After several years of stagnation, the precast concrete industry is turning the corner in recovery from the Great Recession, with the National Precast Concrete Association 2013 Benchmarking Report indicating 2 percent higher volume over the prior year.
The 2013 Benchmarking Report is available to association members for $250 ($300 nonmembers) through the association bookstore at www.precast.org.
“The growth in the precast sector typically trails the rest of the construction industry by about a year,” says NPCA President Ty Gable. “Based on history and anecdotal evidence from the first half of 2013, we are confident that the upward trend is continuing in 2013. But we’ve still got a long way to go, and we won’t see sales volume that approaches the peak years of 2006 and 2007 any time soon.”
NPCA’s Benchmarking Report is compiled from a voluntary annual survey of North American precast producers. Conducted by Industry Insights, an independent research firm based in Ohio, it includes sales mix data, profit model ratios, and compensation and benefits summaries from participating companies. The 2013 survey reflects results from 75 precast concrete producers operating 181 plants.
Gable said that during the recession, the precast concrete sector lost about 40 percent of its sales volume from a 2007 peak, and is now at a level similar to the industry’s size in 2000. The number of companies has also declined from its peak. NPCA estimates that there are about 2,800 precast concrete companies in North America, which is about 20 percent fewer than six years ago. “We’re recovering, but still face challenging times,” Gable affirms. “Based on what we’ve seen so far in 2013, we would expect about 4 percent growth this year, so the trend is in the right direction and we see a lot of opportunity ahead in new technologies and emerging markets for precast.”
Among key findings from the 2013 NPCA Benchmarking Report, reflecting a survey of 2012 precast production and shipments:
The precast concrete sector grew by about 2 percent in sales volume last year to $15.4 billion.
The sales volume of the septic tank sector grew by 14 percent, which follows the recovery of the housing market.
The building products sector increased by 9 percent, which includes categories such as architectural wall panels, a comparatively small but growing line of business. Growth of 30 percent in the sector indicates that specifiers are increasingly selecting precast concrete panels for new building designs.
The traditional core categories of sanitary, wastewater, transportation and utility products remained steady.
Profit margin increased from 2.5 percent to 4.9 percent, which is still below average but gets closer to levels that are historically more normal.
NPCA ADDRESSES FRAUDULENT USE OF CERTIFIED PLANT LOGO
Responding to member complaints, the National Precast Concrete Association Quality Assurance Committee is cracking down on inappropriate NPCA Certified Plant logo use and posting a related addendum to the Quality Control Manual for Precast and Prestressed Concrete Plants:
In the event that NPCA becomes aware of evidence that the Certification seal, emblem, logo, or other symbol of or reference to certification is being used by an unauthorized person or organization, NPCA shall ask its General Counsel to assess whether the evidence is sufficient to issue a letter instructing the misappropriating person to cease and desist from the misappropriation. If the evidence is deemed sufficient, the General Counsel shall issue a letter to the misappropriating person based upon one of the templates attached hereto, selecting the template in accordance with whether the misappropriating person is an applicant or member of the Certification Program, or not involved in the program.
If the evidence is not deemed sufficient for a “cease and desist” letter, the President may issue a letter to the misappropriating person expressing NPCA’s concern and asking for an assurance that symbols and references to certification are not being misused. If the misappropriating person continues in the misconduct, the President shall take such action as is deemed necessary to protect the integrity of the Certification Program, including without limitation further oral and written contacts with the misappropriating person, suspension of membership in NPCA, and appropriate remedies through legal action, including litigation to obtain a cease and desist order and/or monetary damages. Further, NPCA shall seek the court’s order that the Plant shall reimburse NPCA for all expenses incurred in obtaining judicial relief.
The committee seeks to curtail producers’ use of the logo before passing the certification inspection or continuing to use the logo after withdrawing from the program. The logo is a legally registered service mark for plants that are in good standing. Use of the logo when a producer or plant is not certified represents a fraudulent act, notes NPCA QA Committee Chairman Richard Alvarado. “We take it very seriously because it’s basically a lie,” he adds. “If you are lying to get work where certification is a requirement, then you are unfairly competing against properly certified plants. It’s an unfair business practice.”
Reports of instances of inappropriate NPCA Certified Plant logo use can be directed to NPCA Director of Technical Services and Plant Certification Phillip Cutler, P.E., [email protected]