Gaining a 70% Market Share.The UK Experience in Structural Steelwork

QuerĂŠtaro, 4-7th March 2009

Gaining a 70% Market Share The UK Experience in Structural Steelwork

Richard B Barrett President British Constructional Steelwork Association

Topics

• Introduction • Market Share Transformation • Key Success Factors • Bringing it all Together • Summary & Conclusions

Introduction

Barrett Structures Ltd – Non-Executive Chairman 

UK Steelwork Contractor



100% Design-Build



15,000 tonnes per annum



Sales $60m



Single and Multi-story Buildings

Introduction

Barrett Steel Ltd - Director • UK Steel Service Centres

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• 31 Depots in UK & ROI • 450,000 tonnes per annum

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• Sales $600m

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• 25,000 customers

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Introduction

BCSA - President 

British Constructional Steelwork Association



“BCSA President” role is similar to “Chairman”



UK trade association



130 Fabricator members



80 Associate Members

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1980

33.3%

Concrete/masonry/timber

66.7%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1981

35.4%

Concrete/masonry/timber

64.6%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1982

36.6%

Concrete/masonry/timber

63.4%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1983

38.8%

Concrete/masonry/timber

61.2%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1984

40.5%

Concrete/masonry/timber

59.5%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1985

42.9%

Concrete/masonry/timber

57.1%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1986

49.8%

Concrete/masonry/timber

50.2%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1987

51.3%

Concrete/masonry/timber

48.7%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1988

52.8%

Concrete/masonry/timber

47.2%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1989

52.3%

Concrete/masonry/timber

47.7%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1990

50.7%

Concrete/masonry/timber

49.3%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1991

58.1%

Concrete/masonry/timber

41.9%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1992

56.9%

Concrete/masonry/timber

43.1%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1993

62.2%

Concrete/masonry/timber

37.8%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1994

57.7%

Concrete/masonry/timber

42.3%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1995

55.9%

Concrete/masonry/timber

44.1%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1996

61.6%

Concrete/masonry/timber

38.4%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1997

58.1%

Concrete/masonry/timber

41.9%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1998

65.1%

Concrete/masonry/timber

34.9%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

1999

68.0%

Concrete/masonry/timber

32.0%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

2000

66.6%

Concrete/masonry/timber

33.4%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

2001

68.1%

Concrete/masonry/timber

31.9%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

2002

67.4%

Concrete/masonry/timber

32.6%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

2003

69.4%

Concrete/masonry/timber

30.6%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

2004

69.2%

Concrete/masonry/timber

30.8%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

2005

70.9%

Concrete/masonry/timber

29.1%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

2006

72.0%

Concrete/masonry/timber

28.0%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

2007

71.1%

Concrete/masonry/timber

28.9%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

2008

70.1%

Concrete/masonry/timber

29.9%

Market Share Transformation

UK Market Share - Multi-story Buildings (Non-residential)

Steel

2008 1980

70.1% 33.3%

Concrete/masonry/timber

29.9% 66.7%

Key Success Factors

• Technical Issues • Supply Chain • Design-Build • IT Integration • Speed

• Current Hot Topics • Cost

Key Success Factors – Technical Issues

• Steel Construction Institute (“SCI”) • Comprehensive Design Guides • Section and Load Tables • Excellent Design Software • Supporting Universities

• Composite Construction

Key Success Factors – Technical Issues

• Fire • Fire Tests • Design Guidance • Intumescent Paints • Steel is a Fire Engineered Product

Key Success Factors – Technical Issues

• Fire • Fire Tests • Design Guidance • Intumescent Paints • Steel is a Fire Engineered Product

Key Success Factors – Technical Issues

• Fire • Fire Tests • Design Guidance • Intumescent Paints • Steel is a Fire Engineered Product

Key Success Factors – Technical Issues

Key Success Factors – Technical Issues

• Sound and Vibration • New Building Regulations

47 x 147 soleplate with packer 5 mm flanking strip 18 mm chipboard on 45 (nom) Danskin SF battens with resilient strip on 13 mm acoustic quilt (36 kg/m²) Concrete floor slab on SD 225/1.1 decking

• “Robust Standard Details” • Design Aids & Guides

12.5 mm plasterboard on 45 x 38 mm battens 200 x 100 RHS 8.0 edge beam with welded flangeplate 47 x 147 mm head-rail with packer

Key Success Factors – Supply Chain

• Competitive, vibrant, deep, diverse • Large number of competitive fabricators • Output/man 1983=30t, 2006=240t = +6% p.a.

• Bending, Cellforms, Fabsec, Intumescent • Steel suppliers – Service Centres, JIT, Processing • Specialisation • Fabricators focusing on specific sectors

Key Success Factors – Design-Build

• Design carried out by Fabricator • Fixed Price Package • Advantages • More competitive design • Designed for Manufacture

• Optimise choice of steel shapes • IT Integration • D-B Share = 40% Multi-story, 90% Single

Key Success Factors – Design-Build Basic 3-D model Structural design Structural detailing in 3-D Lotting. DSTV files

DSTV clean up Routing, Batching, Prioritising, Material allocation & nesting Add Fit-up scribe data Process data into machine format Make steel

Key Success Factors – Speed

• Fast-Track Construction • Large capacity >1000 tonnes per week • Project Management Skills • One-Stop Shop = Better co-ordination • Steel & Decking

• Steel & Pre-Cast Concrete • “Wet” Trades – pouring concrete

Key Success Factors – Current Hot Topics

• Safety at Work • Off-site workforce is safer • Off-loading of vehicles • Positive Lifting • No men on Steel

Key Success Factors – Current Hot Topics

• Sustainability • BCSA Sustainability Charter • Zero Carbon Buildings • Steel Solutions • Steel & Concrete Structures have same Thermal Mass • School: 40% reduction in CO2 for no extra cost

Bringing it all Together Construction - Raw Material Costs Relative to Inflation Source - DTI

Cost

50

Real Cost Change from 1995 (%)

40 30 20 10 0 -10 -20 -30 -40 1995 1995 1996 1996 1997 1997 1998 1998 1999 1999 2000 2000 2001 2001 2002 2002 2003 2003 2004 2004 2005 2005 2006 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1

Steel Sections

Ready Mix Concrete

Reinforcement Bar

Bringing it all Together Construction - Constructed Component Costs Relative to Inflation 50 30 20 10 0 -10 -20 -30 -40 -50 H 1 19 95 H 2 19 96 H 1 19 96 H 2 19 97 H 1 19 97 H 2 19 98 H 1 19 98 H 2 19 99 H 1 19 99 H 2 20 00 H 1 20 00 H 2 20 01 H 1 20 01 H 2 20 02 H 1 20 02 H 2 20 03 H 1 20 03 H 2 20 04 H 1 20 04 H 2 20 05 H 1 20 05 H 2 20 06 H 1

Real Cost Change from 1995 (%)

40

19 95

Cost

Structural Steel

Insitu Concrete

Fire Protection

Metal Decking

Placed Reinforcement

Bringing it all Together Comparison of UK Steel and Concrete Frame and Floor Costs Various Building Types and Locations

Cost

£170 £160 £140 £130

Concrete Framed Steel Framed Inflation tracker

£158

£120 £110 £100

£111

£90 £80

H 1 19 95 H 2 19 96 H 1 19 96 H 2 19 97 H 1 19 97 H 2 19 98 H 1 19 98 H 2 19 99 H 1 19 99 H 2 20 00 H 1 20 00 H 2 20 01 H 1 20 01 H 2 20 02 H 1 20 02 H 2 20 03 H 1 20 03 H 2 20 04 H 1 20 04 H 2 20 05 H 1 20 05 H 2 20 06 H 1

£70 19 95

£ per square metre (GFA)

£150

Bringing it all Together

Steel Market Share in UK

Sector

%

Offices

71.9

Retail

70.0

Leisure

70.1

Education

68.9

Health

68.3

Residential (multi-story)

26

Steel Market Share in UK

(Multi-story buildings, nonresidential)

19 8 19 0 8 19 1 8 19 2 8 19 3 8 19 4 8 19 5 8 19 6 8 19 7 8 19 8 8 19 9 9 19 0 9 19 1 9 19 2 9 19 3 9 19 4 9 19 5 9 19 6 9 19 7 9 19 8 9 20 9 0 20 0 0 20 1 0 20 2 0 20 3 0 20 4 05

Bringing it all Together 80

70

Steel Concrete

60

50

40

30

20

10

0

Summary & Conclusions

• UK was a “Concrete” Country • UK is now a “Steel” Country • A Series of major initiatives over many years • Design Guides • Solved Fire “problem”

• Proves Markets can be Switched • I wish Mexico great success!

QuerĂŠtaro, 4-7th March 2009

Gaining a 70% Market Share The UK Experience in Structural Steelwork

Richard B Barrett President British Constructional Steelwork Association