Bowens Builders Bulletin June 2016

BUILDERSBulletin B

June 2016 Volume 29 No. 5

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EXPERT ADVICEBowens Making It Happen

INDUSTRY NEWSThe Season For Apprentices

WHAT’S NEW?Milwaukee Power Tools

Exclusive to Bowens The latest innovative pre-finished natural timber claddingRead more on page 4

JUNE 2016BUILDERS BULLETIN PB2

A Word From John Bowen

There has been a lot of discussion in recent months about the future of the timber, hardware & building supply industry. Of course, the motivation for analysis and theories surrounds the impending dissolution of the troubled Masters / Home Timber & Hardware businesses. Since January, when Woolworths’ Chairman confirmed they would be giving up on the Australian hardware market, everyone seems to have something to say.

The Masters experiment made sense in the beginning. Australia’s then largest and most dominant grocer, liquor and consumer retailer was preparing to beat-up on Wesfarmers, who had recently purchased a calamitous supermarket chain and a collection of unloved retail brands. Additionally, the Bunnings Boxes had the profitable retail hardware market all to themselves.

As we have read many times, Woolworths smugly dubbed their initiative ‘Project Oxygen’. They intended to suffocate Bunnings, Wesfarmers’ cash cow, thereby impeding Coles’ ability to invest in supermarkets. With the GFC still fresh in the minds of nervous bankers it was an aggressive, brutal strategy that seemed to make sense.

What went wrong has been the subject of countless newspaper columns. People a lot more intelligent than I have examined the facts in detail and many have published their findings.

From day one Woolworths missed the mark, flagging their intention to break ground on their first store two years later. Arguably, it was their largest failing. They had pre-warned the best returning large box hardware retailer in the world, who used this period to spend heavily on land acquisitions and then outbuild their new competition, who found themselves fumbling around on secondary sites.

Their second mistake was to position themselves as close as they could to established Bunnings stores; in retrospect, not the most sensible move. Bunnings has been Australia’s most trusted retail brand for a decade and Masters were competing with them head on. Retail consumers are loyal to their favourites, so when given a choice they chose what they trust. When Masters did succeed in dragging people to their stores, they were presented with unfamiliar products. Again, Bunnings were gifted an advantage.

Masters also made some clumsy mistakes on products more generally, including matching merchandise with the wrong seasons in the U.S. Beyond it all, the in-store experience just didn’t seem to match-up well with the alternatives.

Woolworths also stuffed things up for the independent sector, of which Bowens is a participant and strong advocate. The mess they leave looks something like this: by ‘poking the bear’ they have made the most dominant player even stronger. They have broken up the independent sector by buying stores and wholesalers, while also enticing the third supermarket player to join the party. Over the journey their supermarkets have fallen behind, management has been upended, an electronics division was off-loaded on the cheap and even the Chairman and many Board members have been moved on. To top it off they also dropped a bit of spare change.

Woolworths and its US joint venture partner, Lowe’s, invested north of $3 billion in their hardware dalliance. At the time of the announcement to sell or

close their operations, the group’s accumulated losses topped $500 million; it will finish a lot worse. While Masters has been the headline act, the more significant matter for Bowens and other Independents has been Woolworth’s involvement with Home Timber & Hardware (HTH). Initially, via the purchase of Danks, HTH’s franchise owner, and then through their acquisition of various HTH Stores across the country, they have quickly accumulated a significant footprint of 44+ strategic locations across Australia. In Victoria these include Taits, Hardings Hardware and Belmont Timber. Citi Bank is now working hard to divest them all.

According to a report by DGC Advisory, more than 980 independent retailers have quit the market in the past three years. Should market dynamics remain unchanged, the same report estimates another 1,820 independents are likely to disappear by 2025. (Financial Review, 17 May 2016)

We like to romanticise about our love and support for independents, however our actions betray us. As a nation we reward size and it is clear we do not choose, so much as follow. We can’t visit a shopping centre or retail strip without being drawn into the web of Australia’s very special duopoly – bananas from Woolies, deodorant from Coles, beer from Liquorland, wine from Dan Murphy’s, a hammer from Bunnings, cheap shoes from Kmart, a drill bit from HTH, overpriced printer cartridges from Officeworks, a plastic toy from Target, a pillow from Big W, petrol from Coles Express, a plant from Masters – we have given them our wallets, if not our hearts. If Independents do disappear, it won’t only be the business owners and their staff who suffer. A multitude of suppliers – manufacturers and wholesalers, big and small – will vanish as well. With economies of scale and leverage, the Corporates have a disproportionate trading advantage over those who keep them in stock. The threat of being ‘deranged’ and having no other channels to market is real, if the Independent sector doesn’t reverse its shrinking trend. Of course, it isn’t only an issue for the hardware industry, it has been happening for many years in the grocery sector, fashion retailing, fuel … the list goes on.

The question being asked by the ACCC is whether the industry should support Metcash’s bid to purchase the Home Timber & Hardware Group.

The ACCC’s investigation is focused on the impact on competition. In their letter requesting submissions they looked for the industry’s views on:

• Whether Metcash and HTH compete closely in wholesale supply to hardware stores

• What or who are the most important factors in the setting of wholesale and retail prices and service levels for hardware, building supplies and home-improvement products, and what is the impact of Bunnings

• To what extent would a combined Metcash-HTH increase wholesale or retail prices, or degrade service levels or range.

They are big questions. It is a bit dramatic to say ‘our industry hangs in the balance’, however it is an important time for the sector; I am looking forward to playing a part in its next evolution. Life would be boring without change.

John Bowen, Managing Director

Get on Board. Fight for Independents.

JUNE 2016BUILDERS BULLETIN 3PB

Expert Advice

MAX0320

NEW ANGLES ON TIMBER CLADDING IN NATIONAL CONSTRUCTION CODE CHANGE

About 18 months ago I had a call from a builder on the Mornington Peninsula and was surprised to hear a building surveyor had rejected his plan to install a shiplap cladding vertically because it did not conform to National Construction Code (NCC). I could only respond by saying I had not heard of this ruling and had known claddings had been used vertically on many occasions.

However, the code was quite specific in as much it required profiled timber boards, with a tongue and groove, had to be fixed with the tongue edge up and did not recognise a practice of installing profiled timber boards vertically or diagonally. As I understand it also showed profiled timber cladding in picture form, but only in a horizontal situation.

I contacted Boris Iskra, Forest Wood Products Australia’s (FWPA) manager of codes and standards He too was not aware of this situation.

After contacting the builder, Boris, under the banner of FWPA submitted a Proposal for Change (PFC) that sought a modification of the NCC to permit the installation of vertical and diagonal timber cladding as Deemed to Satisfied (DTS) solutions. The official change came into effect on 1st of May 2016. Now designers can specify diagonally and vertically aligned timber cladding with the same DTS simplicity as traditional horizontal applications.

As I stated above, in practice vertical and diagonal installation of timber cladding has been used in Australia for many decades and has performed well as a weather protection element when installed as recommended by industry guidelines. In fact we (Bowens) issue our Suggested Cladding Installation Guidelines when an order is placed for this product whether used horizontally or vertically. We also have Suggested Installation Guidelines for Baltic Weatherboards as well.

Developed in consultation with industry, the PFC incorporated details of current best practice methodologies to enable building surveyors and certifiers to refer to the modified NCC Vol.2 to demonstrate regulatory compliance, thereby removing any uncertainty around the installation of vertical and horizontal cladding.

Boris Iskra went on to say “the provision of a DTS has clarified the acceptable installation of external non-horizontal timber cladding and ensured the proven traditional installation methods are undertaken in a sound, technical manner to achieve the required performance for external timber cladding”.

For our part, we are proud to help bring about a change that makes life a little easier for our clients.

I acknowledge some of the statements above are taken from an article published by Wood Solutions design and build issued on the 11th of May 2016.

If you would like more information about this subject or technical support, Jeff Harvey is available on 0412 550 740 or email [email protected]

BOWENS MAKING IT HAPPEN;


Product Of The Month



Featured

Building with Bowens UrbanECO™ The latest Innovative pre-finished natural timber claddingIn this month’s Building Bowens segment we caught up with Gerry Brouwers who has been a registered Master Builder for over 40 years. Gerry is currently building a house for his daughter in Montrose. Gerry also designed the house and is aiming to build something really special.

Once it was decided that the house was to be weatherboard, Gerry contacted his Bowens account manager, Sam Borthwick from the Croydon branch to discuss his options. Sam suggested a new product that Weathertex had just released, UrbanECO™, which is an innovative pre-finished natural timber cladding.

Gerry visited the Weathertex stand at the recent Bowens Building and Innovation Expo to learn more about the product. He was able to ask questions of the Weathertex reps and look at their UrbanECO™ installation.

At the Expo, Gerry spoke to Gavin Wilson, Regional Sales Manager at Weathertex who explained that UrbanECO™ comes factory painted in the top 10 most popular COLOURBOND® colours such as Dune®, Paperbark® and Ironstone®. Gerry thought this was a great feature as he initially thought it might only have come in a few colours and limit his choice.

All Weathertex products are manufactured from locally sourced recycled hardwood timbers and have a better than zero carbon footprint. Also, they’re the first manufactured product in the world to receive Global GreenTag Platinum certification for their natural range and Gold for their flat primed boards and cladding.

A big plus for Gerry was that UrbanECO™ comes with a 15 year warranty on the paint against blistering, flaking or peeling. There is also a 25 year warranty on the planks not to rot, split or crack.

Weathertex, which is an Australian owned company, can guarantee these warranties as they have tested them in real world conditions at their R&D department in the Newcastle factory where their products have been made for over 50 years. These warranties provide peace of mind to both the builder and the home owner.

It was very valuable for Gerry to be able to meet the suppliers at the Expo and it was at this point that he was able to go ahead with an order, confident knowing it was the right product for the job. It was the first time that Gerry had visited the Expo and he says; “It was amazing. I will be there the next time that’s for sure and hopefully I’m lucky and win the car!”

The house that Gerry is building is on a sloping block and, on one side, its over 9 meters high. Gerry was very concerned about the costs of scaffolding needed, not only for the initial painting but also when painting was required in 7 - 8 years’ time. The fact that UrbanECO is already painted and with a 15 year warranty, really made it the perfect choice.

Gerry’s account manager, Sam Borthwick says that, “innovative products like UrbanECO™ are very important to all builders. It comes down to the old saying, “build smarter not harder”. With pre-finished products, it’s less trades on site and faster install. You are able to get cladding on the wall that is pre finished painted and not need to get a trade in, which is saving a massive amount of time.”

Gerry has been a Bowen’s customer for many years and one of the things he really likes is the consistency of staff. “It’s not like other companies where they are often changing staff, it’s hard to build personal relationships.” says Gerry. At Bowens, he can get to the know people and build long lasting relationships.

• Pre-finished in 10 COLOURBOND® colours

• No painter required

• Lightweight and easy to install

• 15 year warranty on the paint

• 25 year warranty of the boards

• Environmentally friendly

• Less than zero carbon footprint

• Australian made and owned

• Exclusive to Bowens

PROJECT HIGHLIGHTS

UrbanECO™ is an exclusive to Bowens product. For more information, talk to your account manager, visit a store or visit weathertex.com.au

Scan the QR code to

watch the video

The house that Gerry is building is on a sloping block and, on one side, its over 9 meters high.

Gerry was very concerned about the costs of scaffolding needed, not only for the initial painting but also when painting was required in 7 - 8 years’ time.

Gerry contacted his Bowens account manager, Sam Borthwick from the Croydon branch to discuss his options.

The product comes with a joining strip which is pre painted in the same colour as the planks.

The fact that UrbanECO™ is already painted and with a 15 year warranty, really made it the perfect choice.


UrbanECO™ is very easy to install. Gavin Wilson explains that; “you just need to use standard ring shank gun nails. It goes direct to frame and you don’t need to batten it out. There isn’t any extra accessories required. It is a concealed fix so there isn’t any patching that is needed afterwards.”

The product comes with a joining strip which is pre painted in the same colour as the planks. The joining strip simply clips onto the end of the plank so you can join off stud. You don’t need to cut the planks which is important for a pre-fished product. This also speeds up the install time.

Like all Weathertex products, being made from hardwood timber you don’t need any special tools. Gavin jokes that if you had to, a hand saw and a hammer could do the job!

Bowen’s delivery drivers also make Gerry’s job easier. As Gerry says; “if you want to have a crane delivery, that’s no problem. If you want one section delivered on the left hand side and the other on the right hand side, there is never any complaints. They just put it there where you want it. That keeps all the tradies happy and if the tradies are happy, then the builder is happy. So why would the builder buy from anyone else but Bowens?”



Industry News

‘Apprentice season’—our light-hearted term for the lively weeks that run from March to May—came to an exciting conclusion on Friday 6 May at the Melbourne Park Function Centre with the Apprentice of the Year event, with over 700 in attendance and the major awards presented by Victorian Skills Commissioner Neil Coulson.

Hamish Rose, a 28-year-old carpentry apprentice from Ballarat, became the 2016 State Apprentice of the Year, and will now advance to represent Victoria at the annual Excellence in Building and Construction Awards at Parliament House in Canberra on 24 November.

Conducting our own annual Apprentice Awards programs is hard but rewarding work. It is a valuable exercise to focus our attention throughout Victoria on recognising the next generation in building and construction. The search can be exhausting, but it’s energising at the same time. Nurturing the remarkable young men and women who have committed themselves to careers in building the cities and towns in which we live is one of the smartest ways to help ensure the health and vitality of the state economy, as well as the strength and productivity of our industry, which is Victoria’s second-largest full-time employer.

We cannot risk taking for granted the passion for building that those of you already established in your careers feel. It needs to be shared and encouraged among others who have less experience than you, and who have much to discover about how rewarding a career in building and construction can be.

Our annual series of Apprentice Awards is designed to help achieve this. Over the weeks since March, Master Builders visited

RADLEY DE SILVACEO, Masters BuildersAssociation of Victoria

places like Traralgon, Bendigo, Mildura, Warrnambool, Geelong, Benalla and Ballarat to celebrate achievements in the Regional Apprentice Awards series, and reward young people for pursuing their careers with seriousness and determination.

The pool of apprentice talent remains deep; the enthusiasm among employers educators, colleagues and family supporting them that Friday was an excellent demonstration of the valuable resource our state enjoys. This year once again, women demonstrated their strengthening numbers and equal talent in our industry, with several female apprentices winning awards, including Ebony Griffin, a carpentry apprentice from Beaconsfield, claiming Female Apprentice of the Year. Ours is a sector in which both women and men can thrive in rewarding careers. And if we can achieve the universal trades registration requirement Victoria very much needs, their skills and productivity will be ratcheted even higher.

These are indeed exciting times to witness the growth and maturing of our industry. It benefits us all. In construction, our obligation is to foster young talent to make it the best it can be.

The Season For Apprentices

Hamish Rose, 2016 State Apprentice of the Year will now advance to represent Victoria at the annual Excellence in Building and Construction Awards.

BUILDERS BULLETIN10

What’s New?

JUNE 2016 11

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Product Description Length Code

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Structural F8 C/D Plywood* 2400 x 1200 x 25mm PST252412

Non Structural C/D Plywood 2400 x 1200 x 9mm PNCD092412





**Not available at all stores

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Weekend deliveries and terms and conditions apply

Documents

Bowens Builders Bulletin June 2016