a segment that will buy the
lowest price, even those with less discretionary income are leaning toward
buying better products and systems than in the past. The simple fact is they
want to avoid choosing a product that will eventually fail them - and which
will, in the end, cost them even more.
So how does our
industry affect the trend? In general, as long as we keep educating property
owners on the risks and potential problems associated with choosing an inferior
contractor and inferior system with an inferior warranty, customers will spend
the money needed to receive superior value in return.
Also,
we’re realizing the effects of the “green” consumer movement in the roofing
industry, and manufacturers are exploring ways to offer more green options - a
move that likely will result in more investments in green systems and
technologies in the future.
As an industry we have the
opportunity to take a leadership role in green initiatives and to demonstrate
that “green” does not necessarily mean a garden roof. Better defined, it’s
about doing the right thing for the environment, whether it’s recycling
materials, using reflective materials or investing in solar
roofs.
In summary, while the state of the roofing industry
is good, we must remain guarded. All of us in the industry must recognize that
we are in a soft economy with no promise of a quick recovery. Yet, while the
economy certainly is a factor, it is our own performance that will make the
difference. The world can change in a moment, and industry players must remain
flexible enough to make adjustments to meet whatever challenges lie ahead.