July 2021
A BONUS FOR THE BONUS ROOM p. 12
A RECIPE FOR AVOIDING DISASTER p. 22
TO WHOM ARE YOU REFERRING? p. 28
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BUILDING A C C E L E R AT I O N
CONTENTS
J U LY 2 0 2 1
16
12 A BONUS FOR THE BONUS ROOM
Here’s an alternative to the traditional attic truss
16 PEAKING AT THE RIGHT TIME TCM’s journey in starting a new truss plant is full of insight
22 A RECIPE FOR AVOIDING DISASTER
Here are the proven ingredients to manage workers’ compensation insurance costs
12
28 TO WHOM ARE YOU REFERRING?
Incentivize your current employees to help you find your future team
22
28
IN EACH ISSUE
5 EDITOR'S MESSAGE Doing a Good Job
9 PRESIDENT'S MESSAGE Open for Business ON OUR COVER TCM Enterprises started Summit Structural Systems to fill a growing need for wood
component framing in the Southcentral U.S.
JULY 2 0 2 1
3
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THE OFFICIAL PUBLICATION OF THE STRUCTURAL BUILDING COMPONENTS ASSOCIATION
editor’s message
PUBLISHER
Structural Building Components Association SBCA PRESIDENT
Mike Ruede
EXECUTIVE DIRECTOR
Jess Lohse
MANAGING EDITOR
Sean Shields
ART DIRECTOR
Doing a Good Job The builder/GC needs to drive better communication between trades
Glenna Stocks/Stocks Creative ADVERTISING SALES
Ashley Stroder
ACCOUNTS RECEIVABLE
Jennifer Gustafson
DIRECT ALL INQUIRIES TO:
2701 E. Grauwyler Rd. Building 1, DPT#1026, Irving, Texas, 75061-3414 DIRECT ALL PAYMENTS TO:
SBCA PO Box 88671 Milwaukee, WI 53288-8671 224-244-5204 media@sbcacomponents.com sbcacomponents.com
IN A RECENT CONVERSATION WITH
or foundation that didn’t match the
department manager for Carpenter
supplier of the framing package to
HOWARD GAUGER, engineering Contractors of America (CCA), he
made a comment that sparked a two-
session podcast exploring the benefits of offsite construction (listen at: sbcacomponents.com/media). That com-
ment was essentially, “everyone wants to do a good job.”
At first glance, a sentiment like
and power to run successful, growing, profitable companies offering a compelling competitive advantage in the marketplace for their customers, and to offer professional growth for their employees. SBCA's magazine is one of the many tools it uses to deliver on its mission for the betterment of the industry and the broader construction supply chain. The opinions expressed herein are those of the authors and those quoted, and are not necessarily the opinions of SBCA.
Copyright ©2021 by the Structural Building Components Association
mostly comes down to the percep-
tion that wood is more malleable than stone and therefore it’s cheaper to
adjust the framing than the founda-
tion. Whether this is true depends to a great degree on the project.
As Howard and I explored that per-
ception, Howard observed that many
astute observation when applied to
result of poor craftsmanship, but a lack
appear overly optimistic, but it's an companies instead of individuals.
reasons to underperform or overperAssociation (SBCA) is for its members to gain knowledge
fix the error. This standard approach
that in the construction industry may
Individuals may have any number of
The mission of Structural Building Components
plans and the customer put it on the
form at work, but companies con-
tinually strive to be good, if not great, to survive and grow. A contracting
business, whether it’s a plumber or a
times foundation errors weren’t the
of understanding about the crucial elements in a given project. Just as most
component manufacturers (CMs) aren’t experts in plumbing or excavation, the other trades aren’t experts in framing and load paths.
Howard argues that if the concrete
framer, is organized and structured to
contractor has a better understanding
more good work.
are, and what tolerances are accept-
do good work, get paid, and then do
Howard’s comment was a specific
reference to concrete contractors.
Almost everyone in the light-frame
industry has had to deal with a slab
up front of what the crucial elements
able on a specific project’s foundation, the company is motivated to do a
good job and get it right. The problem
is that the supplier of the framing pack-
All rights reserved.
JULY 2 0 2 1
5
age and the concrete contractor typi-
pre-approved framing package designs
CCA together before the next project
is identified and everyone is pointing
the ones who should be motivated to
to-framing issues. The outcome? No
cally only talk after a significant problem fingers and trying to figure out who’s
going to pay to fix the error. It’s not a
model for creating partners and fostering collaboration.
More importantly, who’s problem
is this really? It’s certainly not either the CM's or the framer’s problem.
Most likely it’s the builder’s or general contractor’s (GC) problem. Even if the
subcontractors and/or suppliers eat the costs of the repairs or adjustments and
the builder/GC doles out backcharges, the increases in cycle times and head-
aches associated with revised construction schedules and budget overruns
belong to the builder/GC. It is in their best interest to ensure foundation
errors that require adjustments to the
never happen in the first place. They are head this off at the pass.
The challenge is the builder/GC are
generalists, and it’s unlikely they fully
understand the magnitude of the problem, particularly if, for example, the
to talk through critical foundation-
more critical foundation errors. After
the meeting, the concrete contractor understood what it meant to “do a
good job” and was motivated to do so. The takeaway here is if you are
CM is in the regular practice of accom-
facing issues with another subcontrac-
when they initially got into provid-
plumbing, it’s critical to get the builder/
modating the errors. Howard said that ing the entire framing package (roof
trusses, wall panels and floor cassettes) and they ran into a foundation issue
on a specific project, they brought in
the builder and the builder concluded it was more cost effective to bring the
tor, whether it’s the foundation or the GC involved and explain why it’s in
their best interest to facilitate more
upfront communication between the
trades so everyone better understand what it means to do a good job.
concrete contractor back in to grind down a high spot in the foundation.
That painful experience prompted the builder to bring the contractor and
SEAN D. SHIELDS, Managing Editor
What came first? The building or the truss equipment inside it? As the only company in North America that designs and builds LBM facilities and rack systems nationwide, you can bet we know a thing or two about the unique challenges that face truss manufacturers. Unlike most facilities that you build first and put equipment in later, truss fabricators and other component manufacturers utilize equipment so large and complex that we design and construct the building around the equipment.
“The building needs to enhance the manufacturing process, not interfere with it.” Clint Darnell
VP National Accounts
If you need a building solution, from simple to complex, talk to CT Darnell.
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EXECUTIVE COMMITTEE
president’s message
President: Mike Ruede A-1 Roof Trusses • Fort Pierce, FL President-Elect/Treasurer: Gene Frogale Allied Systems • Winchester, VA Secretary: Jeff Taake Mead Lumber Co. • Columbus, NE Past President: Greg Griggs Builders FirstSource • Kennesaw, GA Roger Helgeson The Truss Company & Building Supply • Sumner, WA Joe Hikel Shelter Systems Limited • Westminster, MD Steve Stroder California TrusFrame • Perris, CA Scott Ward Southern Components, Inc. • Shreveport, LA AT-LARGE DIRECTORS Larry Dix Apex Truss • Warsaw, VA Barry Dixon True House • Jacksonville, FL Jim Finkenhoefer True House • Grayson, GA Jason Hikel Shelter Systems Limited • Westminster, MD Rick Parrino Plum Building Systems, LLC • Waukee, IA Ken Shifflett Quadd Building Systems • Remington, VA Jeff Smith Trussway Manufacturing, Inc. • Houston, TX Jason Ward California TrusFrame • Perris, CA DIRECTORS REPRESENTING CHAPTERS Dallas Austin Big C Lumber Truss & Panel • Dowagiac, MI Bill Blades Truss Fab, LLC • Glendale, AZ Greg Dahlstrom Villaume Industries, Inc. • Eagan, MN Howard Gauger Carpenter Contractors of America • Belvidere, IL Dave Green Carolina Structural Systems • Ether, NC Josh Hendrickson Wilson Lumber • Madison, AL BJ Louws Louws Truss • Ferndale, WA David Mitchell Engineered Building Design, L.C. • Washington, IA Justin Richardson Richco Structures • Sheboygan, WI Steve Strom The Truss Company & Building Supply • Eugene, OR Javan Yoder Stark Truss Company, Inc. • Canton, OH ASSOCIATE MEMBER DIRECTORS April Burt • Simpson Strong-Tie, Co. Jay Halteman • Wood Tech Systems, Inc. Michael Schwitter • Alpine, an ITW Company
Open for Business We are moving forward quickly, we want you to come along! DO YOU FEEL THE CHANGE
odology. We understand the building
evolving right before our eyes, whether
the framing, and we understand the
HAPPENING? The housing market is it’s the push to move more labor off-
site or the subtle shift from build-to-sell to build-to-rent. Our industry has been
design and the code, we understand
transportation and scheduling logistics. We have to be experts in it all!
So, if things are changing, it
bearing the brunt of raw material fluc-
doesn’t make any sense for us to be
is finally causing pain for everyone, and
and SBCA can help us do that.
tuations for decades, but this latest run it’s got the full attention of everyone
anywhere but at the forefront of it all, For too long, I feel as though the
in the supply chain. Katerra and their
association was not readily respond-
have failed, but they made clear there
held ourselves back. But no longer.
cash-burning disruption engine might is a big appetite to find a better way to construct buildings.
Who better to be at the forefront of
change than us? We are all in the business of creating and manufacturing
innovative, custom-made products on
every job. We are the most inspected,
scrutinized and regulated entity in the entire construction supply chain. We also have the most rigorous quality
control process governing our final
product. We are the one supplier to the builder who has always been heavily
invested in adopting the latest technology to enable the best framing meth-
ing to change. We may have even
We are now more focused on market development. Our team is refreshed and ready to tackle whatever chal-
lenge they encounter. We are open for business and want to work with
anyone and everyone in the supply chain to move our industry forward
and increase the market opportunities for every single component manufac-
turer and supplier to this industry. We
want to help you raise your game and become even more essential to your customer and be recognized as the
ultimate professional in the construction supply chain.
JULY 2 0 2 1
9
In my mind, this means we need to
help everyone be the best they can be. It means everyone should be send-
ing a jobsite package out with every
delivery. It means everyone should be participating in Digital QC and thirdparty QA. It means everyone should be utilizing all the industry-specific
best practices we’ve developed and honed over the years and become
manufacturers and suppliers going to
other LBM groups to ensure we are
and seeing all the technology they’re
with every one of our customers. We
the next LIGNA trade show in Germany developing for their markets. An event like that could be transformative if a critical mass captured those ideas,
brought them back here, and then
formulated a strategy on how to implement some of it in the U.S.
But we’re not waiting until the
expanding our lines of communication want to work with all of these groups
to educate our customers not only on
what we do so well now, but also what
innovative solutions we can provide for them going forward to address their biggest pain points.
If you want to be part of this trans-
SCORE-certified. It means everyone
LIGNA show in 2023 to start push-
formation, if you want to have a say in
their peers from the across the coun-
partnership with the Home Innovation
age you to take the next step. Come to
should attend BCMC to network with try, share ideas, and find solutions, all while checking out the latest equipment and services available to us. It also means we need to pursue the next step together.
We need to identify what our coun-
terparts in Europe and Australia are
doing. Imagine 150 U.S. component
ing forward. We are building a strong Research Labs (HIRL) in order to have
better market data for more informed strategic decisions. We are reach-
ing out to our customers within the
National Association of Homebuilders,
the direction we push, I want to encourBCMC in Omaha, Nebraska, October
4-8. It’s the easiest, most cost-effective
way to get engaged and share your perspective. I hope to see you there!
growing our National Framers Council membership, and building in-roads
with lumber-buying cooperatives and
MIKE RUEDE, SBCA President
THE NEW AND IMPROVED SBCA ACADEMY IS NOW HOSTED IN A USER-FRIENDLY LMS (LEARNING MANAGEMENT SYSTEM)
Members receive special pricing on SBCA’s vast collection of online training programs including: › Quality Control (QC) › Third-Party Quality Assurance (QA) › Truss Technician Training (TTT) › Operation Safety › Forklift Safety
PROVIDE TRAINING ANYTIME, ANYWHERE SBCACOMPONENTS.COM/EDUCATION 10
sbcacomponents.com
› Housekeeping › Risk and Liability Management (ORISK) › Truck Driver Training › Truss Manufacturer Orientation (TMO)
Smarter software was essential. That’s why Simpson Strong-Tie was essential. Marshall McCarty President, Automated Building Components North Baltimore, Ohio
hen Automated Building Components needed help achieving their business goals, Simpson Strong-Tie provided a winning solution. ABC wanted to maximize efficiencies with flexible software tools that allowed for better project tracking and customized reporting. Partnering with Simpson gave ABC the ability to share designs in real time across multiple truss plants and effectively manage projects from bid to delivery. With technology that’s more intuitive and robust, ABC can be more productive and can better sustain their business growth. And Simpson’s dedicated service and skilled support provide the expertise to help ensure ABC’s continued success.
W
Help your business reach its fullest potential. Partner with Simpson Strong-Tie today by visiting go.strongtie.com/ics or call (800) 999-5099.
© 2020 Simpson Strong-Tie Company Inc. ABCTRUSS3A
A BONUS FOR THE BONUS ROOM HERE’S AN ALTERNATIVE TO THE TRADITIONAL AT TIC TRUSS GETTING MORE FOR LESS. That
product in that category is the
seems to be the name of the game
attic roof truss. While still rely-
when it comes to homebuilding
ing on the triangle shape and
today. Whether you’re talking about
metal connector plates that define
the scarcity of jobsite labor, the cost
today’s roof truss, the attic truss
and availability of construction
strengthens the top and bottom
materials, or the shrinking size of
chords. It then shifts the interior
home lots and corresponding home
webs to create a large open area
footprints, homebuilders are looking
in the center that can be finished
space. This article is going to look at
for any solution that allows them to
off to create bonus square footage,
a solution Howard has developed for
offer the most house for the low-
in a home that would otherwise be
some of his builder customers and
est cost. This is certainly not a new
literal dead air.
explore some of its greatest benefits.
trend, but it is especially acute today
a lower cost is great, but Howard
Put a Floor in the Roof
levels of demand.
Gauger, engineering department
Simply put, what Howard suggests is
manager for Carpenter Contractors
instead of building a traditional attic
industry offers numerous fram-
of America (CCA), points out the tra-
truss, the floor of the bonus room
ing solutions that allow builders to
ditional attic trusses may not always
should be framed using a traditional
do more for less. One traditional
be the best way to provide that
floor design, and then the rest of the
The component manufacturing
12
Getting more square footage at
given the almost unprecedented
sbcacomponents.com
roof can be framed with separate
tive. Howard adds, “The open webs
conditions are also an important
smaller roof trusses.
also provide an optimal space to run
aspect to address. “If you’re going to
mechanical, electrical, and plumb-
add this bonus space within the roof
tant factors to consider is overall
“I think one of the most impor-
ing infrastructure.” The standard
envelope, you have to add the stairs
performance,” says Howard. “Just as
wall framing above would also allow
up to it,” says Howard. Adding or
you would with a traditional second
for typical electrical, insulation, and
stacking stairways is a logical way to
story of a house, you want the floor/
plumbing installation methods.
establish bearing, from one end of
ceiling diaphragm to have minimum
the floor trusses in the roof down to
deflection or bounce.” When possible,
Mind Your Bearings
using a floor truss for the floor fram-
When adding the bonus square foot-
For example, on a recent project
ing makes sense from this perspec-
age for a builder in this way, bearing
for one of Howard’s customers, the
the foundation.
JULY 2 0 2 1
13
Bonus Rm
initial plans didn’t specifically
Foyer
Hall
show any accommodation for square footage within the roof envelope (see figure 1). However, the customer was asking to add it using attic trusses. Howard looked at the plans and suggested adding a bonus room with minimal adjustments to the original plans (see figure 2). In this case, all it required was shifting two of the steel beams in the basement and making one of the bedroom walls bearing (see red circle locations in figures 1 and 2). “This is something I’ve done for multiple customers,” says Howard. “The best part is this approach minimizes deflection, is easy to ship, and can actually save the customer money because it can be constructed out of smaller-width materials that are easier to source.”
Foyer
Hall
Bottom Line Whether your customer is actively asking for a way to squeeze more square footage into their plans, a component manufacturer can actively differentiate themselves in the market if they get into the practice of exploring this option with their customers. Attic trusses have traditionally been the way to accomplish this task, but Howard offers up a strong alternative to consider that may end up being a more cost-effective, betterperforming option.
14
sbcacomponents.com
Basement
FIGURE 1
FIGURE 2
JULY 2 0 2 1
15
PEAKING
AT THE RIGHT TIME TCM’s journey in starting a new truss plant is full of insight
O
perating a successful component manufacturing operation in today’s build environment takes forethought, tenacity, and flat-out gritty determination. Imagine starting a truss plant from scratch, after what your own company has been through over the past six months. Whatever you can imagine, you’re probably just scratching the surface of what the leadership behind Summit Structural Systems has navigated as they got their new operation in Lincoln, Arkansas, up and running earlier this year.
Summit’s new facility supplies wood roof and floor trusses for a wide variety of projects, from large
post-frame buildings to sprawling multi-family projects.
16
sbcacomponents.com
“HAD WE KNOWN
turnkey framing operation
ence there was a lot to gain
a start-up manufacturing
WHAT WAS GOING
has had a growing portfo-
from converting tradition-
operation eliminates one of
TO HAPPEN WITH THE
lio of work and was buy-
ally stick-framed roofs and
the major challenges any
LUMBER MARKET THIS
ing more and more wood
walls in their market to
business faces. Another big
YEAR, WE MAY HAVE
roof and floor trusses from
component framing. “When
challenge is getting into a
CHANGED OUR PACE
multiple component manu-
it comes to the wood fram-
field you know little about.
JUST A BIT,” chuckles LD
facturers (CMs) for their
ing, our turnkey operations
“We had certainly worked
Harris, the driving force
projects.
can do a lot more volume
with a lot of manufacturers,
if everything is component
and we had certainly come
behind Summit’s creation.
“As we looked at the
“However, with just a few
trend lines and what we
months under our belt
were going to need in the
I am very excited about
future, we decided we
what we have been able to
wanted to control our own
accomplish and where we
destiny when it came to the
are headed.”
wood framing,” says LD.
Their journey to start
“We saw that not only will
a brand-new operation is
we need more wood roof
instructive to everyone in
and floor trusses, but there
the industry in that it pro-
will be plenty of new busi-
vides a unique perspective
ness in our region to sup-
on what it takes to enter
port the additional capacity
the industry, what needs
Summit brings.”
to be considered, and most
In other words, TCM got
importantly, who you can
into the game not because
turn to for help.
they didn’t like the prod-
Understand the Need
"WHEN IT COMES TO THE WOOD FRAMING, OUR TURNKEY OPERATIONS CAN DO A LOT MORE VOLUME IF EVERYTHING IS COMPONENT FRAMING. THE MATERIAL AND CYCLE TIME SAVINGS ALLOW US TO TAKE ON EVEN MORE PROJECTS.” — L D H A RRIS
uct they were getting from other CMs, but because they
LD is the vice president
knew the long lead times
framing,” says LD. “The
to appreciate what we liked
of operations for TCM
they were already dealing
material and cycle time
most about the roof and
Enterprises, one of the
with were only going to get
savings allow us to take on
floor trusses, but we knew
region’s fastest-growing
worse. Further, LD and the
even more projects.”
we had a lot to learn about
commercial metal and wood
rest of the TCM leadership
framing contractors. Their
had learned from experi-
Certainly, bringing a large book of business to
how to actually fabricate them ourselves,” says LD.
JULY 2 0 2 1
17
Gather All the Data
ITW Company, “I was excited
ing through the facilities,
of thoughts on our initial
Neither LD, nor TCM’s
about what LD and his crew
LD peppered everyone with
approach,” says LD.
founder Jon Tuggle, had
wanted to accomplish,” says
questions ranging from
any background in the truss
Dustin. “They didn’t want to
material throughput to best
at several operations, LD
industry. They are contrac-
take business from anyone,
practices for handling, stor-
developed a set of pro forma
tors by trade. “So we did
they wanted to convert proj-
age, and transportation.
financials, or forecasts, to
some analysis,” says LD.
ects and grow capacity for the
“A lot of analysis. Both on
future growth they knew was
and Dustin’s expertise,
operation they should build.
what we could learn on the
going to happen. I wanted to
I learned a lot about the
“Dustin was an incredible
type and volume of work
help them in any way I could.”
industry and got answers
resource, he was incredibly
Dustin started by con-
to important questions I
helpful in figuring out the
that was coming to the area
“Between all the tours
After taking a hard look
determine the size of the
through national builders
necting LD with several
wouldn’t have necessarily
ROIs on all the investments
and other developers, and
CMs. “There’s no better
known to ask,” says LD. The
we had to make.”
then we learned as much as
way to learn the business
plant tour that sealed the
we could about how differ-
than to walk through the
deal in LD’s mind was with
Make the Leap
ent component manufactur-
operations of others and ask
Donnie and Bo Powers at
One of the main things LD
ers (CMs) provide product
them a million questions,”
Panel Truss in Henderson,
focused on in all his tours
for that type of work.”
says Dustin. So LD and his
Texas. “They were so open
was figuring out how much
Early in this process, LD
team went on a whirlwind
and helpful, and hearing
physical space and produc-
met Dustin Johnson, district
tour of several CMs across
all their lessons learned on
tion equipment they would
sales manager for Alpine, an
the country. While walk-
equipment solidified a lot
need to produce the volume
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they had in mind. “We were
pulling out all the stops to
looking in several locations
finish what should have
throughout the region and
been a six-month rehab
then a building just fell
project in a little over two
in our laps,” says LD. The
months. The biggest hold-
former Sunny Fresh egg
up on the whole renovation
plant in Lincoln, Arkansas,
was installation of new elec-
became available at the right
tricity infrastructure. “We
price. “The building was in
were actually able to install
rough shape, but it fit our
all the machinery without
needs and we were able to
any power in the build-
move in and start renovat-
ing,” says LD. “Everyone at
ing it immediately,” says LD.
Alpine provided excellent
In addition, TCM was able
customer service, and in the
to purchase ten additional
end the lack of electricity
acres of land right across
only set us back a couple of
the street to enable future
days. It was amazing.”
expansion.
Summit’s facility is ini-
TCM’s crew completed a six-month rehab in two months, and equipment was installed even before the power was turned on.
mitted to producing wall
TCM’s needs, we’ve had
tially set up to produce roof
panels too, likely adding
several of our customers ask
set to work renovating the
and floor trusses, but LD
that product line in the not-
us to make wall panels, so
40,000 square-foot facility,
says the company is com-
too-distant future. “Beyond
we know the need is there,”
The TCM team quickly
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19
Summit utilizes the
latest technology to facilitate the most
efficient and accurate
production possible.
who helped us understand
scarce, and all those early
component manufactur-
forecasts suddenly looked too
ing, were instrumental in
optimistic. “I’m proud of how
connecting us with people
this team has handled all that
throughout the industry
adversity,” says LD. “Five
and help us identify expe-
months in and we are really
rienced people we could
surging ahead with a bright
bring in right away,” says
future ahead.”
LD. To that end, Summit boasts on their website they
Bottom Line
already have over 100 years
Whether you’re looking to
of truss industry experi-
launch a whole new opera-
ence employed to help cus-
tion like Summit, or simply
tomers, whether it's for a
looking to expand your
commercial, single-family,
current operations, TCM’s
multi-family, or agricultural
journey is instructive. First,
building.
gather as much informa-
All of that experience was
tion about future needs as
put to the test early as equip-
you possibly can. Next, find
ment was installed the first
a partner like Alpine who
week of January 2021, and
can connect you with other
the first trusses were loaded
component manufacturers
says LD. “We know that
Build the Team
wall panels are tough to do
The other big challenge was
onto new roll-off trailers
to learn from. Finally, make
right, so we’re going to get
assembling a top-tier team
bound for a jobsite by the
sure you’re assembling the
a few quarters of experience
to get Summit off the ground
fourth week of January. Then
right team to get the most
under our belt and ease into
and be successful out of the
the lumber and steel markets
out of the capacity you bring
it slowly.”
gate. “Our initial contacts,
erupted, material became
on line.
20
sbcacomponents.com
“For 40+ years we have trusted the Alpine name. Strong technical support, powerful software, and reliable equipment— our family has confidence in Alpine!” — Chase Barineau
Vice-President Seminole Trusses, Inc.
Alpine has it all—the right equipment, user-friendly software, dependable hardware, and the service, support, and training to make your team as efficient as they can be. And Alpine delivers the complete package for success—including the extra effort in comprehensive support that sets us apart within our industry.
Ask those who know. They’ll tell you about the people at Alpine who make a difference.
BUSINESS & DESIGN SOFTWARE | CONNECTOR PLATES EQUIPMENT | ENGINEERING SERVICES & SUPPORT
Connecting for the Future Call 800-521-9790 or visit www.alpineitw.com for complete information
A RECIPE FOR AVOIDING DISASTER Here are the proven ingredients to manage workers’ compensation insurance costs.
MY WIFE IS A GREAT COOK who has amassed a giant notebook full of delicious recipes. One of the reasons her food is so good is because she follows these recipes closely. I’m particularly fond of her English toffee. It’s exquisite, however, this recipe requires attention to detail and diligence (execution of each step in the process). Similarly, this article will share a proven recipe to lower your workers’ compensation insurance costs (and improve productivity) that will yield sweet results if followed diligently. This recipe contains ten ingredients, all of which should be analyzed and diligently added to your overall efforts.
22
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INGREDIENT:
Review Current Processes, Procedures, and Results
INGREDIENT:
Commitment by Management DIRECTIONS:
DIRECTIONS:
Management commitment is an essential
Successfully following a recipe starts with
ingredient. Management support and
gathering all the needed ingredients and
engagement, recognized by all employees,
understanding the process by which they will
will allow your safety-focused initiatives to
be combined. You can do this in your facility
move forward and deliver positive results.
by first asking and answering the following
The steps to gain management buy-in are:
questions:
• Determine what metric is important
• What safety programs and training do we have in place?
to management.
• One useful metric is the workers’
• How often do we conduct plant safety
compensation cost per full-time equivalent
How do we measure effectiveness?
workers’ compensation costs for 100 FTEs
inspections? Are they effective?
• What do our injury and illness reporting forms look like? Who is accountable for completing them?
• How do you ensure claims are reported immediately and accurately?
• How comprehensive is our transitional
(FTE) employee. For example: If your
is $200,000, then your cost per FTE is
$2,000. Measure this metric each year to
help monitor cost trending and even cost per division within your company.
• Define the financial impact of a single claim, fully considering direct and indirect costs.
employee medical restrictions from the treating physician and following them?
INGREDIENT:
Train Supervisors DIRECTIONS:
INGREDIENT:
Review Return-To-Work Policy
Supervisors must clearly understand how to respond to injuries, as this response sets the tone for the claim outcome. Essential
DIRECTIONS: Look over your return-to-work (RTW) policy to ensure transitional duty is clearly outlined as: • Temporary, lasting no longer than 90 days. • Similar in the shift and hours worked with the employee’s current job.
• Containing no overtime. • Compliant with the Americans with Disabilities Act.
• Required as a condition of employment.
a lot of essential ingredients and they all take
duty policy?
• What is your process for obtaining
There are
a lot of care and dedication to create, implement, and evaluate
ingredients in supervisor training should
in order
involve the following components:
to ensure the
• Understanding the benefits, processes,
and procedures involved in filing workers’
result is a success
compensation insurance claims and being able to explain them to an injured worker. • Knowing the appropriate post-injury response.
• Determining the most appropriate transitional duty to fit any physical restrictions.
• Understanding how communication on
a personal level with an injured worker is essential to positive outcomes.
JULY 2 0 2 1
23
• Provides a work environment where injured
INGREDIENT:
employees are encouraged to report the inju-
Hire the Right People
ry, and in return receive piece of mind, medi-
cal guidance on steps to self-treat the injury or
assistance in seeking further medical attention.
DIRECTIONS: Obviously, if you hire people well-suited for the work they are asked to perform, chances of injury and even some illnesses are reduced significantly. In your hiring
INGREDIENT:
Obtain Proper Medical Care
practices, make sure you: • Review your job descriptions, your employment application, and interview process.
• Conduct thorough background checks. • Perform post-job medical, physical strength, and mobility evaluations.
If you hire people well-suited for the work they are asked to
• Administer personality, cognitive, and/or
integrity tests to gather baseline information on new hires.
• Review initial training and onboarding
procedures to ensure they are effective at preparing new hires to perform their
perform, chances
assigned tasks. If they are assigned new
of injury and even
the process by which they are trained.
and/or additional tasks after hire, review
some illnesses are reduced significantly.
and proper medical care to address a specific injury has a significant impact on any workers’ compensation insurance claim and the employees’ road to a full recovery. As such, ensure you: • Have access to highly qualified doctors and/ or medical facilities in order to treat injured employees during all business hours for all business locations.
• Have the ability to provide immediate
transportation to the medical facility for
an injured employee, in the event medical able or cannot arrive in a timely manner.
INGREDIENT:
Responding to Injuries
INGREDIENT:
Manage Claim Handling
Company and co-worker response in the initial moments after an injury occurs
DIRECTIONS:
heavily determines the outcome of the
In managing a claim, there are a few
claim. Having a consistent post-injury
important steps to take:
procedure dramatically improves results.
• Discuss claims handling options and
To that end, ensure your company: • Is committed to providing timely incident
reporting. Studies suggest the best outcomes occur when an injury is reported within 24 hours of the injury.
• Is prepared to
provide on-site
injury triage.
sbcacomponents.com
It should go without saying that sufficient
emergency transportation is either not avail-
DIRECTIONS:
24
DIRECTIONS:
expectations with your insurance broker, insurance claims adjuster, or third-party claims administrator.
• Communicate with an injured employee
weekly, at a minimum, to check on the injury, their health and well-being, and to express concern.
• Obtain regular claim status reports throughout the claims process.
description of the work environment at the
INGREDIENT:
Consistent Claims Investigations
time of the injury.
• A review of any prior injuries, accidents,
and/or relevant medical records that might provide context to the severity and impact
DIRECTIONS: Post-injury investigations are also an
of the current injury.
important ingredient that impact workers’ compensation insurance costs. To be effective, these investigations should include: • Injured workers’ essential information,
INGREDIENT:
Communication
which must include name, date of birth,
Social Security number, and wage should be completely documented.
• Thorough details concerning the injury,
DIRECTIONS: When it comes to injuries and illness, it’s very
not simply “injury to shoulder”. Include the
important to establish employee expectations
aspect of an injury. Also include a thorough
filing, and returning to work. Your employee
what, where, why, and how regarding every
regarding injury and illness reporting, claim
When it comes to injuries
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it's very important
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and illness,
engineered for durability and high output
to establish
Feed Limit Switch
employee
monitors material for efficient feeding
expectations regarding injury and illness reporting, claim filing, Oversized Drive Motor
to ensure more than adequate power
Multiple Infeed Rollers
are independent to ensure correct feeding
and returning to work.
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Supervisors must clearly
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understand how to respond to injuries, as this response sets the tone for the claim outcome.
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handbook should include the following:
Bottom Line
• A thorough description of what workers’ com-
That’s the recipe for controlling your
pensation insurance is and what it covers.
• How to report injuries and illnesses to
supervisors and, if necessary, obtain medical treatment.
• How employees will be paid if they miss work due to an injury or illness.
• A thorough explanation of the company’s RTW policy.
• A clear statement that the company wants
to support each employee throughout their full recovery and the desire that they can come back to
their job at the company.
26
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12/14/2020 2:07:21 PM
workers’ compensation insurance costs. There are a lot of essential ingredients, and they all take a lot of care and dedication to create, implement, and evaluate in order to ensure the result is a success. If you would like further guidance on any of these steps, or if you simply have questions, please feel free to contact me at rlangton@bowermaster.com.
Rich Langton at Bowermaster & Associates is an SBCA endorsed insurance broker who has worked with the component manufacturing industry for 21 years.
OMAHA, NEBRASKA | OCTOBER 4–8, 2021
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27
To Whom are You Referring?
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sbcacomponents.com
INCENTIVIZE YOUR CURRENT EMPLOYEES TO HELP YOU FIND YOUR FUTURE TEAM
IF YOU ARE PULLING OUT ALL THE
Ward, CTF’s VP HR, including EHS,
FOR EMPLOYMENT, one of your most
hiring practices. It’s not just going
STOPS TO FIND GOOD CANDIDATES
Risk, Legal, and QC. “It’s our standard
effective tools in the hunt for talent
through the interview. We don’t just take
is already in your back pocket: your
anyone who can swing a hammer.”
current employees. A well-designed
Clearly define and share with
employee referral program can help you
employees the knowledge, skills, appli-
put this tool to work in solving your cur-
cable work history, behavioral require-
rent workforce shortage.
ments, competencies, education, etc.
A recent SBCA survey of production
required for a given position. When
employees found that a referral by a
a candidate doesn’t work out, let the
friend or family member was the prin-
referring employee know why a referral
cipal entry into the industry (53.9 per-
wasn’t a fit, so they aren’t discouraged
cent). In order to maximize the effective-
from referring other folks in the future.
ness of an employee-referral program,
For example, beyond basic skills
employers need to ensure the program
requirements, you might also say your
is well-publicized internally, easy for
company is looking for “team players
employees to participate, and is
who can handle repetitive tasks without
backed by an incentive structure that
becoming frustrated,” which are behav-
actually entices participation.
ioral requirements that you’ll need to
Have a Clear Policy
measure via an assessment system. In the interview, have ready standardized
For example, California TrusFrame
questions around essential competencies
(CTF) accepts referrals for its job roles,
such as discipline, integrity, work pace,
including Class A drivers, designers,
and other qualities required for success
stackers, framers, and forklift opera-
on the job.
tors. The CTF incentive program clearly states referring employees receive $200
Put It Into Practice
for candidates with no experience, and
Thomas Oliphant, Sawyer 2, has been
$400 for those with experience, and new
with CTF for five years. He has referred
hires get $200 after 90 days on the job.
four employees during his tenure with
It’s also important to state that an
the company. “Just this past Sunday
employee referring a candidate doesn’t
I was telling a few other people about
mean they are automatically hired.
some openings at CTF and said they
Rather, every referral is still evalu-
should come to apply,” he said. “I
ated on the same criteria as all other
referred them because they told me that
candidates. “We get a large amount of
they were looking for a job. I also know
application referrals, but some of our
that we have a referral program, so the
employees get upset because we’re very
bonus was a plus.”
selective with who we hire and a lot of people don’t make the cut,” said Jason
Andrea Ward, CTF’s HR generalist, has also referred candidates to the
JULY 2 0 2 1
29
company. “If I didn’t like working here,
The guy was so excited, he would bring
through regular communication includ-
I would not refer others, but I do, and I
the tools to work to show everyone,
ing message boards, payroll notices, fli-
have referred five other employees,” she
which had a peer-focused social influence
ers, and discussions with the manager
said. “I know that for the yard it is very
that led to more referrals.”
when they have their regular staff meet-
hard work, and it may not be for every-
Because employees who referred new
ings. At CTF, managers are regularly
one, but those that make it past the first
possible hires were automatically entered
prompted to remind workers about the
few weeks are very good workers and are
into the drawing, it was easy to get more
program, and to post fliers throughout
here for the long haul.”
participation. To sweeten the deal, they
the facility explaining the program with a
also received a $500 referral bonus if the
list of positions currently needed.
For example, Andrea referred Lucero Alvarez, who was hired in August 2020.
new employee worked through 90 days.
“I’ve already told others that they should
“That was very successful, and it was
apply,” he said. “I enjoy working at CTF.
more sustainable because of the vendor
There is room for growth and the other
sponsors,” said Northway.
employees are very friendly. I know there is plenty of work, and overtime too.” The growth Alvarez is referring to
& Sons, Inc.’s employee referral incentive program is structured so that if the
is the number of career paths CTF has
referred person is hired, after 90 days,
created and promoted to its employee
the employee who made the referral gets
base. “A sawyer is not just a sawyer,” said
$200; after a full year, that person gets
Jason. “You have Sawyer 1, 2, 3, senior.
an additional $300.
They have a path. And each level has a
24% I DON'T KNOW
As another example, H.M. Stauffer
58% YES
18% NO
“A number of people make it through
pay band that goes with it and the job
the first 90 days; that’s not too high a
descriptions, so they know what they
bar, but there’s only been a few that
need to go the next level. We created that
made it the whole year,” said Keith Bare,
system companywide for all positions.”
purchasing manager with H.M. Stauffer & Sons, Inc. “We have been doing this for
DOES THE COMPANY YOU WORK FOR HAVE AN INCENTIVE PLAN FOR REFERRING OTHERS?
Customize Your Approach
five years. But in light of the current hir-
There are many ways to design an
ing challenges, in March, we went around
Bottom Line
employee referral program. Ideally, you’ll
and reviewed the program with the
Your current employees may very well be
want to get input from an HR profession-
managers so they could talk about it with
your best source for future employees.
al. Many employers offer some sort of
the employees that we have this existing
Motivating them to help you fill your
cash bonus (e.g., $200 after the referred
$500 incentive program. And we had a
workforce vacancies is all about having
candidate stays on the job for 90 days),
recent success. I was just told that we
a clear employee referral program with
but you can offer other incentives like gift
just hired a new maintenance employee
incentives that truly motivate them to
cards for PPE, restaurants or entertain-
through this program.”
encourage others to apply. Once you have
ment, or an extra day off with pay, or a
a program in place, make sure to pro-
drawing for prizes like company swag or
Constantly Promote It
mote it to your employees on a regular
the latest electronic gadget.
The SBCA study of production employees
basis so it remains fresh in their minds
A previous employer of Larry
mentioned earlier also found that while
as they interact with their family, friends,
Northway took this approach. “If you
57.7 percent of respondents knew about
and acquaintances outside of work.
brought someone in the door, you were
their company’s current employee incen-
entered into a drawing once a quarter,
tive program, 18.4 percent worked for
and that was for a $1,000 gift card that a
companies that didn’t have a referral pro-
vendor sometimes even sponsored,” said
gram. Most surprising was that 23.9 per-
Northway, who is now production man-
cent weren’t sure whether their employer
ager with Engineered Building Design.
had such a program, if one even existed.
“One guy won and was able to purchase all new construction tools for his home.
30
sbcacomponents.com
This means if you have a program in place, make sure to promote it frequently
Dolly Penland, President & CEO of Business
Results, a PI® and CATIL Certified Partner and Talent Optimization consultancy, works with
organizations to help them hire and manage their talent to their highest potential. She specializes
in multiple areas including business sales growth, turnover reduction, and leadership development.
OMAHA, NEBRASKA | OCTOBER 4–8, 2021
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