The Panel:
Dennis Von Ruden, president, General Equipment Co.
Chuck Hommey, marketing director, Equipment Development Co.
Tom Carroll, president, CS Unitec
Gayle Suiter, sales/marketing administrator, Arrow-Master Inc.
Tim Lickel, product manager, concrete group, Wacker Neuson Corp.
What kinds of changes, developments and trends have you seen in the past year in concrete equipment and what do you expect to see in the coming year?
Von Ruden: Changes, developments and trends in equipment are usually prompted or as a result of market demands. In the past year, the effects of the recession upon general construction and, specifically, any concrete-related segment, have been nothing short of devastating. The current market is flat, but that doesn't mean new product development and innovation are also at a standstill. The challenge for any proactive manufacturer is to utilize this time to best determine what future demands the market will make and what will be required to meet them. Nobody has an accurate crystal ball, but here is what we can be certain of:
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Fleets are getting old and well worn. The customers (rental dealers and contractors) will be looking to replace old, worn equipment with something that is more productive, easier to operate and will return a higher ROI rate faster. Those expectations will not go away. The challenge, therefore, will be to make a quantum leap forward with product design, productivity, operator ergonomics and ROI.
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Customers will also expect value with technology. These two factors will remain analogous to each other. That will be another important challenge for manufacturers: give the customer more value for the money they are spending on technology.
Hommey: Dust collection has become an increasingly important part of what concrete contractors need to have when using concrete equipment such as grinders and scarifiers, which in turn has caused the rental companies to carry more vacuum systems. A multi-purpose vacuum system is an easy add-on rental item when someone comes in to rent a grinder or any other type of concrete surface preparation or repair equipment. Concrete polishing is also a trend becoming more popular in the rental market.
Carroll: More contractors are now accepting work outside of their normal business activities just to maintain jobs for their employees. Some have even begun accepting small- to medium-sized jobs that require fewer personnel and different equipment from what they may currently own. For these instances, some contractors opt to rent equipment, especially for jobs they do not anticipate performing on a regular basis.
Suiter: Stricter EPA regulations. Declining funds for new equipment purchases. Decrease in demand for construction jobs.
Lickel: First of all, in riding trowels, to go more to a power-steered machine, meaning that instead of having mechanical levers that you steer the machine with, I see a market coming to using hydraulic- or electric-powered turn and steer of the machine. What that does for the industry is, with the advent of a laser screed, you are pouring larger pour sizes and more square footage at a time, and it cuts down on the fatigue for the operators. When you're panning with a mechanical steer you are really using a lot of shoulder work to turn the gearboxes and the pans, to steer the machine. With power steer, that eliminates the fatigue and you can sit on the trowel much longer and be more comfortable and productive when you have that factor taken away.
We are introducing at World of Concrete a 48-inch power-steer machine, and other companies are trending the same way.
Has the economic downturn influenced the type of equipment concrete contractors are looking for or how work is done in any way?
Von Ruden: Procedures and methods have not changed in any significant manner because of the current market demand. When the demand does begin to increase in the next 12 to 24 months, customers will begin to search for equipment solutions that offer increased productivity and ROI. This will be influenced by the following factors:
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Equipment fleet age and condition.
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Availability of trained personnel. A lot of the older, more experienced employees are facing retirement. Do the younger people have the necessary experience to help make the market grow?
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A thought process that will suggest placing greater emphasis upon capital equipment that will allow the customer to reduce the number of employees. Contractors will not necessarily want to go back to hiring the same number of employees. New equipment design and function needs to help make this happen.
Carroll: Yes, the economic downturn has influenced the type of equipment concrete contractors are looking for and how the work is done. The concrete contractor is very concerned with purchasing new equipment and when they do purchase, the equipment must demonstrate measurable cost savings and realize a quick return on investment. Additionally, concrete contractors are more likely to rent equipment rather than purchase new equipment, especially for jobs that are outside their normal “comfort zone.” Contractors are also searching for equipment that can perform more than one task as an effort to try to save money.
For example, today's construction methods require the application of a wide range of coatings for floors, walls, ceilings, roofs and industrial applications. Coating types and materials are also numerous. While they all differ, one from the other, they usually all require one common process: thorough on-site mixing.
For small-to-medium jobs, their current large drum mixer is too big for the job and mixing by hand in a small bucket is just not cost effective. On-site mixing is often regarded as time-consuming, tiring work, especially when standing using hand-held mixers. Carrying heavy buckets of mixed material can result in backaches and job-related injuries. A great solution would be a mixing station that allows the worker to mix, transport and pour, all with one unit.
Lickel: Concrete contractors are still using the same screeding methods; they are still using riding trowels and walk-behind trowels. Because that equipment is such a staple now, I don't think you'll see someone going back to using three or four walk-behinds in place of a riding trowel because it's such a labor savings.
If a rental company wants to be a concrete equipment specialist, or at least have a strong presence in concrete, what are the basics it should have in its inventory?
Von Ruden: The first thing that is critical for success is to conduct a market study within the trade area. The study will determine what is being done in terms of projects, who is doing it and what equipment and support are required. Based upon that data, the rental dealer needs to determine what will be necessary in terms of:
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Personnel. How many people, what type of background and experience along with what type of sales and marketing connections are required? How do you measure their success?
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Product and process training. Just because you own the equipment does not make you an expert. How will the rental dealer become an expert? How does the rental dealer maximize ROI from the investment?
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Required equipment inventory. Find solutions to personnel and training and the answers to what type(s) of equipment to purchase will become a lot clearer and well defined. If a decision is made to become some type of specialist within a trade area, the required products will probably include a variety of saws, grinders, planers/scarifiers and related pneumatic tools.
The thing not to do is to start something without a good plan. History has proven that not every dealer can be everything to every potential customer. It's almost impossible to state what specific type of equipment is required until the study is conducted and a response plan is determined and then executed.
Hommey: A concrete specialist for sure would need to have a floor grinder (most likely dual-disc) and a scarifier along with a dust collection vacuum system. The floor grinders can be fitted with many different accessories, but most common would be some sort of diamond grinding blocks and maybe stripping accessories. Scarifiers work best when used with carbide cutter accessories. Other complementary pieces might include a high-speed, turbo grinder along with an edging grinder.
Carroll: The rental company must carry a variety of equipment for the contractor, including a line of electric, hydraulic and pneumatic sawing, drilling and mixing equipment, as well as grinders and polishers for preparation and finishing applications. Another key line is reliable dust-extraction equipment. Contractors are faced with cutting, drilling and finishing a wide variety of masonry materials, including concrete, reinforced concrete, concrete pipe, brick, block, natural stone and more.
A concrete saw line would include hand-held and walk-behind cut-off saws and blades, as well as chain saws and diamond chains. Cutting applications often include walls, floors and columns, as well as sidewalks and roadways — in both wet and dry applications.
A concrete drill line would include core drills and diamond core bits, rotary hammer drills and bits, and more. Contractors need wet and dry drilling equipment for various concrete hole-making applications, from small 5/32-inch diameter holes to 14-inch diameter holes.
A mixing line would include portable hand-held mixers, paddles and mixing stations for mixing mortar, concrete, plaster, grout, drywall mud, decorative concrete coatings and other cement materials. One consideration in this category is that when mixing larger batches, the medium takes awhile to blend and is quite heavy, so portable mixing stands and stations allow mixers to work independently and they can be moved with reduced effort.
A grinding and polishing line would include concrete grinders for surface preparation and concrete polishers for finishing. Removing paint, epoxy, glue and other hard coatings from existing concrete surfaces is also a consideration. Dust-extraction tools, when appropriate, should be offered, as well as powerful vacuums to contain concrete dust.
Lickel: If a rental house wants to enter the concrete market, normally start out with internal vibrators, because typically they have the most applications. It's not an expensive item to capitalize and put in the rental fleet, and it has a good ROI and low failure rate. And small walk-behind trowels. As you gain experience and start to figure out your market locally, move into riding trowels, typically not more than I would say an 1,100-pound, 8-foot machine. Typically in rental fleets you don't see the large hydros, but you do see the 36-inch and the 48-inch riding trowels in the fleet.
When we talk to rental houses that want to start specializing in concrete, the first thing we have to tell them is when a machine comes back, have a proper checklist to make sure the machine is cleaned, arms aren't bent on it and no damage occurred because the worst thing you can do is rent a riding trowel and the arms are bent.
What are your expectations for business in 2010?
Von Ruden: We expect 2010 to be a flat year in both the residential and commercial construction markets. The ultimate fate of the current mortgage and default issues will drive the demand for properties. The real estate markets need to fail and then be allowed to rebound to sustainable levels. Market demand will drive the amount of construction work completed and have a direct effect upon the amount of equipment needed to satisfy these demands. We do not expect to see any appreciable increase in activity until the spring of 2011.
Hommey: Similar to 2009. I don't think it will be worse, but I also don't believe it will be a whole lot better.
Carroll: The business climate for 2010 should improve because construction equipment distributors have finally reduced their inventory and must now purchase new inventory just to supply the decreased demand. In addition, construction equipment that has been continually repaired rather than being replaced is finally wearing out and must now be replaced.
Suiter: We don't expect any increase in volume/sales until the second half of 2010.
Lickel: In the second half of 2010, when some of this stimulus money is supposed to be spent on more substantial projects such as bridges and some of this DOT and civil work, you'll see an uptick in that type of business.
For the full transcript of concrete interviews, visit rermag.com.
