Contractor Advantage January / February 2010 by Espress Labs Inc.

Contractor Advantage COMPLIMENTARY

C a n a d a’ s

January/February 2010

M a g a z i n e

f o r

P r o f e s s i o n a l

C o n t r a c t o r s

Smart Home AUTOMATION

Plus: INTERIOR PAINT BASEMENT BUILD-UPS LUMBER TRENDS GARAGE INNOVATIONS KITCHEN RENOVATIONS

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January/February 2010 Vol. 16 No. 1

Contents ®

Castle Building Centres Group Ltd., with building supply outlets in every province, is Canada’s leading supplier of lumber and building materials to professional contractors, builders and renovators. Publications Mail Agreement #40006677 Return undeliverable Canadian Addresses to: 6375 Dixie Rd., Suite 400 Mississauga, Ont. L5T 2S1

Editorial Director Castle Building Centres Group Ltd. Diane Jones Managing Editor Paul Barker Art Director James Wardell Contributors Nestor E. Arellano Jay Arthur Patricia Atallah Mark Beckham Lawrence Cummer Paul Rhodes John G. Smith Paul Welch Advertising Enquiries Vendors whose products are carried in Castle Building Centres stores have the opportunity to advertise in

Contractor Advantage C a n a d a’ s

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P r o f e s s i o n a l

C o n t r a c t o r s

For more information or to reserve space in the next issue, contact: Diane Jones Advertising Manager, Phone: 905-564-3307 Fax: 905-564-6592 E-mail: djones@castle.ca Published and designed exclusively for Castle Building Centres Group Ltd. by Business Information Group Material Contact: Jessica Jubb 416-510-5194 Copyright 2010

Features Smart home automation / 22

This evolving technology is becoming more and more popular with consumers and one that contractors should become familiar with.

Brushing up on interior paint / 30

Keeping abreast of the latest trends, while remaining true to painting basics will help contractors protect profit and reputation.

Basement basics / 38

There was a time that basements were an after thought in home renovation, now that has all changed. Our how-to feature explains why.

Garage makeovers / 44

Homeowners are increasingly looking for ways to makeover the garage in order to create an alternative living space.

A recession-proof business / 48

Cost-effective kitchens can provide a stream of work for the contractor. Kitchen facelifts rather than expensive overhauls are now the norm.

Fighting the beetle and the damage done / 56

Canada’s lumber industry is being attacked by everything from insects to a struggling housing sector, but contractors can find some hope in the mix.

Departments NEWS WATCH / 5

Construct Canada coverage

NEW PRODUCTS / 9

New and improved products

LEARNING CURVE / 15

Call it Marketing 2010

BUSINESS STRATEGIES / 17

Business growth through computing

SMART MONEY / 18

International Financial Reporting Standards

ECONOMICS 101 / 20

Buckets versus pipelines

CASTLECARE / 62

Controlling risk management

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News Watch

Project Management Takes Hold By Paul Barker

Photos: Paul barker

Tom Stephenson has a theory about the need for proper planning on the job site. Take it away, says the Coordinator for the Centre for Construction & Engineering Technologies at George Brown College, and you will likely find dissatisfied clients, shoddy work, callbacks and budgets that swing out of control. At the HomeBuilder & Renovator Expo held in Toronto in early December, Stephenson hosted a seminar that focused on the importance of contractors using a different type of tool, namely proj-

ect management software. There are two approaches a contractor can take in the project management sphere. The first is to be reactive, which Stevenson defined as the act of fighting fires on a continual basis, spending money, reacting as events occur and letting “circumstances run the job and run you.” Proactive project management, on the other hand, ensures that the job is proceeding as planned. “Customers have more expectations than they ever have before,” he said. “I know today that we would not get away with what occurred 25 years ago with regard to scheduling and keeping clients up to date. Expectations over time have risen.” There are, he adds, people who are excellent at “putting out the proverbial fire,” however the problem is they are under enormous pressure and have a lot of stress in their life: “When you react, you do not have time to think about the next project because you are too busy fixing the current job. It is a common trait, particular with small to medium sized businesses. There is a way to minimize problems.” The goal of Stephenson’s session was to provide an understanding of the tools and techniques used to manage and successfully complete construction projects profitably. “The project management theme here is that it is all about integration of the following: tools, people, processes and best practices,” he said. “The importance of planning cannot be underestimated.” During the seminar, he conducted a demonstration of a typical renovation project in which Microsoft Project 2003 was used to Tom Stephenson (top) discusses the virtues of project management, while David Miller of IKO Industries Ltd. (middle – left) and Mike Geoghegan of Amoroof Export, a division of IKO, were among the exhibitors at the annual event.

schedule tasks and track the overall schedule. The key, said Stephenson, is installing relevant and timely information into the program. For example, a typical application would contain information such as, cost overruns should they occur, scheduling delays, the status of other sub-trades involved in a particular renovation and specific project goals. “Do not dig yourself into a hole that you cannot get out of,” said Stephenson. “Utilize the tools available and implement a corporate plan for managing your projects.” Homebuilder & Renovator Expo, PM Expo, DesignTrends and Concrete Canada are part of the annual Construct Canada conference, which this year included 1,050 exhibits, 200 presentations and hundreds of new and green products for the construction trade.

CanWel buys Broadleaf CanWel Building Materials Income Fund has acquired Broadleaf Logistics Company for $50 million. “The combination of our two companies will add significant value to our customers,” said Fund Chairman Amar Doman. “We will be integrating the Broadleaf business with our building materials division, the new CanWelBroadleaf division. We are also very fortunate to have high quality employees from Broadleaf join us at CanWel as we build what we believe will be a very exciting company. Our conversion out of an income trust structure back to a regular corporation, together with the concurrent equity offering, increases CanWel’s flexibility, strengthens our balance sheet and allows us to carry on paying a dividend to our shareholders.” Broadleaf is a seller and supplier of nationally recognized brand-name building materials with approximately 270 employees and 14 distribution centres covering all major regional markets in Canada.

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News Watch

Colour Choices Look Rosy For 2010, Sico Predicts cor in 2010; a move away from more drab, traditional colours. Stéphanie Pelland, marketing communication manager for Sico brand paints and member of the international colour forecaster Color Marketing Group, suggests the colour changes are about socioeconomic shifts. “During the past years, Canadians have

Workers In B.C. Green Dream Home Receive Safety Training The Construction Safety Network (CSN) has been brought on to offer training and resources to workers on B.C.’s EQuilibrium Green Dream Demonstration Home. The project, which has now broken ground, is one of 15 demonstration homes being built across Canada as part of the EQuilibrium Sustainable Housing Demonstration Initiative launched in 2005 by Canada Mortgage and Housing Corp. (CMHC). The goal of the program is to build healthier, more energy efficient, environmentally-friendly and resource-efficient homes and communities by bringing together the private and public sectors. The demonstration home will be designed to a net-zero energy house that produces as much energy as it consumes. Once completed, the EQuilibrium demonstration homes will be made open for public and professional tours for a minimum of six-months, during which time Canadians can learn first-hand about available sustainable housing choices and industry professionals can see how to deliver better environmental products and services to their clients. Twelve teams were chosen to lead projects in 2006 in the Prairies, Ontario and Quebec. Another three have now been chosen in B.C. and Atlantic Canada. A total of 72 builder and developerled teams submitted proposals to a committee of independent housing experts

JANUARY/FEBRUARY 2010

as part of the program. The Dream Home in Kamloops, B.C. is a partnership of the Canadian Home Builders’ Association Central Interior, Thompson River University, CMHC, Sun Rivers Golf Resort and the Southern Interior Development Initiative Trust. Constructed in the English Country architectural style common in its surrounding Ironwood neighbourhood, the 3,000 square foot two-story house will feature a two-story entrance, spacious rooms and a fully furnished basement, suitable for renting out for additional income. For energy efficiency, the Dream Home will take advantage of triple glazed low-e windows, insulated concrete forms, geothermal heating system, motion light sensors, heat recovery ventilation, solar panels and high-efficient Energy Star appliances to help achieve the house’s net-zero rating. It is being built by Nexbuild Construction in the Sun Rivers Golf Resort Community. Nexbuild Construction has been certified by CSN, and will receive $60,000 from CMHC to help offset costs relating to the documentation of their projects, carrying out quality assurance and demonstrating the homes to the general public. Tours will begin on May 15, 2010 and will run on Fridays, Saturdays and Sundays until the end of October.

CONTRACTOR ADVANTAGE

opted for comforting, warm neutrals like browns and beiges as a result of an uncertain economic, political and environmental climate, but now people have had enough with doom and gloom and are looking for a change, a new beginning,” Pelland says. “In 2010-2011, we will see a trend toward consumers choosing brilliant colours to reflect their optimism in their quest for a brighter future.” Sico says that as the year unfolds, certain “energetic” colours (especially grey from silver to deep slate) will be used to complement existing neutral tones. To meet the demands for brighter co-

Photos: sico

Canadians will be seeking brighter hues in their household paint selections this year to lift spirits and signify a fresh start, according to Sico Inc. Research conducted by the paint company says Canadian homeowners will be seeking deep reds and purples, vivid blues and greens, pastels like baby blue and pink and earthy golds for their home dé-

Photos: sico

News Watch

lours Sico is launching four new colour groupings for 2010. Back to Basics, is a rural-inspired theme features down-to-earth mid-tones in gold, plum, green moss, teal and red clay. The

company says the colour theme is aimed at a growing group of the population seeking simpler past times. Free Expression is designed largely for young social media users and features

unique colour mixes, including intense purple combined with acidic yellow and ocean blue. Classic Revival is highlighted by ash-like purple, antique pink and gold, but made more contemporary by the addition of deeper colours like pewter grey, bronze green and lacquer reds. Sico says the theme represents those who want a reassuring and comforting soft elegance. Synthetic Culture features more dynamic colours like purples, and pulsating pinks, yellows and blues. Sico says this colour theme celebrates the merge of science with art and experiments with the unnatural.

Industry Minister, Holmes Kick off Trades and Tech Week Skills Canada works with employers, educators, labour groups and Diane Finley, Minister of Human Resources and Skills Development, and television contractor Mike Holmes joined with Skills governments to develop events and competitions for young Canadians Canada, a national not-for-profit organization that promotes ca- to engage in experiential learning and trade and technology competireers in skilled trades, to launch Skilled Trades and Technology tions. It is the Canadian member of WorldSkills International. Canada recently hosted WorldSkills Calgary 2009, the largest Week at Toronto’s Humber College. The launch was made official with a “Cutting of the Plank” cere- demonstration of trade and technology talent in the world. The mony, drawing attention to its construction industry-oriented theme. event held from September 1 to 7 was Canada’s 10th participaThe week was aimed at generating awareness of the growing tion in WorldSkills, and its second time hosting it. It featured skilled labour shortage in Canada. The Conference Board of Can- 45 competition areas for 900 participants from 51 countries or ada forecasts a shortage of more than one million skilled workers world regions. by 2020, with an estimated 40% of all new jobs in the skilled trades and technology industries. Skills Canada points out that skilled trades are a crucial part of the Canadian economy that it strives to strengthen through events like the one held in November. “Industries that depend on skilled trade workers are key drivers of our economy and contribute over 50% of Canada’s GDP,” said Shaun Thorson, executive director at Skills Canada. “At the regional, provincial and national level, Skilled Trades and Technology Week help showcase and raise awareness for the broad range of opportunities to be found in the trades, while inspiring and encouraging youth to reach their unlimited options pursuing career paths in skilled trades and technology.” Also announced was the 16th Canadian Skills Competition, which will take place in Waterloo, Ont. from May 20-23, 2010 and will be the final challenge for many young trade and technology students hop- Pictured at the event are television personality and contractor Mike Holmes ing to secure a Team Canada spot at the WorldSkills (left), Minister of Human Resources and Skills Development Diane Finley and Jonathan Arbour, gold medalist in cabinetmaking at WorldSkills Calgary 2009. Competition in London, Eng. in 2011.

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News Watch

Housing Starts Continue To Increase In 2010, CMHC Says Housing starts are expected to grow in 2010 to 164,900, according to the CMHC fourth quarter Housing Market Outlook. It is a sign of better times, suggested Bob Dugan, chief economist for CMHC. “We expect housing markets across Canada to strengthen leading into and over the course of 2010 as economic conditions improve,” he said. According to Dugan, demand for existing homes rebounded in late 2009, and lower inventory levels in both the new and existing home markets will lead to stronger housing demands prompting higher levels of housing starts this year. The end of 2009 highlighted the recovery, according to CMHC. The seasonally adjusted annual rate of housing starts reached 157,300 units in October, up from 149,300 started in September. Dugan said the housing starts in October represented the highest level of single home starts since October 2008. Across Canada, October’s seasonally adjusted annual rate of urban starts increased by 15% in B.C., 14.8% in Ontario, 6.5%

in the Prairies and 1.2% in the Atlantic; however, it declined in Quebec by 11.6%. As a whole, the seasonally adjusted annual rate of urban starts increased by 5.2% to 139,900 units in October. Urban multiple starts jumped in the month by 13.8% to 72,600 units, while urban single starts saw a dip of 2.7% to 67,300 units. Rural starts in October were estimated at a seasonally adjusted annual rate of 17,400 units. In existing housing sales, the organization noted that strong multiple listing sales (MLS) in the second and third quarters of 2009 were a result of delayed activity from the previous two quarters and it does not expect such a rate to be sustainable. As a result existing home sales (as measured by the MLS) was predicted to reach 441,300 units in 2009 and grow to 445,150 units in 2010, with an average price of $312,950 in 2009 and $324,500 in 2010.

NTTC Lobbies For Lien Act Change The National Trade Contractors Coalition of Canada (NTCCC) has called on the Ontario government to help ensure the success of small businesses by creating a legislative framework for prompt payment. As a first step, they suggest making amendments to the Construction Lien Act. During the normal course of business, a trade contractor carries substantial upfront costs to complete a particular job, the organization said in a statement. This includes equipment, materials, and employee salaries. “Even at the best of times, businesses rely on being promptly paid for services delivered,” said John Blair, Executive Director of the Canadian Masonry Contractors Association. “By ensuring prompt payment, Ontario will be at the vanguard of a national effort to provide financial stability for trade contractors” said Blair. “(That) will protect jobs, reduce the costs associated with construction, and help thousands of small businesses remain successful.”

JANUARY/FEBRUARY 2010

CONTRACTOR ADVANTAGE

www.weiserlock.com

New Products

Building Blocks

Innovative Products for Today’s Renovators Price Pfister expands kitchen faucet portfolio The new Mystique, Florentino and Cadenza lines of kitchen faucets from Price Pfister Inc. are designed to match the varying design tastes of homeowners and make fixtures a centre piece of the kitchen. The Mystique Pull-Down Kitchen Faucet has a modern, minimalist design, and a three-function spray head. A pause feature allows water flow to be stopped directly from the spray head for convenience and to reduce water waste. The Florentino Kitchen Faucet has a unique two-handle fixture and a high-arc spout that is taller than the industry standard, allowing for greater clearance underneath the faucet. A four-hole configuration, the Florentino includes a matching side spray and is available in stainless steel and Tuscan bronze finishes. To cater to customers with a more selective style, the Cadenza Kitchen Faucet features an intricately designed fixture with a high-arc spout. Also available in stainless steel and Tuscan bronze, it includes a matching soap dispenser and side spray. Price Pfister’s fixtures come with ceramic disc valves and are covered by the company’s Pforever Warranty, which guarantees finish and function for the life of the product.

Mystique

Cadenza

Bosch, cordless shear cuts 18-gauge metal Bosch Power Tools & Accessories recently launched the Bosch PS70 Metal Shear designed to provide convenient metal cutting in awkward cutting locations such as the steep pitch of a roof or cramped quarters between flooring members. Weighing 3 lbs. and 10” in length, the PS70 is built on Bosch’s 12V Max Litheon battery platform for fast charge time and strong battery life. Bosch says it can cut through 18-gauge thick metal and sports an adjustable four-sided cutting blade that make it capable of cutting accurate holes as small as ½” in diameter. An easy-to-adjust cutter clearance lets the shear perform both straight and curved cuts with equal precision. The grip includes ergonomic features such as an over-moulded soft grip in the segment and top-mounted switch for ambidextrous control and to reduce fatigue. For improved job site safety the shear includes a battery fuel gauge and built-in chip deflector.

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In business it’s good to have a few options. The Ford Commercial Connection Program is all about providing your business

prec can to m T ince ery rang back T • N r a • N R • N T • N p T thre

with more for its vehicles. Each option is designed with your business in mind, providing more value and a work ready vehicle.

Option A: No-Extra-Charge E-Series Racks Get more storage with Ford exclusive E-Series Cargo Van Quietﬂex III or Steel ‘Racks and Bins’, or more cargo protection with EconoCargo Van Lining Package.

Option B: Customer Cash Back Get more back on Ranger, Transit Connect, E-Series Vans and Cutaways, F-150 and F-Super Duty. Receive up to $1,500 rebate when you spend a minimum of $1500 worth of commercial body, commercial equipment, or commercial accessories.

Option C: Parts & Service Value Coupon Get more peace of mind on Ranger, Transit Connect, E-Series, F-150 and F-Super Duty. Receive a $1,000 parts and service value coupon when you spend a minimum of $1,500 worth of commercial body, commercial equipment, or commercial accessories. And now commercial use Explorer, Sport-Trac, Edge, Escape, Flex and Expedition are eligible to receive a $500 parts and service value coupon.

fordcommercialvehicles.ca • 1-800-668-5515

Vehicles shown with optional equipment. Option A available only on the purchase or lease of new and unused 2009 or 2010 Model Year E-Series Van with commercial body, commercial equipment or commercial accessories valued at $1,500 or more. Offer limitations do apply. For complete details on the above options, applicable limitations, and on the program please visit fordcommercialvehicles.ca or visit your Ford Dealer.

O ries This with ‘Ra Eco to p S ages tory duri P tion • Q p s 4 r w a a

h e

Practical Incentives

ord knows that its commercial customers want trucks, cargo vans, and upfits that are powerful, durable, and reliable. However, they also appreciate practical incentives – the kind that can help upfit and outfit their new workhorse to meet their unique needs. The Ford Truck Commercial Connection incentives are designed to meet virtually every commercial customer’s truck needs. This ranges from whether they simply want cash back or a cargo van interior system. Trucks that qualify for the program are: • New/unused 2009/2010 Model Year E-Series Van & Cutaway, 2010 Transit Connect and FSeries Pickup & Chassis Cab • New/unused 2009/2010 Model Year Ranger • New/unused 2009/2010 Explorer, SportTrac, Edge, Escape, Flex, and Expedition • New/unused 2009/2010 F-650/F-750 product The Commercial Connection program has three options for contractors. OPTION ‘A’ Option ‘A’ is the No-Extra-Charge E-Series Racks and Bins – a $2,495 value (MSRP). This gives the contractor real storage value with E-Series Cargo Van QuietFlexTM or Steel ‘Racks and Bins’ or cargo protection using an EconoCargoTM Van Lining Package molded to perfectly fit an E-Series Van. Supplied by Masterack® Crown, the packages can be ordered by the dealer at time of factory order and the components will be installed during the assembly process at the factory. Packages are available in three configurations with specific content in each package: • QuietFlexTM III Racks & Bins – a composite shelving system, it permits full seat travel for the driver and an additional 4” of seat recline. The composite material along with the automotive seal on the walk-through partition door reduces noise and vibration that is evident on all steel alternatives.

It also features Ford blue shelving that is more flexible with an enhanced design permitting shelving to be removed or reconfigured. Shelves are pre-punched for a set of composite dividers that can be configured to meet the contractor’s requirements. • Steel Racks & Bins – this is a commercial grade industry shelving system with a steel bulkhead with a door to protect the driver from shifting cargo. There is a passenger side parts drawer and bin module with a driver’s side dual utility shelving unit, dividers, and a single 46” high storage cabinet on the driver’s side. • EconoCargoTM System – this is a moldedto-fit composite wall panel protective lining system. Thermal insulation improves climate control and reduces road noise and cargo tie down rails.

• Slide out cargo beds / cargo systems • Commercial pickup caps such as Lear Construction caps and the ARE line of DCU commercial caps For commercial customers with requirements for a speciﬁc commercial body that will be mounted to a E-Series Cutaway, F-350/F450/F-550 Chassis Cab, F-650/F-750 Chassis Cab, there is a $1,500 Customer ‘Cash Back.’ This Customer cash back provides great assistance to customers as it can be used to lower the acquisition cost of their new commercial vehicle. Eligible upﬁts here include: • Dump bodies • Van bodies • Flat decks • Towing and recovery bodies • Cube van • Service and utility bodies • E-Series utility type bodies

OPTION ‘B’ Option ‘B’ assists customers through Customer ‘Cash Back’ Incentives of up to $1,000 on commercially equipped Rangers, E-Series Vans, Transit Connects and F-Series and FSuper Duty Pickups. The incentive reaches $1,500 on E-Series Cutaway, F-Super Duty Chassis Cab, F-650s, and F-750s. The program partners install the accessory equipment or bodies that are required. Approved commercial equipment includes: • Racks, bins, and interior shelving packages (Van) • Van lining packages • Ladder racks • Dealer installed commercial pickup accessories • Tool boxes and bed lining packages • Commercial Utility Pickup racks • Snow plows and salt spreaders • Rear lift gates • TracRac ladder rack system • Safety partitions / bulkheads • Spray tanks and spreaders • Winches

OPTION ‘C’ Option ‘C’ is designed for the small contractor who wants to control the potential cost of operating their business and realizes their vehicle is a signiﬁcant part of that equation where downtime means lost revenue. With the selection of Option ‘C,’ the customer can establish a service line of credit for future vehicle maintenance/service or can choose to use the funds towards purchasing a Ford ESP protection plan, a Ford Maintenance Protection Plan (FMPP), or towards a credit on the Quality Fleet Care line. The value of the commercial equipment or commercial body (if required) must be $1,500 or more at cost. The payment values are $1,000 for Rangers, E-Series Vans, Transit Connects and F-Series Pickups, and $1,000 for E-Series Cutaway, F-350/F-450/F550 Chassis Cabs, and F-650/F-750 Chassis Cabs. A ‘Soft commercial’ offering provides a $500 customer parts & service value coupon if the customer purchases an Explorer, SportTrac, Edge, Escape, Flex, or Expedition for use in the operation of their business. ■

New Products Owl GreenEboard now CCMC approved GreenEboard wall board, distributed by OWL Distribution Inc., has recently been approved by the Canadian Construction Materials Centre (CCMC) for use in commercial and residential construction as a wall tile backer board in tubs, showers and other areas requiring a water resistant substrate. It has also been approved as an underlayment for hard surface tile floors, parquet floors and soft floor coverings such as carpet, vinyl or cork tile. An environmentally-friendly alternative to traditional tile backer, wall board and underlayment, GreenEboard can contribute to four LEED categories, according to OWL. It is lightweight, impact resistant and has a 20-year transferable warranty. OWL says GreenEboard is easier to use than cement backer boards and has natural benefits over gypsum based ones. The board is manufactured with a patent pending proprietary process using natural mineral products, including magnesium oxide and magnesium chloride.

New All weather windows glass designed for northern climates All Weather Windows has released a new energy-efficient glass that meets Energy Star requirements for all zones in Canada. As it meets such broad regional requirements the Comfort E-PS Energy-Efficient Low-E Glass, it can help lower heating costs in colder Northern climates where they are at a premium. According to independent testing results, All Weather Windows says a typical homeowner in Canada can save an average of $130 per year using Comfort E-PS glass, as compared with standard lowsolar heat gain co-efficient (SHGC) windows. The SHGC rating of 0.73 allows high levels of solar heat from the sun to enter the home, while still insulating to keep cold air outside. The inside surface of the window also remains warmer, minimizing the drafty feeling caused by cold glass surfaces. Comfort E-PS is recommended for use in homes, condos and apartments, but it can also be used in some commercial applications.

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Arrow® has the Power House of Professional Hammer Tackers. These rugged tools with their sleek design allows for hours of comfortable use. With heavy duty all-steel construction and precision lock rear loading these hammer tackers can hold two full strips of T50® staples in 3 sizes. Our latest model, the HTX50™ features: • A knuckle guard to help protect hand from injury • Slip guard to keep tacker firmly in hand • Surface guard flange to reduce damage to work surface But, don’t take our word for it. Try them the next time you need to tackle one of the following projects: • Roofing Underlayment • Housewrap • Insulation • Vapor Barrier • Carpet Padding Installation

Visit us at www.arrowfastener.com for more information on this and other great Arrow tools.

Arrow Fastener Company, Inc. USA Tel: 201.843.6900 Canada Tel: 514.321.3983 UK Tel: 44.208.686.9180

Learning Curve

Call It Marketing 2010

Two new releases discuss topics ranging from the importance of social networking to how to better “sell” yourself.

book Marketing in the New Media (2nd edition) Self-Counsel Press

Marketing today for small business owners in the construction field requires a combination of using traditional routes such as print advertising, and also internet and mobile marketing techniques to succeed in effectively delivering a message anytime and anywhere. The second edition of Marketing in the New Media presents techniques for small business owners, or marketing professionals (should they have them) that will allow them to take the plunge into the world of internet and mobile advertising in order to help “close the sale” and have clients look to them for their business and expertise. The guide offers advice on building a successful business Web site and buying ads on new media and social networking sites, as

well as insights into internet demographics and digital lifestyle to help business owners better understand how to reach out to potential clients. It outlines how to analyze Web traffic reports and online customer behavior, as well as how to make informed decisions on the performance of online marketing campaign. Chapters focus on the effective combination of new media techniques and traditional advertising, as well as how to encourage interactivity an audience of potential clients. This edition delves deeper into social networking, such as Facebook, with advice on using the sites to help build and grow reputation through groups and fan pages for business. Holly Berkley is an internet marketing consultant and the author of Low-Budget Online Marketing for Small Business. She has helped businesses of all sizes increase online sales, strengthen their brands and boost Web site traffic.

book Marketing & Selling Professional Services in Architecture & Construction John Wiley & Sons

Clients are becoming more sophisticated and competition more fierce, requiring a more professional and controlled approach from contractors to sell themselves. Larger contracts, such as PFI bids, require the advance commitment of vast resources to winning the business. John Wiley & Sons has released Marketing & Selling Professional Services in Architecture & Construction as a guide for construction professionals as they navigate marketing solutions in today’s challenging environments. It is a practical selling and marketing guide for contractors, as well as architects, engineers, project managers, facility managers, surveyors seeking to better “sell” themselves to clients and prospects. The book provides simple-to-follow processes, illustrated

through diagrams and checklists and sets out seven key aspects of the selling and marketing of professional services. It covers all the bases of marketing including selecting target clients; identifying their needs; shaping services around those needs; presenting capabilities and availability; delivering added value for repeat business; and credibility building. The book contains a variety of applicable ideas and examples and is structured to allow readers to quickly jump into sections most relevant to their current activities and needs. Chapter topics in the extensive guide include strategy development, creating a pipeline, presentation and sales techniques, methods of a strong first meeting and building trust. A number of tips for pitching construction projects are also provided as well as some sound advice that centres on client negotiations. Both books are available at www.chapters.indigo.ca. CONTRACTOR ADVANTAGE

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Paint Performance Zero-VOC paint is better for the environment and for your nosebuds. Pittsburgh® Paints has come up with a zero-VOC paint that is so close to odourless you can paint today and occupy your room by night. Pure Performance® offers the perfect mix of premium paint performance and the latest environmental attributes. It’s easy to apply, durable, and high-hiding, with excellent adhesion and touchup. It’s also zero-VOC, mildew-resistant, and extremely low-odour during painting and drying. The first national paint brand to receive the Green Seal® Class A certification, Pure Performance is also certified by EcoLogoM and the Master Painters® Institute. Pure Performance is available in three beautiful finishes, a primer and 1,890 vibrant colours from the Voice of Colour® Design System, which features Eco-Echo, a new collection of organic, eco-friendly colour palettes. To find the best colour for your painting project, log onto www.voiceofcolor.com and play the Color Sense GameTM.

Eco-Echo “Fair Trade” palette

See Pure Performance and Eco-Echo at your local Castle Building Centre.

Business Strategies

Business Growth Through Computing A carpentry contractor has evolved into a powerhouse thanks to a smart and homegrown information management system. By Patricia W. Atallah

I recently met with John Rapaport of Component Assembly Systems (CAS) and he told me the remarkable story of his company’s evolution over the past 15 years from a small carpentry contractor to a commercial drywall construction, millwork, and carpentry company with more than 1,200 employees and operations in both Canada and the U.S. The catalyst is a homegrown information management system that might be the next big thing in the construction information technology (IT) market. Rapaport joined the family business back in the early ’90s with a law degree and experience as an attorney. As an outsider looking in, he observed that the only people who had access to computers were those in the accounting department. The office and field staffs were entrenched in a paper-intensive reporting system that was not always accurate or timely. CAS was not unlike any other contractor back then, when construction IT was all but non-existent and the primary focus was on bidding and performing the work. Paraphrasing Rapaport, the industry was so busy washing the dishes that no one had time to set up the dishwasher. Back in the early 1990s, he understood that it is difficult to successfully plan and execute work without the benefit of good data to support decision making. He had the vision to look at every process that occurred on paper and model an in-house information system that would organize

data and track project progress and performance to “allow us to identify situations where we could be in a ditch and find solutions to avert them.” He saw clearly the need for a proprietary system that would help the CAS team identify problems on a project early on and take appropriate action to ensure that project goals were met. To accomplish this, CAS made some bold moves in 1993 and purchased job cost accounting software from CF Data Systems that would serve as a foundation for a more elaborate system that was later named CASim (CAS information manager). Rapaport also hired a team of systems engineers and analysts and put them to work. They initially collected detailed information about labour productivity (signifying as much as 70% of project costs) and gathered, analyzed and organized data at every stage of the project; from estimates and bids, to budgets, actual costs, change orders, trade payment breakdowns and completion. For the first time, CAS team members had accurate and complete information at their fingertips. By 2002, CASim had evolved into a Web-based system of 100 drilldown screens that can store a complete library of project data. It assists the project team to track progress at regular intervals and to make timely management decisions both within and across projects, a critical capability for a trade contractor that has 50 to 70 proj-

Tricia Atallah is Principal of VantagePoint Strategy Group, a strategic and management advisory firm serving the construction industry. She is also author of Building a Successful Construction Company. Further information on the book is available at www.constructbiz.com.

ects going on at any given time. CASim is apparently intuitive and user friendly and is easily accessible to project team members to view specific relevant information. CAS is now making plans to roll it out to the market as a new construction IT product. According to Rapaport, the biggest challenge of this initiative was internal resistance. Initially, CAS employees were skeptical and fearful that they could lose their jobs as a result of automation. He had to prove his case for information technology during the course of a series of meetings in which he laid out the logic and strategy. He also instituted regular strategy, kick-off, status and close-out meetings which involved everyone on the project. This included staff from the field supervisors and foremen to the project managers and estimators, and purchasing, accounting and executive staff. Rapaport provided laptops and training and sought ideas and feedback from the team regarding software development. In addition, CAS introduced a system of performance bonus incentives. Over the years, these initiatives have led to many changes at CAS. The organization structure has been flattened, with active input and participation from all levels. Cooperation, teamwork and sharing of information and resources are evident between the office and field. I met a few CAS staff members who have participated in this transformation and I could feel the excitement and vitality in the air. They seem to know where they fit into the organization and have a stake in its success, and are willing to work together for the benefit of the company. The proof is in the results.

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Smart Money

International Financial Reporting Standards While private companies have no mandatory conversion date to work towards, the question of whether to adopt IFRS is a substantial one. By Paul Rhodes

Publicly accountable entities in Canada are required to convert to International Financial Reporting Standards (IFRS) as the new basis of financial reporting with effect from the first fiscal year commencing on or after January 1, 2011. Meanwhile, the accounting rules for private entities are also in a state of flux; the Canadian Accounting Standards Board approved the final accounting standards for private enterprises in Canada (Private-GAAP), which sets out simplified accounting rules for non-publicly accountable entities that chose not to voluntarily adopt IFRS. The shareholders and management of a private construction company therefore have a choice as to which generally accepted accounting principles (GAAP) to adopt. It will be clear for many that Private-GAAP is the more appropriate, but for others the decision will have to take into account many varied factors and will be more complex. Let us very briefly look at IFRS: what it is, how it works and some of the more common factors that must be considered in making this decision. What IFRS is: The term IFRS refers to a body of accounting standards that includes International Financial Reporting Standards issued by the International Accounting Standards Board (IASB). Also included are International Accounting Standards, issued by the IASB’s predecessor, and Interpretations issued by the International Financial Reporting Interpretations Committee (IFRIC).

How IFRS works: IFRS is generally described as a principles-based set of rules, whereby each standard describes the general principle or principles and also provides additional description and examples in order to assist in application. While the narrative in many standards also includes required accounting treatments in specified circumstances, the preparer is often required to exercise significant judgment. Why adopt IFRS? The shareholders and management of a private construction company will have to consider the company’s future business plans and objectives in order to make the most appropriate decision. The specific factors to consider will likely include the following: 1. If the company competes with, and is compared against public entities in the industry, then adoption of IFRS would group the company with its peers. This would allow management to directly compare the performance and financial position of the company with the competition. 2. Since IFRS is the world-wide recognized and understood GAAP, adopting it would enable both a broader international comparison and also make the financial reporting of the company understandable by international users. Voluntary adoption of IFRS would therefore assist the company in entering the global stage, for example: • making the financial reporting of the company consistent with its pro-

Paul Rhodes is a partner of Soberman LLP and a member of the firm’s IFRS Advisory Group. His professional experience includes construction, manufacturing and real estate and internal audit engagements. Paul is a member of the Toronto Construction Association

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spective overseas business partners; and • if financing is to be sourced from international markets those financiers would be able to understand the company’s financial reporting. 3. Accountants are still unsure as to how IFRS will be received by the banks and other mainstream financiers in Canada. Disclosures required by IFRS would be more extensive and detailed and therefore may be more informative of the performance and financial position of the reporting entity than might be the case under Private-GAAP. As a result, it has been suggested that banks might require IFRS for larger private entities and groups but find either IFRS or Private-GAAP acceptable for others. Still, the lending policies and practices to be adopted by the banks remain to be seen. 4. If the business plan anticipates a goingpublic transaction, such as an initial public offering (IPO), any prospectus to be filed as part of the process will require the inclusion of several years of financial information prepared under IFRS. To have to recreate such information after the fact would involve considerable expense and management time. Voluntary adoption of IFRS would involve some cost but the future return earned on that investment could be substantial. 5. Alternatively the future business plan may be a sale to a public entity. If this is the case then voluntary adoption of IFRS would make due diligence and valuation by the acquirer easier and less costly; whether this would translate into some economic benefit to the vendor would depend on the structure of the transaction.

Smart Money

In order to stay ahead of the competition, many business owners are forced to constantly improve their products.

6. The financial statements prepared under IFRS would have a very different look and feel than under Private-GAAP due to the level of detail required to be disclosed. Furthermore, depending on the specific circumstances of the company, there may be several material differences that would affect both equity and earnings on conversion. While private companies have no mandatory conversion date to work towards,

the question of whether to adopt IFRS is a substantial one. Shareholders and management need to ensure that the best course is chosen to enable them and the company to meet their goals and objectives. On a different note, it is predicted that many of the generally accepted accounting principles of the worldâ&#x20AC;&#x2122;s private entities will be gradually replaced by the simplified and abbreviated version of IFRS developed by the IASB (called SME-IFRS for small- and medium-sized entities). SME-IFRS is a self-contained accounting standard of less than 230 pages designed to meet the needs of SMEs. In the U.K., a recommendation has

already been made for the adoption of SME-IFRS. Convergence of private entity financial reporting with SME-IFRS makes considerable practical sense and will make increasingly more sense as time progresses, given the trend for convergence of all accounting standards with IFRS. That conversion is being aided by the collaboration efforts between the IASB and the individual standard setting bodies around the world, including the Canadian Institute of Chartered Accountants. Whether, or at what point, this change is made in Canada remains sheer speculation on my part.

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Economics 101

Buckets Versus Pipelines

The bucket brigade method takes too much time and puts any business at risk. Pipelines, on the other hand, improve profit. By Jay Arthur

Is your business a “bucket brigade” or a “pipeline to profits?” A bucket brigade is a business that spends too much time in fighting fires and crisis management. A bucket brigade usually has a backlog of work and customers complaining how long it takes to get what they need. Does this sound like your organization? Unfortunately, most businesses look more like a bucket brigade throwing water on a fire than a pipeline to profits. If you are still not sure where your business falls, here are a few more elements that describe a typical bucket brigade: • First, employees or computers fill buckets (e.g., inbox, e-mail, workstation, vehicle, etc.) with work. It does not matter if the bucket is a carpet cleaning truck, a salesperson’s order file or a hospital waiting room; it is a bucket. • Then they proceed to work each piece in the bucket, filling an outgoing bucket with partially finished work to be sent on to the next workstation. The first piece in the bucket has to wait on the last piece in the bucket before moving on. • They also fill another bucket with pieces that have to be reworked in an earlier step. Someone on the bucket brigade periodically picks up these buckets and carries them back to an earlier workstation to be processed. This rework inhibits the workflow. • As some workstations are faster than others, buckets pile up at some work-

stations waiting on the next step in their journey. This causes more delay. If a printer, for example, can print one million magazines in a day, but only bind 200,000, the other 800,000 have to be stored for four days and moved more than once, increasing the chances for damage. • At the start-stop motion of the bucket brigade, inventory has to be maintained everywhere along the line: raw materials, partially finished work, rework, finished goods and scrap. This bucket brigade method of running a business takes too much time and puts any business at risk. It makes it difficult to change the schedule of production. How did it get this way? It dates back to lessons learned as children. The Myth of Economies of Scale: If you were growing up in the 1950's, you learned about Henry Ford’s mass production line and economies of scale. Economies of scale suggest that if a factory can produce 10,000 identical black ModelT's, it would be cheaper than producing 10,000 custom cars. While this was true in the 1920's, in the 1950's Toyota was perfecting a way to produce 10,000 custom cars cheaper than 10,000 massproduced cars. In this century the new economies are economies of speed. The fast eat the slow. To avoid being eaten, a company must slash its turnaround times by 7590%. How does a company get faster?

Jay Arthur has spent the last 20 years helping companies maximize revenue through the “Lean Six Sigma System,” a collection of audio, video, books and software. He can be reached at 1-888 468-1537.

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By turning their bucket brigade into a pipeline to profits: • Stop trying to make employees faster. In a bucket brigade, employees only work on the product for three minutes out of every hour. • Start making the product or service faster. Where does it sit idle waiting on the next step in its journey? How can the workflow be rearranged to allow each piece to flow through without waiting on the rest of the bucket? • Reduce inventory of all types. Inventory is fundamentally evil; it sucks up time, space and money that could be used more productively. • Downsize machinery. Mass production often requires big, high volume machines. Pipeline production often requires a handful of smaller machines instead of one big machine. • Shrink the space. Often, people and machines expand to fill the available office or factory space. This increases unnecessary movement of people and materials. Walking is waste. Redesign the space to minimize unnecessary movement. • Stop doing stuff and making things customers have not ordered. Most companies operate on the “Field of Dreams” theory: “If you build it, they will come.” Pipeline companies operate on the theory: “When they come, build it so fast it will make their head spin.” When one piece of work can flow through the business without waiting, it is a pipeline. Sometimes, small batches of work are necessary, but aim for one-pieceat-a-time. If you are still not sure about how to turn your business into a pipeline to profits, think of Subway … not the public transportation, but the business model of Subway sandwich shops.

Economics 101

When one piece of work can flow through the business without waiting, it is a pipeline. Sometimes, small batches of work are necessary, but aim for one-piece-at-a-time. Walk into any Subway sandwich shop and you will see a pipeline in action: • Every sandwich is made to order (one piece at a time). • A small oven cooks fresh bread as needed. • A small storage unit holds the baked bread. • A small toaster handles the hot sandwiches. • Small buckets of cheeses, meats and vegetables provide the raw materials. • A small rack across from the cash register allows customers to pick their own bag of chips. This is replenished as needed. • Customers get their own drinks. While most managers' worry that pipelines will not keep workers busy, it is only true for a short period of time. Studies have shown that a pipeline will enable companies to: • Double productivity and profits. When employees do not have to pick up work and put it down and store it and move it around, it is easy to double productivity. • Grow three times faster than their competitors (source: Competing Against Time by Stalk and Hout). When customers figure out that a business is up to 10 times faster than the competition, they flock to it. • Reduce mistakes and errors by 50%. Less fire fighting, billing adjustments, returns, warranty problems, etc. Any one of these three is a good rea-

son to reconfigure a business into a pipeline, but when combined, they are a winning combination. While bucket brigade businesses can still make a tidy profit, pipeline businesses can make a fantastic profit and acquire more market share. Remem-

ber: the fast eat the slow. Have not most businesses waited long enough to start streamlining their workflow into a simple pipeline that will maximize profits and customer satisfaction? Or are they going to wait to be overtaken and eaten? Only time will tell.

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Cover Story

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Cover Story

Smart Home Automation

Explained

By Paul Welch

Call it a win-win situation: consumers reduce their environmental footprint and contractors improve their bottom line.

he modern business world demands changes and the construction industry is really no different. Technological advances arrive almost daily, demanding that contractors stay on top of innovations or lose their share of the marketplace. An expanding world of technology, combined with a growing green consciousness among consumers, puts a double load on industry awareness. Experts note one growing trend that contractors must stay on top of is automation. Smart home, or home automation, is the concept of incorporating cutting-edge technology to let the homeowner run the home ultra-efficiently, with shared emphasis on comfort, energy-saver efficiency and financial savings. This techno/green blend allows the homeowners remote and automated operations of simple functions ranging from watering the lawn to turning on and off interior and exterior lights on timed or sensored command, while conserving energy and energy bills by reducing or eliminating wasteful use of power. It is an evolving technology that is finding greater favour with the consumer, says James Jones, vice president with Castle Building Centres Group Ltd., and it is one that contractors should become comfortable with. â&#x20AC;&#x153;The big thing for contractors is that (being able to offer smart-home construction or renovations) means more value added to their service, and it helps consumers reduce the cost of their electricity and reduce their environmental footprint.â&#x20AC;?

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Cover Story Jones says more consumers are looking to automation for the double-edged benefit of implementing a greater green lifestyle and reducing their home energy costs, and that a growing number of contractors realize that, as well. “Both contractors and consumers are recognizing the value,” he says. The automation philosophy envisions a home that is comfortable and safe for its occupants and visitors, and is also energy-efficient; the combination of technology and services for improved living in the areas of safety, comfort and technical management. Smart home technologies employ systems and devices that can control elements of the home environment from lighting to appliances, telephones, home security and mechanical, entry and safety systems.

motion detector or it can be part of a computerized home automation system. Home automation can link lighting, entertainment, security, telecommunications, heating and air conditioning into one centrally controlled system. Automation essentially lets the homeowner turn the home into an active partner in managing life. The automated home is no longer a passive structure. Instead, it becomes a tool in helping you make the most of your time, enhancing your safety and security, even saving you money on your energy bills. With automation, a central controller (microprocessor) receives signals from controlling devices and forwards the signals to the appliances and systems in the house under control. The central processor serves as a traffic cop by initiating and/or routing communication signals throughout the house. The user can interface with the system via keypads, touch screens, panic buttons, TV screens, computers, telephones, handheld remotes or other devices.

Home automation systems can be operated by electricity or a computer chip, using a range of different types of switches.

The homeowner programs the system based on preferences and needs turning on exterior lighting at a set time, for example, or activating lawn sprinklers for a set period on specified dates and the system follows commands. Home automation systems can be operated by electricity or a computer chip, using a range of different types of switches. A simple device such as a light can be activated by a signal from a

Automation products are typically modular, meaning products can be added or removed from the systemic system with little or no affect on the function of other system components. Smart-home technology provides the homeowner with control over most household systems. They include: • Lighting • Security systems and access control • Home theatre and entertainment • Phone system • HVAC (heating, ventilating and air conditioning) • Lawn-watering Automation serves a variety of important functions. Among them: • Providing precise control over the home environment • Improving in-home communication • Saving the homeowner time and effort on once-manual chores • Improving personal safety • Efficiently regulating heating and cooling, thus reducing waste and expense • Providing audio and visual alert to emergency situations • Allowing home monitoring during the homeowner’s absence Heating and cooling: These are usually the costliest expenses in operating a home. Programmable thermostats that use computer chips allow heating and cooling systems to be set to run

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D R A H S A T S U J S K R WO AS YOU DO Honda Big Red

with torque converter, truly sets the Big Red apart Automotive style 3 speed automatic transmission from the competition and occupant protection structure roll cage, headrests Wide stance, high sill doors, side nets, four pillar ved safety impro offer help belts seat style (ELR) tor Retrac automotive-style, 3 point, Emergency Locking for company and employees ing g system similar to that of an automobile provid Only vehicle in its class to use a “failsafe” brakin ed front and rear braking even if one line gets sever a that is corrosion resistant and large enough to ﬁt Plastic-coated cargo bed with replaceable side panels bed helps unload cargo on e featur tilt ed assist y ulicall Hydra standard 42” by 48” pallet with tailgate down. ately). receiver hitch (draw bar and hitch ball sold separ heavier loads. Easy hauling with 2” automotive style bed Quick clean up with rinse out interior and cargo ﬂoor es rear mesh screen, split windscreen, interior Contractor's accessory package available, includ plug er receiv hitch and bar draw box, y mat, winch / mount kit, bed mat, aux. batter

Trust Honda to help get the job done. Your team is tough, reliable and hardworking, and so is Big Red. Not just any side-by-side, this is the Honda of side-by-sides – complete with a powerful liquid cooled commercial grade engine and comfort-enhancing features like a double wishbone front and rear suspension. And with a continuous towing capacity of 544 kg (1200 lbs) and three selectable drive modes (2WD, 4WD and 4WD Lock), it's just like your guys: a jack of all trades. Visit honda.ca or your local Honda Powerhouse dealer or Honda Authorized Big Red dealer for more information.

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d ).

Cover Story only when they are needed. This reduces energy consumption and costs. The thermostat can be programmed to turn on in the morning before the homeowners awaken, turn down when they leave for work and turn up again just before they come home. Some cooling systems can be programmed to turn off the air conditioning when it detects an open window and turn it back on when all the windows are closed. With a programmable thermostat in different rooms in the house, homeowners can create different zones to be heated or cooled when they are occupied. Some technologies even allow homeowners to call the home computer system, check the temperature and change the thermostat using the telephone keypad. Telephones: The telephone can be used to communicate with someone at the front door and can even be programmed to release the lock and allow a visitor to enter. This is especially helpful to people who have caregivers or attendants coming to their houses. Some telephones can be programmed to ring a unique tone when the doorbell or intercom button is pressed. Appliances: Computer chips are frequently installed in appliances, such as washing machines, coffee makers and water heaters. They can be programmed to operate when the homeowner wants them or at the off-peak energy periods. Doors: Many people use a remote control to open their garage door. An additional feature is a garage door sensor that will alert the homeowner (audibly and visually) if the door is left open. Opening the front door while carrying a load of groceries is difficult for everyone, but can be especially awkward for people with mobility impairments or a person with a service animal. An automatic lock release and door opener can be activated by a remote control device, similar to the device used to open garage doors. Windows: Windows can be closed remotely by a home automation system, and can even be programmed to open automatically when the thermostat registers a certain temperature. If a homeâ&#x20AC;&#x2122;s security system is equipped with window sensors and a window is opened when it should not be or if a window breaks, the sensor will cause the security system to automatically send you a signal or a pre-recorded message. Blinds/curtains: For some people, opening and closing the curtains and blinds is more than an inconvenience, it is physically impossible for them. Many new models of curtains and blinds come pre-automated; however, it may be just as easy to

modify existing installations to be able to control them using a remote control or on a timer. Water: Automated faucets are commonplace in public spaces such as washrooms. This technology is now making its way into homes. Getting the temperature just right for the morning shower can now be as simple as pressing a button. Electronic shower controls allow everyone in the family to personalize the water temperature and water flow. This not only saves energy, it reduces the danger of burns, which can be a concern for families with young children

With a programmable thermostat in different rooms in the house, homeowners can create different zones to be heated or cooled when they are occupied. and people who cannot feel water temperature because of paralysis or lack of sensation. Some models provide audible feedback of the selection, a feature useful to people with a visual impairment. For people who transfer on to a shower bench from a wheelchair or require assistance entering the shower, models are available that will pause the water flow to allow the user to enter the shower area without getting sprayed. Large hot water tanks that continuously heat and reheat water until it is needed are no longer necessary, as high-efficiency heaters produce hot water on demand, allowing a continuous flow of hot water, as much as you need, for as long as you need it.

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Cover Story Fire/Safety: No one wants to take chances with the safety and lives of loved ones, so it is important to be able to both detect an emergency situation and to get assistance when it is needed. Since seniors and more people with disabilities are living alone more than ever before, it is important to consider how to get emergency assistance when it is needed. Smart homes can be equipped with alarms that are wired to work with several devices throughout the home. Alarms can activate telephones that automatically call if there is a smoke alarm or fire alarm. When the fire or smoke detectors are activated, lights in the home will turn on to help people find their way out of the house and ceiling fans will be turned off to slow the spread of a fire. At the same time, the security system will be deactivated, so emergency personnel can easily get into the house. Personal monitoring systems are used by many people as they get older, especially if they live alone. Pressing a button on a wireless pendant or bracelet summons help. Monitoring companies provide the equipment and monitoring service for a monthly fee. The homeowner can select a neighbour or family member to be contacted for assistance. These services are available from most telephone companies across Canada. A monitoring system can help find someone who is prone to wander away from home, or young children. A magnetic door sensor can detect if a door has been opened. Another option is a wireless pendant or wrist band that sends a continuous signal to a receiver within the home. When the person attempts to leave the area, the receiver will detect the missing signal and will sound an alarm or dial the telephone and call a pre-programmed number. There are a variety of brands and types of home automation available. Some work together and others operate only with other devices from the same company or brand. When choosing a system and devices, it is important to consider compatibility and future plans for expansion. Of course, heightened use of technology means greater initial expense on construction of a new home or during renovation. Experts note that, despite the initial increase in financial outlay, the systems ultimately pay for themselves through vastly-improved energy efficiency, which leads to regular, long-term reduction in energy bills. Jim Harris, a management consultant and author with ex-

pertise in the financial value of green innovations, cites recent studies that show a high percentage of consumers are willing to invest in the short term on products and systems that will save them money in the long term, particularly at a time when oil prices and related energy costs are expected to rise significantly in the next few years. For that reason, he says, it is vital for contractors to ensure they are well-versed enough in the theory of home automation to make it part of their service package. “Many people have indicated they will invest in green products, and many others say they would spend on things that will save them money,” he says. “Either way, contractors are putting themselves at a severe competitive disadvantage if they are not in a position to appeal to those markets.”

Home automation can link lighting, entertainment, security, telecommunications, heating and air conditioning into one centrally controlled system.

Helping that cause are the variety of financial incentive programs offered at the federal, provincial and municipal levels that reward homeowners for energy-efficiency innovations to their homes. Experts note this is a valuable marketing tool for contractors offering smart home packages, since it eases the initial financial burden on the consumer. Details on such programs are available from government web sites. Jones notes local Castle stores traditionally steer contractors to appropriate information sources when new products or services become available. As well, he notes, Castle suppliers also have information packages available online or through local Castle stores.

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Feature

Brushing up on interior paint basics Keeping abreast of the latest trends while remaining true to painting basics will help contractors protect the profit and reputation By nestor e. arellano

aint manufacturers increasingly roll out new types of paint each year to suit almost nearly every customer’s needs and whim. It is virtually impossible for a painting contractor to be familiar with the array of products in the market, but industry experts say professionals that want to stay abreast of trends need only concentrate on the basic paint types and their respective uses and strengths to be able to help their clients make the right decision. “Most contractors know that different manufacturers will come up with very imaginative names to describe their products. Whatever they may be called, interior paints typically come down to two basic types, latex and alkyd,” says Andrew Fedele, technical services manager for Para Paints.

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photo: photos.com

Feature

Beyond those two, manufacturers make variations in the formulation to meet a wide variety of needs. Before taking on a job, contractors must determine what surface will be painted and what sort of treatment will the painted surface be subjected to. “Certain paints may not adhere to or worst ruin certain surfaces,” according to Fedele who has been in the industry for more than 18 years. As a refresher course for contractors, below is a look at some of the paint types on the market today. Alkyd or oil-based – This paint uses synthetic alkyd as resin and is solvent thinned. The combination of the two allows for a thick formula, which means a brush will carry more paint to the surface. Its opacity gives alkyd paints a high hide quality. Latex – Traditionally, latex paints contained rubber or some type of resin and water as a form of solvent or “vehicle” for the paint. Some manufacturers also call this type “water thinned,” “water reducible” or “acrylic latex” when the resin used is an acrylic or polyvinyl. Primers – A latex primer has the qualities of a latex paint. This odourless and quick drying formula is ideal for drywall, plaster and concrete. It can rust bare metal and raise the nap of raw wood so for these surfaces, it is best to use as an alkyd-based primer. Textured – Flawed surfaces and ceilings are ideal surfaces to cover with textured paint, which can either have sand-like granules suspended in it or come as a thick stucco-like substance that is applied to a surface and textured with special tools. Latex textured paint is typically used on bare drywall ceilings to hide seams between the sheets of drywall. Rubber-based – This paint contains liquefied rubber making it ideal for waterproofing concrete. Surfaces painted with rubber-based paint need to be sealed with a coat of varnish for extra protection. Concrete needs to be washed with a 10% solution of muriatic acid, rinsed thoroughly and dried before painting with rubberbased paint. continued on page 34...

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Feature

Dripless – The thick formulation so-called dripless paint is supposed to prevent spatters when working with this paint, says Fedele of Para Paints. The extra density of the paint unfortunately also means that it will not go as far as other paints. Fedele is wary of most dripless paint claims. “Other factors such as heavy pressure on a brush or roller as well as warm temperatures which affects the viscosity of paint can be responsible for spatters,” he says. “Be careful you might just be buying more expensive alkyd.” One-coat – The additional pigment on one-coat paints are meant to enable this paint (available in latex and alkyd versions) to cover surfaces with a single coat, but Fedele finds most of these claims questionable. “Just like the one-coat rollers, some products could be a mere farce.” Acoustic – This type of paint is designed to colour over acoustic tiles. The paint is formulated so that it does not completely cover the fibrous and textured surface of the tiles that help it absorb sound. It is advisable to use a sprayer to apply this paint. Trends and palettes: The growing concern over toxic materials and environment over the last 20 years has been pushing paint manufacturers to develop paints that contain less and less substances that emit flammable and poisonous fumes, says Jennifer

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Jones, communications manager for CIL Paints. “Everyone is going green and consumer demand is pushing towards low to zero volatile organic compounds (VOC) in paints,” she says. CIL, for example, has an ultra premium line of stain resistant low VOC paint called Allure. “Expect low VOC to appear in lower

photos: para paints

...continued from page 31

Feature enthuses, “will be ready for more feelgood and refreshing colours.” Light blues, honey or citric yellow and acidic greens are likely main colours while vibrant reds and warm orange will figure large in trims. Digital Grey, a grey with green undertones, was among the top selling colours for Para Paints in 2009, says Johanna McLellan, assistant brand manager for Para Paints, but homes are ready for brighter colours in 2010. “Designers and trendsetters are trying to infuse positive feelings into homes,” suggests McLellan. She sees the mergence of bright purples and yellows and a reinterpretation of some dark colours. “The biggest thing for 2010 will be deep jewel blue and the return of black and white. Yes, black is actually the new black.”

photos: cil paints

price brackets in the very near future because of consumer demand for the product,” Jones says. There is typically a $5 to $10 difference in prices between a manufacturer’s economy, contractor and premium lines. “Because more and more clients are looking for eco-friendly paints, a contractor who is familiar with the low VOC paints in different price ranges will be a valued adviser,” Jones adds. Apart from the environment, the economy it seems also plays a great part in establishing paint choices. The recession in 2009 brought more muted tones to most homes, according to Jones. She says there were a lot of subdued greens, blues and browns. With economic recovery in the news for 2010, homeowners, Jones

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Smart estimating versus guesstimating: Estimating a paint job can make or break a contractor’s profit, warns Fedele of Para Paints. Despite knowing better, many contractors fall prey to the temptation of bidding on a job without even actually seeing actual area to be painted. These professionals simply go by the general rule that a gallon of paint will cover an area about 400 to 450 square feet. Roughly, this means that a gallon of paint will cover a 10’x15’ room with one coat of paint. “It is crucial to see the job in blueprint and physically if possible because not all homes are constructed the same,” says Fedele. Stairs, odd corners and closets could have hidden bulkheads that will add surface area that needs to be painted for the job. “If you fail to identify these before bidding then you short change yourself by bidding too low and you will end up absorbing the cost.” Fedele, who started out as a painter himself, has these tips to offer. Be sure you know the area to be painted - Check the blueprints and see the area physically. Apart from hidden bulkheads you might be contracted to paint a lobby with a 30’ high ceiling. This would require extra tools and equipment that you need to add on to your price. Get your square footage right - Miscalculation could mean you are bidding too high or too low. You either lose the contract or get stuck with a very expensive one. Know your surface and your paint - Determine what type of surface you are painting on and what paint you will be using. For

example, previously painted surfaces may require extra time because the old coat needs to be stripped out or the job may require extra coats of paint to cover the old colour. The type of surface and paint will also determine what tools you will use. For instance, ceilings might require a roller, but if you are using or painting over textured paint, you will be better off with a sprayer. Schedule properly - Will you be working with or around other trades people? Are you hiring sub-contractors or extra painters? Make sure you get everyone’s schedule straightened out so that the job runs smoothly. Do not scrimp on prep work -- A paint job is only as good as the preparation work underneath it, according to Fedele. Prep work when done right might take as much as 75% of the work involved, but it always pays back a quality paint job that will last longer and win the contractor many positive recommendations. Make sure all areas that will not be painted and furniture are adequately covered or protected from spatters and spills. Keep an eye on nail holes and cracks that need to be filled and sanded. Wall stains need to be washed and primed with stain blocking primer. Check if the caulking around windows and trims are in good shape or need to be re-caulked. “Many might think this is the perfect area to cut corners because it is hidden from the eye, but bad craftsmanship always comes out in the end,” says Fedele.

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photo: cil paints

How To

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JANUARY/FEBRUARY 2010

CONTRACTOR ADVANTAGE

How To

t Basics Energy-efficient decisions extend downstairs and make spaces more inviting. By John G. Smith

CONTRACTOR ADVANTAGE

photos: steve harmon/istockphoto, James wardell

here was a time that basements were an after thought in home renovations. The dark caverns were seen more as a storage space than an extension of the living area, and the idea of an entertainment centre was often limited to something like a ping pong table outside the furnace room. Now that homeowners have accepted basements as a true extension of their living quarters, there should be little surprise that the marketâ&#x20AC;&#x2122;s growing interest in energy efficiency has extended downstairs. Options from compact fluorescent task lights to Energy Star windows all play a role in reducing utility bills, regardless of where they are found. The benefits hardly end there. While the choices concerning a furnace and water heater will have an obvious impact on energy efficiency, they can also play an important role in reclaiming space, and every inch can count in a basement renovation. A homeowner who wants to include a new pool table, for example, will need to accommodate both the table and a perimeter that is at least 6â&#x20AC;? wider than a favorite pool cue. The final shape of a room can even play a role in the sound from a newly installed entertainment system. If the dimensions are too square, the space will create the standing waves that can affect the bass.

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An un-insulated basement can account for almost half of the heat lost by an otherwise tightly sealed home.

the insulation is installed, any moisture will need to be addressed. “If it is a newly built house, you are still going to have a lot of moisture in the walls, and it tends to draw inwards,” adds Paraic Lally, residential business manager with Roxul Insulation. “When you insulate a basement, you slow the heat loss through the wall,

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photos: Dow Building Solutions, Roxul

The best options here will be a rectangular space that leaves a length, width and height that cannot be divided by a common denominator. The replacement of a 40-gallon water heater could make a significant difference when it comes to finding some extra room for other uses. Unlike their traditional counterparts, energy-efficient tankless water heaters can be installed inside cabinets or elsewhere in the home, closer to the point where the water is actually used. The shift to a new gas furnace with an Energy Star rating, complete with an Annual Fuel Utilization Efficiency (AFUE) of 90-97% may present the chance to choose a unit with a smaller footprint of its own. Of course, there are some practical considerations when looking to relocate the unit into a far-off corner. Any space-saving move that adds three or four 90° bends in the ductwork will have an obvious impact on the flow of air to the upper floors of the house. As important as the choice of these appliances will be, contractors also need to pay close attention to the options that will help to maintain heat within the basement walls. An un-insulated basement can account for almost half of the heat lost by an otherwise tightly sealed home, according to Dow Building Solutions. A 7” slab of poured concrete barely matches the insulating value of a pane of glass, measuring in with an R value of 1.5. Instead of warming the space, the output from the brand-new furnace will escape through the un-insulated wall, while a cold basement floor can even act like a heat sink. “Obviously we encourage homes to be built right the first time,” notes John Hammer, Dow Building Solutions’ North American marketing manager for residential construction, referring to the value of 2” of insulation on the outside of the foundation. “We know a lot of builders do not do that. It is not something that people see.” An energy-efficient retrofit does not require an excavation around the home; however. Just consider the changes that can be made at the sill box. “You have a space between the top of the foundation and the floor, and it is highly recommended to air seal, to insulate in those spaces,” Hammer says, referring to the process that can begin with an application of spray foam, followed by a layer of batting and flashing. Compared to the insulation choices that are made elsewhere in the house, the options in a basement will need to pay particular attention to the threat of moisture and mold. This means that before

Agency: Brickworks Communications Inc. (905) 632-8772 Artist: Erinn McSherry x113 Client: CertainTeed CT143 M2Tech Ad_ContAdv • PDF Publication: Contractor Advantage 8.125 x 10.875” trim + bleed 4 colour, Apr. 7, 2008

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How To choices. Structural issues will need to be addressed, although it is easier to enlarge an opening in a block foundation than trying to knock through its poured counterpart. The shape of the opening will dictate some of the related design options. A typical basement window, which is wider than it is tall, will lend itself to the use of a horizontal slider window, but those who want to increase the amount of glass can choose an awning window that has the hinge along the top, eliminating the frame that would otherwise drop down the centre of the window. “You have to look for a window that seals properly,” West adds, referring to other choices that will improve energy efficiency. “You are looking for at least two places with weather stripping, so you have a primary and a secondary defense against the weather.”

The shift to a new, energyefficient window will even present other opportunities to make the basement more inviting.

al –

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7 1:43:11 PM

which is what you want to do, but that also slows the movement of air drying the wall. It exacerbates the issue.” The solution here can include fitting the insulation away from the outside walls, and completely sealing the space to avoid the movement of air. “If air can move through those gaps, then the air conducting itself through the gaps reduces the performance of the wall system,” says Lally. A layer of rigid insulation made of a mineral wool or foam will develop the required thermal bridge. The closed cells in a sheet of rigid foam insulation, meanwhile, are designed to resist moisture, and can be installed right over a masonry wall without any studs. In an area where space is at a premium, this approach can also recover a few valuable inches when compared to a standard framing job. A polystyrene compatible adhesive can be used to attach a product like Styrofoam Wallmate directly to the concrete, and this option includes slots for the 1x3 or 1x4 furring strips that can be nailed or screwed in place to support a sheet of gypsum. The use of 2x3 strips, meanwhile, will leave enough space for some electrical conduit as well. Another option comes from a rock wool insulation made from a combination of basalt and recycled slag. The end result is three times as dense as fibreglass batting, resisting moisture and fire in additional to offering good thermal and acoustic values, says Lally. When dealing with any batting, installers need to ensure that it is not compressed too much into the space, he adds. “Do not pinch and do not leave gaps.” Granted, walls are not the only surfaces to insulate. Anyone who installs a radiant heating system into the floor will need to install enough rigid foam insulation at the end of the floor and under the slab to maintain a comfortable temperature. Given the fact that heat rises, a ceiling deserves special attention as well. The insulation options can also offer more than lower energy requirements. Combined with resilient channels, the insulation in a basement ceiling will also help to keep any noise downstairs, which will make the space that much more practical. With an eye to energy efficiency, the insulation considerations also extend to the choice of windows and doors. “When people have older houses and replace windows, these are the last ones they think of,” admits Brad West, Jeld-Wen Windows and Doors’ director of sales, Eastern Canada. Yet any upgrade from a single layer of glass will obviously benefit from a shift to “low-E” Energy Star window. The shift to a new, energy-efficient window will even present other opportunities to make the basement more inviting. “Part of a basement renovation with respect to windows is the option to open up the space a little bit depending on the slope of the lot,” West explains. “If you are working on a house in the side of a hill, with a conventional basement, with the window at the top, there might be an opportunity to create a larger window.” There are additional steps to consider when making these

Low-maintenance features will be particularly important on any of these windows that reach down to the level of the lot, where they will be exposed to moisture and mud. A vinyl frame, for example, will not warp, split or rot in these conditions. The exposed surfaces also make it particularly important to properly seal and flash the newly installed option. It is not the only area where energy-efficient windows can be introduced, either. “If you are doing a basement renovation that has an existing door, look for options to let in more light,” West says. “If the house has a basement walkout and a single door with no glass in it, there is a tremendous opportunity to let in more light.” There are features and options that would be welcome in any energy-efficient renovation project.

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Feature

Garages Are Not

Just For Cars

Anymore By Lawrence Cummer

While a lot of garage jobs are simple do-it-yourself activities, the overhauls that some need provide some great business opportunities for contractors, especially those who specialize in closet building and window or door installation.

JANUARY/FEBRUARY 2010

CONTRACTOR ADVANTAGE

Feature

“Because of the cost of property today people are utilizing every inch of their property, which has resulted in garages getting facelifts,” she adds. “They are getting new siding on the exterior, there are absolutely beautiful doors out there, the interiors are being finished and the floors are being treated. “Storage is being highly organized. That is the bottom line; homeowners are making the most of what was otherwise a highly underutilized part of the property.” Baldwin says that one of the most innovative garages her company has built was done with aesthetics and purpose in mind. She noted that particularly beautiful framing was used and the roof was built using flexiglass sheeting to allow natural light to shine through. Half of this double garage was still being used to park a car, but other half became the extension to a small backyard patio. This allowed the homeowner to use the garage almost like a gazebo for parties and meals. Products for the garage, such as new types of storage systems and safer door systems, continue to evolve, giving contractors an opportunity to educate clients on better ways of dealing with old problems of clutter and heating that traditionally plague garages and increase their margins and business. As well, some new twists are being made using traditional products. Garage Doors: A lot more thought is going into garage door installs these days, says Travis Reynolds, national marketing manager for Steel-Craft Door Products Ltd. “Over the last decade, and even more recently, it has become a much more impor-

photos: James Wardell

omeowners are increasingly looking for ways to makeover the garage in order to create an alternative living space and free up room in the house itself. While a lot of garage jobs are simple do-it-yourself activities, the overhauls that some need provide some great business opportunities for contractors, especially those who specialize in closet building and window or door installation. Many experts note that the majority of homeowners only start looking to garage improvements once everything inside the home has been improved. Still, a recent survey by Rust-Oleum Corp. found that upwards of 55% of homeowners are using their garages for more than car and lawn mower storage. The survey also found that 45% of them are spending between one or two hours in a garage to either conduct hobbies or even do business. Jim Coles, brand manager for highperformance coatings at Rust-Oleum, says there are two primary reasons homeowners look to improve the appearance and function of their garages: they see it as a means to increase overall living space and, conversely, view it as a place to create new storage areas. Car enthusiasts have even been known to create their own showrooms. “It could also become a type of man cave,” says Coles. “Throw a sofa in there, hang a big-screen TV on the wall, and have the boys over for Sunday afternoon beer and football.” It is, says Sandra Baldwin, president of Lifetime Contractor Ltd., becoming an area of greater alternative use, especially in urban areas with high property costs.

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tant decision in the home,” Reynolds says. “There used to be a time when you would take any old standard raised-panel garage door and install it.” Reynolds says a broad selection of options combined with the ease of finding information (from the Internet and other sources) has made homeowners more particular about the type of door they want, especially in newly-built homes where the garage often represents a large portion of the street-view façade. John Ward, dealer support manager at Creative Door Services Ltd. agrees, adding that as homeowners look to do unique makeovers, some are going so far as to request commercial glass-pane doors (like those found in service stations) to bring that coveted natural light into their “man caves” or family game rooms. While the actual mechanics of garage doors have changed very little in the past 30 years, there have been some important innovations in recent years that contractors should be aware of. The biggest change, says Ward, revolve around safety and he notes that some models of garage door now boast pinch-resistant sections. He says this and other safety technologies are important considerations to present to the homeowner. “Believe it or not there have been numerous incidences where children or other people have been playing near garages and as the door was coming down they got their fingers caught in the sections.” When it comes to the physical installation, another important safety innovation is use of a drill- or socket-based winding system (such as Wayne-Dalton’s TorqueMaster system), rather than a more traditional torsion spring winding system. Regardless of the winding system used in the door, Ward stresses that it is crucial to closely follow the manufacturer installation instructions. Specifically, torsion and expansion spring lift mechanisms are areas where contractors can seriously harm themselves by using the wrong winding tools or not following procedures correctly. Torsion spring doors, for example, require professional winding bars (residential bars are 1/2” by 18” long and commercial

JANUARY/FEBRUARY 2010

CONTRACTOR ADVANTAGE

are 5/8” by 24”). Ward says there have been incidents in the past where contractors (and DIYers) have instead used rebar, screwdrivers and socket extensions to wind torsion springs, they have put springs on backwards (when they are designated right- or left-hand wound) and have not properly clamped off the tube shaft when winding or unwinding the springs. Garage Floors: Many homeowners want to make a garage floor useable as a living or hobby space while still accommodating a car, which will require some type of floor coating. According to Coles, one of the most popular is an epoxy, such as Rust-Oleum’s Epoxy Shield. Such coatings require only one coat and make it easy to clean away inevitable dust build up, as well as combating abrasion, chemicals and stains. Rust-Oleum’s product works by combining a two-part epoxy base with water, applying the coating to the floor and then scattering paint chips by hand onto the coated floor. While simple enough to be a DIY job, contractors can add the floor coating as part of an overall garage makeover or renovation. It is the kind of added value that brings a final professional polish

photos: photos.com, Garaga inc., rust-oleum consumer brands canada

Feature

photos: knape & vogt, rust-oleum consumer brands canada

Feature to the contractor’s work, suggests Coles. “If you have put up drywall and painted it, or put up shelving units and you really want to finish it off well, for the investment of a couple of hundred dollars on the flooring by the contractor, you can mark it up and make a nice profit.” When it comes to doing a professional job with garage floor coating, the most important step involves proper preparation. Garages are infamously dirty. “It does not matter what you put on the floor, if you do not do the prep it is not going to stick,” Coles notes. If there is any grease or automotive fluid on the floor first apply a heavy-duty cleaner/degreaser. In addition, contractors should apply a patch and repair kit if there are cracks in the garage floor. Finally the concrete should be further cleaned and etched with acid in preparation for the coating. Coles says contractors and homeowners are looking to more environmentally safe acids, such as a citric acid-based etching product. More traditional muriatic (or hydrochloric) acid etching products require additional safety precautions. Muriatic acid has a corrosive effect on human tissue from both the solution and its mist, requiring masks, PVC or rubber cloves, protective eye wear and chemical-resistant clothing. In contrast a citric acid-based solution requires gloves and run off is not harmful to the trees and grass along the side of the driveway when it is rinsed away after application. When the epoxy is finally applied it is important to let it sit and cure based on the garage’s use: about eight hours for light foot traffic to four days to support driving a car on it. For those car enthusiasts, the added polish of a premium clearcoat gloss can be applied over the epoxy coating, says Coles. “Premium clear coating makes it look like a new car show room. You get that beautiful bounce off of the floor surface. You can virtually see your face in it,” he says. “Again, it is not very expensive for a contractor to buy and throw into the sale, but it does require him to come back one more time.” Storage: Garage storage continues to be the largest growing area of the storage product market, despite the recession, says Robert

Livingston, product manager at Knape & Vogt Manufacturing Co. Livingston attributes this to the fact that as basements in homes have become finished and furnished into living spaces; storage has gradually spilt over into the garage, creating a storage nightmare for many homeowners. Research conducted by Knape & Vogt has found that about 35% of garages are no longer housing an automobile or motorcycle, while nearly half cannot fit a car. Even around 15% of two-stall garages do not have room for a car, Livingston says.

As homeowners are asking for innovative new approaches to storage. Knape & Vogt has developed the Matrix wall organization system; a rail-based storage system that integrates shelving, standards and brackets, hang rails and a variety of hooks in order to lift various tools and objects of different shapes and sizes off the floor. Livingston says it is the only such system that does not require a lot of tool use and the drilling of multiple holes in the wall to make adjustments and changes after installation. Storage products are of particular interest for closet builders, he says, because they are already in the business of helping their clients deal with their storage problems. In addition, by consolidating storage into one small area, a contractor can wall the area off, add a side door and create a “storage shed” inside the garage allowing the rest to be used by the homeowner. Garage improvements are not all just about beauty and performance. According to Baldwin, homeowners are asking more and more for their contractors to focus on using only environmentallyapproved materials and improvements. For example, the R-value of garage doors has become a major factor in homeowner’s choices, to better reduce energy consumption in a heated garage. In the end though, the final look of this previously often ignored part of the home is playing a bigger part than the environment. “Everyone wants something unique and they want to be different from the neighbour in what they are showcasing,” says SteelCraft’s Reynolds.

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Feature

Cooking up recession-proof business

JANUARY/FEBRUARY 2010

CONTRACTOR ADVANTAGE

Feature

While many are cutting back on home renovations during the economic downturn, cost-effective kitchens can provide a stream of work for the home contractor. By lawrence cummer

photos: photos.com, Belanger Laminates VT industries inc.

itchens are the heart of most homes and few homeowners are willing to let them go to pot even in tough economic times. In fact, many have been looking to kitchen renovations to try to make use of programs such as the Home Renovation Tax Credit (HRTC) offered by the federal government before it runs out on February 1. Experts say the renovations many homeowners are asking for are often less elaborate than in the past since they are attempting to find ways for a fresh look, while spending less. Sandra Baldwin is president of Toronto-based A. Lifetime Contractor Ltd., who chairs the organization’s Renovators’ Council, says today’s approach to the kitchen is a call back to older days of farmhouses where kitchens were the natural place for people to spend long periods of time in. “The family gravitates there and now we are socializing there too. It is all very chic to be chopping up your veggies and prepping dinner, while your guests are sipping wine,” she says. As a result, open-air kitchens, where the dividing wall between the kitchen and dining or living room has been removed, are currently a

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popular trend in modern kitchens. They are becoming even more visible than in the past, it is that much more important to make them beautiful. Kitchens remain the major areas of renovation investments today, but generally only after investments are investigated around energy efficiency and an energy audit is done. Homeowners are in the market for affordable ways to spruce up their cooking and entertaining space; for example, through new cabinetry, storage or countertops. Many are looking for contractors to help give their kitchens “facelifts” rather than the more complete overhaul. They are also initiating smaller kitchen projects (such as replacing cabinet doors) that are more manageable with today’s economy, while still allowing them to take advantage of programs like the HRTC.

Putting a new face on cabinets: The cabinet industry recently has been more focused on renovations than new home builds, says John Lamb, sales manager for Euro-Rite Cabinets Ltd. of Port Coquitlam, B.C. Lamb says homeowners are deciding to stay longer in their existing homes and improve them, which is good news for contractors with cabinetry and renovation expertise. “We have seen a dramatic upturn in the reno market, so specifically the renovation contractors are finding themselves very busy,” he says. A few trends emerged over the year in cabinetry, with customers looking primarily at value, quality and affordability. “People are cutting their cloth a little bit more according to their means,” Lamb says. “They are very aware of the different looks available for kitchens, but they are also keeping one eye on the pocket book. It is a value-driven market at this point.” Lamb says that this price-consciousness has led to high-end custom cabinet giving market share to more ready-to-assemble cabinets. He adds that today, 80% of kitchen renovations have standard-sized cabinets regardless of whether they are custom builds or not. To compete, Lamb suggests that a lot of high-end cabinetry manufacturers are dropping their prices and attempting to play in the ready-to-assemble market. He says that the look customers are asking for is being heavily driven by home renovation shows on television. There is a continued trend toward the staggered look found in high-end cabinets, but offered at a lower cost. These days there is a move toward darker coloured cabinets, but colours come and go with fashion and Lamb has no doubt it will give way to consumers seeking lighter colours. Safe perennial colour choices of whites, oaks and maples make up the vast majority of sales and have for decades. In this economy, contractors can be in greater danger of cutting corners on cabinetry installs and not closely listening to customer needs. Another place where cabinetry installation can run amok is by not developing a proper timeline and work-back schedule. “Most all contractors mean well, they sometimes just do not stand back and breathe and say ‘this is what we need to do,’” says Lamb. “You can match stuff off the shelf, but it might not be what the consumer wants. Plan, listen and measure.” In the end, it is hard to establish a single kitchen appearance that homeowners look for as they try to differentiate themselves in this continued on page 55...

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photos: eurorite

Feature

Green Friendly:

Tips And Advice For The C What Is A LEED Home? A LEED home has been certified by an independent third party, the Canada Green Building Council, as having met the requirements of the LEED Canada for Homes rating system. What is different about a LEED home? • Lower energy and water bills • Reduced greenhouse gas emissions • Less exposure to mold, mildew and other indoor toxins • Operational cost efficient • Best industry practices What is similar? • LEED homes can be any ‘style’ • Have same functions as regular homes Source: LEED Canada For Homes

JANUARY/FEBRUARY 2010

Volatile Organic Compounds (VOC) Substances are often found in new homes that release vapours at room temperature. These chemicals are inhaled and absorbed into the skin of inhabitants which can be unhealthy. Careful selection of paints, adhesives and other materials with limited or no VOCs combined with an effective ventilation system reduces these toxins and produces a healthier living environment. Source: Effect Home Builders Ltd.

6,000+ LEED APs More than 6,000 people have become LEED Accredited Professionals (LEED APs) in Canada since 2001. LEED APs work in every sector of the building industry, and

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have demonstrated a thorough understanding of green building practices and principles and familiarity with LEED requirements, resources, and processes. Source: Canada Green Building Council

Green Building Study A study by CoStar Group found that sustainable “green” buildings outperform their peer non-green assets in key areas such as occupancy, sale price and rental rates, sometimes by wide margins. The results indicate a broader demand by property investors and tenants for buildings that have earned either LEED certification or the Energy Star label and strengthen the “business case” for green buildings, which proponents have increasingly cast as financially sound investments.

he Contractor Professional According to the study, LEED buildings command rent premiums of $11.24 per square foot over their non-LEED peers and have 3.8% higher occupancy. Rental rates in Energy Star buildings represent a $2.38 per square foot premium over comparable non-Energy Star buildings and have 3.6% higher occupancy.

Making A Pitch For Wood Wood products require less energy to extract, process and transport than steel or concrete, and wood-framed buildings are more energy-efficient, costing less to construct and operate over time. Wood is 400 times better than steel and 10 times better than concrete in resisting the flow of heat. Wood buildings require much less insulation to retain their warmth. Source: PlanetFriendlyCanada.com

LEED Canada-NC 1.0 The LEED Canada-NC 1.0 rating system applies to new construction and major renovations of commercial and institutional buildings, i.e., buildings regulated by Part 3 of the National Building Code. It also applies to retail, mid- and high-rise multi-unit residential buildings (MURBs), public assembly buildings, manufacturing plants, and other types of buildings. Provision is also made for up to 10% of

the building floor area (20% in the case of mixed-use buildings) to be completely exempted.For details, see the Application Guide for Core and Shell Buildings and Leased Tenant Spaces. The guide can be downloaded from the ‘my documents’ section of “MyCaGBC”. The document is free to CaGBC members, and available for $55 for non-members. The Web site is www.cagbc.org. Source: Canada Green Building Council

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particular room. Nancy Bedard, marketing supervisor at Bélanger Laminates of Montreal says the kitchen trends she is seeing most requested from contractors and homeowners are, in fact, opposites: on one hand a “modern chic” look is popular, while on the other owners are looking for a very rustic, “country-like” appearance. Making counters look tops: Bélanger manufactures thermal doors for cabinets as well as countertops. Bedard says that consumer trends have moved away from a more standard round-radius shaped, speckled counter top. Today, laminate counter tops that mimic expensive materials, like granite are in vogue. She attributes this to economizing. While a granite countertop could run $4,000 to $8,000, the same top made from laminate, but to look like granite, would be about $2,000. Further, patterns on the laminate no longer repeat with the frequency they once did, better creating the illusion of the material being imitated. Whereas a 12’ length would once see as many as 60 repeats of the same pattern, they are now being repeated as little as once every five feet. She urges contractors to investigate laminate with a granite appearance as an alternative for clients looking to improve their kitchens, but with limited budgets. Spending less on a countertop allows homeowners to refit with greater frequency as fashion trends change or they become bored. While Baldwin agrees that homeowners are cutting renovation budgets, she believes countertops are one place they are often willing to spend the money. As an example, one trend requested more often is solid surface countertops with an integrated sink. “Homeowners will be a little more cost controlled on the cabinets and when it comes to the finishing touches it is tough to get them to compromise on things like the countertop,” says Baldwin. “If they want a solid surface, they will get a solid surface. They might embellish with a few things like handles and knobs and finishing touches that act like jewelry on a kitchen.” Making a splash with affordable details: With so much tied to the appearance of that “jewelled” kitchen, the devil is in the details, notes Baldwin. Final touches and flair can make or break the customer’s opinion of the end result and the contractor. One final touch homeowners are often seeking is the backsplash. While typical choices of tiled backsplash might be a bit much for a kitchen on a budget, a new option has emerged recently, according to Tim Creech, national product manager for CanWel’s Building Materials Division. CanWel has started to distribute a backsplash made from tile board manufactured by DPI Inc. The boards, which are available in 1’ by 4’ by 8’ sheets, emulate traditional tile, but are easier to apply and clean. Although traditionally used in the bathrooms and mud rooms, tile board is now making a move to the kitchen, Creech says. “They have realized that customers do not want to have to paint, and consumers do not want to spend a lot of money on

a ceramic backsplash,” he says. “If you are a contractor doing a reno and your customers are looking to economize, this tile board looks just like ceramic tile and is, in fact, better because you do not have grout lines.” As recycling becomes more of a habit, another little detail that can make a difference is ensuring cabinetry is conducive to the form factor of recycling and garbage storage (and vice versa), says Miles Mullins, product manager for kitchens and bath products at Knape & Vogt. Mullins says homeowners are demanding better space utilization and as a result, his company has developed 35-quart and 50-quart waste bins on a 12” or 15” chassis that will incorporate into standard cabinet openings. A 12” chassis allows a single bin, while a 15” one permits two bins for proper sorting. In fact, customer concerns around recycling do not start when the kitch-

en is finished and in use. Waste from the actual renovation is an area of increased concern for homeowners and they are looking for contractors who understand proper disposal of materials and are minimizing impact on the environment, according to Baldwin. “We generate a lot of stuff when renovating and not necessarily garbage. They are commodities that must be separated and redirected.” When contractors do fall short on kitchen renovations it is often because they fail to recognize the enormity of their role, Baldwin says. There are so many elements to a kitchen and they require a lot more client communication and hand-holding than many other jobs.

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Feature

Fighting the Beetle and the Damage Done Canada’s lumber industry is being attacked by everything from insects to a struggling housing sector, but contractors can find some hope in the mix. By John G. Smith

JANUARY/FEBRUARY 2010

CONTRACTOR ADVANTAGE

photos: city of richmond

anada’s speed skaters will be looking to send a message to the world as they take to the ice of the Richmond Olympic Oval during the 2010 Olympic Games. This is the sport that made household names of athletes such as Jeremy Wotherspoon, Cindy Klassen and Catriona Le May Doan. It is a venue where our dreams of Olympic glory can be realized. Many of Western Canada’s lumber suppliers hope the building will convey a message of its own. The massive roof over the skating surface has been created with lodgepole pine that carries the telltale blue stains of an attack by mountain pine beetles, and those behind the choice want to prove the lumber is structurally sound as long as it is harvested as quickly as possible.

Feature

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Feature

The Mountain Pine Beetle (left) measures 1/8 to 1/3" in length. Cross sections (above and right) show damage, including Blue Stain, right. There is no denying that the beetles have made their mark on products and producers alike. The damage begins when the ricesized pests bore through the bark and make a home for themselves in the layer below it. The Blue Stain Fungi are just along for the ride, but they are ultimately responsible for cutting off the flow of water and nutrients. The stain sets into the wood. The needles turn to the colour of rust. The old trees die first, and then the others follow. Then the surrounding lumber mills begin to close. Few things seem to be going right for the lumber industry that supplies raw materials to the nation’s contractors. Canada’s forests may boast some of the most desired spruce, pine and fir in the world, but the forestry industry is “not healthy” for a number of reasons, says Brady Whittaker of the Alberta Forest Products Association. Challenges from the mountain pine beetle to a collapsing U.S. housing industry have all driven down prices and demand alike. Construction activity in the U.S., which represents the largest market for Canadian lumber, has come to a virtual standstill. Housing starts in the first half of 2009 plunged to 50year lows, and analysts believe it will be years before the need begins to recover. Even in Canada, housing starts are expected to sit below 160,000 units next year, and those levels have not been seen since early in the decade, notes a recent report by TD Economics. “The huge drop in the U.S. housing starts has just kicked the heck out of the industry,” agrees Rick Brouckxon, LP Building Products’ national sales manager for engineered wood products. That has led to inflated supplies and low prices for everything from OSB to lumber, at least for the short term.

That is not entirely bad news for contractors who are placing their orders. “The product can be purchased at a lower price, which is an advantage to the purchaser,” Whittaker admits. “It goes back to Grade 10 economics: supply and demand.” Although inventories have dropped to their lowest levels in five years, giving producers a greater influence over prices, the cost of lumber is not expected to return to traditional levels until 2011, TD Economics suggests. The economic realities have even had

an impact on the use of prefabricated roof trusses. “There are some areas that roof framing has bounced back a little bit because lumber is inexpensive and there are a number of framers looking for the work,” Brouckxon adds, referring to pockets around Windsor, Ont. as an example. While it is a buyer’s market, contractors do not need to look too far until they find how they can be affected by the lumber industry’s challenges. For example, the struggling business environment can have a direct impact on product advances. “Part

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Feature of the problem you face with protracted long periods of low pricing is the producers do not have any cash for product development,” Brouckxon says. The mountain pine beetle has on its own wiped entire mill towns off the map in central B.C., and the province’s forestry minister recently warned that eight to twelve sawmills could close because of the pest damage. This will undoubtedly limit the business opportunities for any contractors who serve the area, and the challenges are hardly limited to western provinces. Researchers at Natural Resources Canada suggest that the pest was traditionally controlled by cold weather, but that changed once winters became warmer. Allowed to multiply, the insect has now decimated 46% of B.C.’s pine. In the hard hit forests of the central Rockies, nearly two-thirds of lodgepole pine forests have been killed. Now the destructive path is stretching east into Alberta. The jackpine forests of the Prairies and Eastern Canada are expected to be next. The industry will not go down without a fight. Efforts to combat the pests have included using a synthetic hormone to lure beetles into a contained area where they can be destroyed. Other options for the infected wood are also being explored. Researchers at the University of Northern British Columbia believe they have found the way to use the timber to make boards that look like a cross between plywood and concrete. In addition to accepting nails without any pre-drilling, it can be cut with traditional woodworking tools. This could introduce an entirely new option when building everything from countertops to flooring. There are other signs of hope. According to a report by the federal government, The State of Canada’s Forests 2009, wet weather helped to limit the number of forest fires in 2008. Even the rate of damage by the mountain pine beetle has begun to decline in B.C., in part because the winters are turning colder in some regions. The current economic realities may also inject some additional creativity into the products that are available to contractors. While

Learn to read stamp of approval on your lumber

1 3 4

lumber producers once focused on the simple harvesting of 2x4's, they are now exploring new options around building systems and assemblies, notes the federal State of Canada’s Forests. Whittaker, for example, points to Europe’s Cross Laminated Timber that he expects to become more popular in North America. Suppliers are able to create slabs that are 4” thick and up to 50’ long by layering 2x4's at right angles to each other, he says. “They are manufacturing these panels and building nine-storey buildings out of wood.” Canadian suppliers are in a good position to leverage the growing interest in environmentally sustainable products as well. Our forests account for 40% of the “greener” supplies that are certified by independent agencies. The Forest Products Association of Canada notes that the nation’s forestry industry will become the first carbon-neutral sector of our economy as early as 2015. While Canada harvests 0.5% of its commercial forests every year, it grows twice as much as that. “There are more educated consumers and customers in general in terms of buying green products,” Brouckxon says. “In general, wood still has huge advantages over the number of materials out there from an energy consumption aspect.” The push for sustainability is being reflected by purchasers, retailers and consumers alike, adds Whittaker. “They want to ensure the product they buy comes from a forest that is managed in an environmentally sound fashion.” Third-party support has made it possible to identify these practices, through stamps of approval from groups such as Canadian Standards Association and Forest Stewardship Council. As difficult as the challenges are, industry analysts note that situations have begun to improve. They have a long way to climb, but prices and demand are both expected to improve in 2010, along with a slight growth in U.S. housing starts as long as the value of the Canadian dollar does not spiral out of control. These are all factors which could help undo the damage that a beetle could create.

Every supply of lumber is stamped with information that accounts for the way the wood can be used, along with a variety of related details including: 1. The certified agency’s symbol 2. The mill identification number 3. Species 4. Seasoned condition, such as whether the lumber was dried in a kiln 5. The grade name or number A Select Structural grade of lumber is used when a high stiffness and good appearance are required, and most of the lumber used in general construction has a grade of Number 1 or 2. The differences between the three options relate to appearance and strength. For light framing, the top two grades can be combined to make a Standard and Better grade that will carry a reduced strength and stiffness when compared to a Number 2 offering. A Stud grade of lumber has the characteristics needed to frame a wall. In contrast, a Number 3 Utility and Economy grade is limited to uses such as creating a brace or manufacturing crates and pallets. Source: Alberta Forest Products Association

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Controlling Risk Management

â&#x20AC;&#x2DC;I believe the days are over that you can look at each risk as a silo. You must see all your risks as connected.â&#x20AC;&#x2122; By Mark Beckham

In all our previous articles we have focused on the Castlecare group insurance program developed for your employees and offered to you by Castle. There is nothing else like it, and for many it might be the only plan available to you and your employees. In this article I want to provide you with more reasons to consider Castlecare. To illustrate this, I will use a diagram that explains it in its simplest form as a true risk management solution. Does it look complicated? It is not. Let us start with the basics. The traditional insurance process goes something like this: you meet a broker and decide to do business; you assume that he or she gets you the best product at the best price with the best carrier. Along with that assumption you hope to get a bit of service. Over the course of a year you use the insurance program, whether group or commercial. The broker then comes back with the renewal. If you have used it (and sometimes even if you have not), you face an increase. The explanation given makes sense, of course, peppered with words like credibility, pooling, inflation, reinsurance markets and a gaggle of other terms that mean absolutely nothing to you. All you care about is the bottom line. If you accept the renewal, another year begins and back around the annual cycle you go. When the next renewal is presented to you, guess what happens? You face another increase. At some point you get angry

with the results and ever escalating costs and decide to move carriers or brokers. The reality is all you have done is to start the process over again with new players. It is a never ending cycle of increases and the frustrations that go along with them. You have not tackled the real root of the issue, which is that there must be a relationship between you, the broker and the carrier. You must all be working together to

communicate effective tools that help you reduce or at least control your total risk management costs. I believe the days are over that you can look at each risk as a silo. You must see all your risks as connected. We developed Castlecare as a means of controlling all your risk management costs. Does the diagram now begin to make sense? Let me give you some more explanation. The yellow circle is the group insurance circle. You already know enough about this. Castle offers you a great pro-

Mark Beckham, BSc, is one of the Principals of Bencom FSGI (Financial Services Group Inc.)â&#x20AC;Ż His professional experience includes employee benefits and financial services including retirement products and insurance. He can be reached at mark@bencomfsgi.com or by telephone at 888-664-5555 ext. 301.

JANUARY/FEBRUARY 2010

CONTRACTOR ADVANTAGE

gram to cover you and your employees in the event of a death, disability, health or dental issue. The blue circle is your registered savings. There is no doubt that we can increase your return by lowering the management fees charged by the banks or other institutions you use. Everyone likes having more money in their pockets. The green circle represents all the insurance products you need as an owner to protect yourself and your business in the event something happens to you or a key employee. Does it not make sense to protect your largest asset? Your business is that asset. The black circle represents the advice we can give to maximize the returns in your non-registered portfolio. Again, we like to show you the money. Finally, the purple circle includes all the value adds that Castlecare offers, like competitive pricing for your commercial insurance, or providing templates for you to make up your will or shareholders agreement. This is the circle that really ties it all together. This is where you truly get involved. I believe that if you choose not to look at these benefits then you will continue on the path of escalating costs and frustration. You will only have yourself to blame, since Castlecare has the solution. If you take complete advantage of Castlecare, the overall risks you face on a dayto-day basis are minimized. You can have confidence that in all areas of your risk management strategy you have the best product, carrier and price. In addition, you will have the peace of mind that comes from knowing the advice you receive is truly in your best interests. You become engaged in the risk reduction process and you will have become an ideal client.

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