Overcoming the challenge: our exclusive look at what other producers are doing may help you...

The economy's up. The economy's down. How is a manager supposed to plan? Most producers don't have a crystal ball to help them predict the future of their operations, let alone how the economy as a whole will affect them. However with help of our readers, THE CONCRETE PRODUCER has found some

A recent survey conducted of readers and attendees of the World of Concrete provides the industry a glimpse into the immediate future of the concrete production business. If this year's attendance at the World of Concrete is any indication, business should be good. It was the second largest show in its 28-year history with more than 73,000 registered attendees. Many of these folks took time during the hectic week to share a glimpse into their business expectations and this will affect their buying decisions. Details of this report are scattered throughout the next couple of pages.

So what does this mean for your business? According to a recent report, FMI's Construction Outlook--First Quarter 2003, the economy is expanding, albeit at a slow pace. Construction volume will not grow faster, or even as fast, as the overall economy as it usually does during the early years of a new business cycle, states the report. "Therefore, we are looking for a 3.2% gross domestic product growth, and yet we are forecasting a slight decline in total construction volume in 2003," says the report compiled by Timothy D. Aylor, construction economist with FMI in Raleigh, N.C.

The outlook indicates that commercial sectors should start to turn around in the middle of next year. The U.S. House of Representatives approved a terrorism insurance bill in November 2002, which will give insurers a federal backstop of tens of billions of dollars to help cover terrorism and will make terrorism insurance easier and cheaper for real estate developers to obtain.

And public-sector construction is expected to perform similarly to residential construction in that a strong year is expected, with some volume decreases in sectors like highway spending. These decreases will be driven by growing federal deficits, severely strapped state budgets, and a Republican Congress that is more likely to tighten purse strings.

Conquering challenges

Every producer, no matter how large the company, has several challenges that must be overcome in order to continue a successful business. "I attended the World of Concrete show this year to get educated on the latest information and technology that was displayed and shared," says Ryan C. Dunning, who works in quality control at Knight Settlement Sand & Gravel LLC in Bath, N.Y. Dunning has the honor of being featured on the cover as he was the winner of the annual cover contest. His name was randomly selected from a host of entrants. You can follow him through this guide, and find listings of products and manufacturers that meet all of your production needs.

"This year our company faces many challenges," says Dunning. "A few that I am personally responsible for are consistency in concrete delivered to our customer, implementing new batching procedures, and reorganizing company structure."

It seems that Dunning--as well as many other producers--are updating antiquated systems or adding computerized systems to their plant. According to the Hanley-Wood 2003 Buying Practices Study, the concrete production industry is about to leapfrog into the next century. Only 59% of respondents currently use batch plant automation equipment, 46% use batching software, 42% use radio communication equipment/software, and 23% use networking/data sharing software. These numbers will surely increase as more producers look to find ways to increase productivity and improve quality control.

Dunning's interest in staying current on important trends and new products is shared by other show attendees. In fact with the growth of interest in self-consolidating concrete and high-performance concrete, there's a renewed interest on ingredients.

Even with the high level of interest, there's still an implementation time lag. Producers tend to be very conservative when it comes to trying new ideas. This fact of loyalty was confirmed in THE CONCRETE PRODUCER'S Buying Practices Study. The respondents indicated strongly that brand name awareness is an important purchasing influencing factor.

This is especially true when it comes to purchasing concrete making ingredients. Survey respondents indicated that for admixtures (62% of responses), cement (59%), and specialty cement (50%), specific brand names are an important factor.

When selecting concrete materials/additives--like admixtures, cement, fly ash, integral color, or specialty cement--product quality, checking in at 86%, is first and foremost on the survey respondents' list of important factors. Next on producers' minds are product availability (82%), ease of application (77%), price/value relationship (76%), technical support (75%), and past experience with the brand (75%). The manufacturer's reputation or brand image ranked lowest (62%) of items considered when selecting an item to purchase or lease.

Getting Information

"I acquire new information via magazines, benchmarking with other producers, and by attending industry events like the World of Concrete," says Dunning.

And to get immediate information about a product that was seen in a magazine article or ad, most turn to the dealer/ distributor for information. 61% of respondents say that they phone or fax the dealer/ distributor, while 47% say they phone or fax the manufacturer. Only 9% personally visit the dealer/distributor.

Nearly three-quarters of the respondents to this survey use the Internet for industry or product information, and nearly all plant locations have access to the Web. This need for Web information is apparent in all of the lists that you'll find in the upcoming pages. The editors have worked hard to include Web site addresses for many companies and organizations so that you can get instant access to the product or service.

The best crystal ball that a producer can turn to is reports from the industry. By keeping up-to-date with current technology trends and tips on how to run a better business, he can ensure the stable future of his company.

A Producer's Top 10 List

So, it's not quite David Letterman, but here's the list of the top equipment that is currently owned or leased by respondents to THE CONCRETE PRODUCER'S Buying Practices Study.

1. Front-end wheel loaders: 80%

2. Trucks--pick-up: 74%

3. Batch plants--stationary: 74%

4. Dust control systems: 69%

5. Forklifts: 67%

6. Water heating/cooling systems: 60%

7. Conveyors: 59%

8. Bin level indicators: 55%

9. Mixer trucks--rear discharge: 55%

10. Vibrators: 54%

[GRAPHIC OMITTED]

Reclaiming Systems Rarely Used

Acquire/replace timeline

No answer           37%
Within 2 years       5%
2-5 years            6%
More than 5 years   18%
Never               34%

Currently own

1 system      13%
2-3 systems    1%
4-6 systems    3%
No systems    83%

Although environmental
concerns
are often at the
forefront of many
producer's minds
purchasing or
replacing ready-mixed
reclaiming
systems is not a
high priority.

Note: Table made from pie chart.

Truck Selection Factors

Importance when choosing a brand

Overall dependability                   91%
Parts availability                      90%
Ease of maintenance/serviceability      82%
Overall dealer support                  81%
Past experience with brand              78%
Dealer reputation                       74%
Product features                        73%
Manufacturer's reputation/brand image   70%

When picking
out a new
truck, producers
look at
their long-term
equipment
needs. Financing
arrangements
ranked lowest
on the scale,
with only 35%
of respondents
indicating that it
was an important
factor.