Can you feel it? Astute wall and ceiling contractors can. It’s coming as sure as death and taxes, and it’s right around the corner. Whether it will be a full-blown recession or a “soft landing” remains to be seen, but with the Fed raising interest rates by degrees, the construction industry is one of the coal mine canaries that suffers the pinch first. The early effects are being felt in some regions already: skyrocketing material prices are beginning to cool, and labor shortages are rapidly subsiding. Estimators are starting to see the flow of invitations to bid dwindling to a trickle. These are mere symptoms of a larger economic ailment—that is, a dramatic if not drastic drop in demand for new construction. The question is, how do shrewd wall/ceiling contractors cope in lean times, such as we anticipate?
I have observed a few of these dips come and go, and I’ve taken note of some strategies I’ve seen smart drywall subs employ. One of these clever tactics seems a bit counterintuitive as a fit for hard times, but surprisingly, it appears to have worked more often than not. One way to maintain a healthy level of volume as fewer opportunities are offered is to broaden scope. A number of construction services run complementary to commercial framing and drywall, some of which are pretty easily added to a sub’s performance. For instance, painting, ACT, caulking and insulation present few barriers to entry, and the addition of one or more of them should be seriously considered as a potential remedy for a shrinking backlog. Aside from the bundling effect making the bid package more attractive to the GC, the added volume helps to prop up a sagging backlog.
Of the services mentioned above, the advantages to adding paint to the mix are a no-brainer. Just in terms of interior finish, the edge one gets with performing the entire finish installation quickly becomes evident: control gained on schedule, sequence and quality assurance. From something as critical as determining the volume of work to be readied for a work cycle to something as simple as sharing masking efforts, the positive cost effects emerge. But we need to broaden our thinking if we narrowly conceive that paint simply follows drywall. Aside from the typical painting of fixtures (pipes, ductwork, decks) that adhere to most commercial drywall projects, there are the stand-alone paint projects that add further justification for opening a paint department in one’s approach. Parking garages, infrastructure projects and industrial facilities are examples of paint-only projects that have the potential for good profit.
So we can agree that adding paint to a commercial drywaller’s repertoire makes for a good defense against a shrinking backlog. But as with most strategies, there is a cost. Painting is not just a matter of covering the drywall. There are many aspects to painting that require an unanticipated level of sophistication. A typical commercial project demands extensive work in areas such as site and roof (site walls, gates, bollards, light-pole bases, screen walls) that demand the expertise of a specialist. I strongly suggest to any commercial drywall contractor who is considering adding paint to the scope, to include adding some overhead in the way of a qualified paint estimator who knows the ropes. Specialty coatings, wall covering and site work are all paint items that could easily stump an unassuming drywall estimator. Obviously, number one on the list for adding a paint department would be adding a paint estimator.
Adding acoustical ceilings to a commercial drywall program comes with similar advantages and similar drawbacks to adding paint. At first glance, a framing/drywall estimator sees a simple area condition that can be taken off with ease. But an acquired knowledge of a bazillion different tile types by several manufacturers is necessary to complete an informed estimate of a grid ceiling (most drywall estimators are astounded at the vast differences in tile pricing). This prerequisite is in addition to needing a comfortable familiarity with a number of specialty ceilings. Add seismic details to the mix, and one meets a level of sophistication that clearly should be placed in the hands of a specialist bidmeister.
These days, on commercial jobs, even such seemingly simple operations as insulation and caulking (especially fire caulking and EIFS caulking) have become much more intricate in their evolved specifications than is generally assumed. Again, taking on this added scope might mean taking on an added estimator.
It seems apparent that, while I’ve advocated adding scope to a commercial drywaller’s performance, I’ve also cited a serious obstacle by recommending the addition of some costly overhead in the form of an added estimator. The best way to sidestep this extra cost is to consider subbing this added scope to a second-tier subcontractor who has the background knowledge to bid that supplemental work accurately and competitively.
In any case, my advice is to look for ways to weather the coming storm with such tactics as bundling. And buckle up—it’s going to be a rough ride.
Vince Bailey is an estimator/project manager in the Phoenix area.
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