Contractors and framers alike have been skeptical about using components for their jobs. Here we discuss some of the reasons and reactions for choosing pre-built components over traditional stick building. The following article was featured in Structural Building Components Magazine: January/February 2005.
A Closer Look at Wall Panel Manufacturing
Publisher's Message: Right Time for a Change!
By SBC staff
“ Nothing endures but change. ”
- Heraclitus (540 BC - 480 BC)
Happy New Year! There is no time like the beginning of a new calendar year to consider making a few changes. For SBC Magazine , it means introducing some modifications to our editorial calendar for 2005. The New Year holds some exciting plans for fresh editorial topics, original features and a renewed commitment to bringing you more information on the leading-edge issues affecting the structural building components industry.
Let's start with the issue you hold in your hands: the first issue in SBC's history to focus on Wall Panel Manufacturing! When it comes to considering change, wall panel manufacturing has been the industry's hot topic for the past few years. According to information provided by members, more than 25 percent of the Wood Truss Council of America (WTCA) membership currently manufactures wall panels, and it seems more people are considering getting into wall panel manufacturing every day. Feedback from attendees of the Building Component Manufacturers Conference (BCMC) has shown that this is a topic of great interest; and suppliers of wall panel manufacturing equipment reported heavy traffic at the 2004 show in Charlotte.
We delve into this topic by looking at wall panel manufacturing from a few different angles. Our anchor article begins by taking you through what some in the industry have called “the most automated wall panel manufacturing plant in the country,” as we explore the operations of Advanced Building & Components in Mead, NE. In addition to exploring the height of automation, we visit a day in the life of one relatively new wall panel manufacturer and outline what to consider for those just breaking into this business line.
This issue is also home to Part 2 of our series on “Transporting Trusses.” Building off of the general introduction to navigating regulations and enforcement provided in the December 2004 issue, this installment will take a more specific look at questions of size, weight and reducible load.
As for the columns in this issue, one of your favorites returns under a new name. WTCA Legal Counsel Kent Pagel is an expert at tackling the daily legal issues facing wall, truss and component manufacturers. On this occasion, he discusses truss collapse investigations in Legal Edge.
Finally, SBC staff wants to remind you of our theme for the year: “ Your Industry, Your Magazine, Your Ideas.” This publication exists to serve your needs and deliver the information you need to help you run a successful business. Don't hesitate to contact a member of our staff with your comments, questions and article ideas. We look forward to hearing from you and to bringing you another nine quality issues of SBC Magazine in 2005!
Reprinted with the permission Truss Publications, Inc. from Structural Building Components Magazine, January/February 2005 , p. 10. Copyright © 2005 by Truss Publications, Inc. For more information visit www.sbcmag.info or WTCA's web site, www.woodtruss.com .
The following article was published in ProSales Magazine, January 2005.
Component Craze
By Rich Binsacca
Once a high-risk, untested alternative to stick-framing, components are now near-necessities to many a builder’s—and dealer’s—profitability.
Even if you could find it on a map, Mead, Neb., (pop. 564) is probably the last place you’d think of as a poster town for factory-built framing components. But it’s where Randy Johansen, a former stick-framer, now operates a state-of-the-art, 41,000-square-foot wall panel plant and has a 32,000-square-foot truss facility about to come on line. “We started building them at the lumberyard for one customer and it evolved into this,” says Johansen, president of Advanced Building & Components, Inc.
He’s not alone, of course. The last time the Wood Truss Council of America (WTCA) surveyed its membership, in 2002, there were nearly 1,700 truss and/or panel manufacturers operating nationwide, most of them single operations—an industry that sells in excess of $9 billion worth of components for residential and commercial construction projects. In addition, two-thirds of the pro dealers listed on the 2004 ProSales 100 now have manufacturing capabilities, with roof truss, wall panel, and floor truss lines growing the fastest of any category.
Even in Texas, perhaps the country’s last large-scale bastion of predominantly stick-framed single-family houses, high-volume home builders are following their commercial and multifamily counterparts in demanding roof trusses, while most of their peers in states such as Florida simply won’t use anything else. And it’s not just a tract-builder phenomenon: There are no big names like KB Home or Centex operating in Mead’s service areas of Lincoln, Omaha, and Fremont, Neb., for instance, yet the market supports four component suppliers, a trend initiated by Johansen. “There’s broad-based demand [for components],” says Kirk Grundahl, P.E., executive director of the WTCA in Madison, WI.“The demand is not by the type of builder, but among builders who are breaking with traditional practices driven by their desire to develop land as quickly as possible.”
If you want to know why components have quickly evolved from novelties to necessities among builders, and thus offer dealers a key survival tool against threats to their value in the supply chain, consider these key reasons:
Reason #1: Builders Don’t Build
For better or for worse, few home builders constructing more than a couple of custom houses a year are “builders” in the traditional, pounding-nails sense of the word. “Today’s production builders are land developers,” says Casey Carey, operations manager at Davidson Industries in Franklin, IN, a single-location operation that manufactures trusses and wall panels within a vast inventory of LBM products and services for the Indianapolis market. “Their biggest challenge is [turning] land and they need houses to put on it.”
That shift has put the burden on others, namely framing contractors and increasingly lumber dealers, to provide as much of the actual house as possible, and quickly. “Our systems can produce a house in 11 days, but sometimes that’s not fast enough,” says Carey, whose customers have asked Davidson Industries to go from blueprints to a house on site in as few as seven days.That’s certainly faster than any stick-framing crew—assuming a builder could find one, much less several such crews, to meet his production demands. “Builders need to keep on schedule and get houses up,” says Johansen, whose framing business now exclusively installs components as a turnkey operation. “They like panels and trusses because they can pinpoint how long it takes to frame each house.”
Component suppliers, especially those offering installation, not only assume much of the burden of building, but also relieve their builder customers of other issues that can hinder their ability to turn raw land into valuable real estate. “We take care of allhis problems,” says Johansen, including engineering the blueprints, conducting materials takeoffs, and managing returns. “Once we have them hooked [on components and
turnkey framing], they don’t go back to sticks.”
Reason #2: Components Cost Less
Tired of trying to market theories and anecdotal data about the cost savings afforded by component framing, the WTCA teamed with NAHB’s Building Systems Council a few years ago to construct two identical, 2,600-square-foot single-family homes, one with sticks and the other with trusses and wall panels.
The component-built house went up in about one-third the time as the other unit, reducing labor costs by $4,560, while also trimming $325 in waste-disposal charges. Despite a 10 percent materials premium, the bottom line was a $3,356 savings, an 18 percent difference, for the largest-ticket item in a builder’s construction budget (see “Proof Positive,” left). Put another way, a builder can count on framing three component-built houses for every stick-built house. “If a builder can turn more houses with the same labor, they can
turn land faster,” says Don Groom, vice president of operations for Stark Truss in Canton, Ohio, which operates 15 component facilities in seven states. And in builder lingo, land is money.
Even if components do cost more than the same number of sticks required to build a comparable house, Johansen doesn’t charge a premium for them. “Our job is to make panels more convenient [to build with] and to save soft costs,” such as waste and theft loss, he says.
Profits at Advanced Building & Components instead come from producing and often installing hassle-free components (which reduces callbacks and returns), as well as materials handling efficiencies in the factory and labor savings achieved by the company’s turnkey framing business. “You have to work your tail off to be efficient in this business,” Johansen says.
Reason #3: Components Support Diversity
Thanks to faster and more precise production equipment that can engineer components to almost any building design and deliver them on schedule, component suppliers can meet increasing demand for trusses and wall panels for single-family, multifamily, and light commercial projects. “We’re able to handle anything now,” says Carey, whose made-to-order component operations average five or fewer setups per truss or wall panel design,
less than half the industry average. “The technology allows us a lot of flexibility [in design].”
In fact, demand for components in many markets is greater in the commercial sector. In Texas, for instance, non-residential projects rely heavily on roof and floor trusses while their housing counterparts stay with sticks. In Florida, says Groom, building codes designed to protect homes against high winds have limited the use of wood-framed walls in residential construction, but less so in commercial work—thus opening the door for panel sales to that sector. Nationally, nearly 60 percent of commercial roofs are framed with plated trusses while less than 40 percent of homes claim that distinction.
Meanwhile, diversifying into multifamily and commercial work represents a growth area for large production builders; such moves may, in fact, introduce them to component framing that could eventually carry over into the single-family side of their business or simply help them make the transition into commercial if they’re already familiar with trusses and panels in their housing operations. “The industry is much better equipped to handle the needs of builders and framers regardless of the type or complexity of their projects,” says Grundahl.
Reason #4: No Change in the Channel
Depending on the market, Stark Truss may sell its components directly to general contractors or builders, supply framers, or ship through lumberyards. “Distribution is completely market driven,” says Groom. “Each [manufacturing] plant manager oversees the strategy for that market to determine how builders get their framing materials.”
When partnering with lumberyards in a two-step arrangement, Groom diligently assures dealers he’s not out to steal their customers and sell direct. “We do our best to develop a mutually beneficial arrangement,” he says. “It’s in our interest to partner with people who understand the market and its distribution channels so we can come out with a win-win.”
Dealers that have developed in-house component capability are similarly sensitive to the chain of command. “All of our sales start at our lumberyard branches,” says Richard Pinson, general manager at Hayward Building Systems in Santa Maria, CA., which manufactures roof trusses exclusively for Hayward Lumber Co., a 12-location, $130 million dealer based in Monterey, CA.
Specifically, Pinson stations a truss technician at each of Hayward’s seven lumberyards to facilitate truss orders that come in from builders, framers, and design professionals looking for a one-stop LBM shopping experience. In addition to reducing the number of truss salespeople needed to sustain the business, Pinson has fostered goodwill between the company’s two main divisions by selling only through Hayward’s yards instead of also maintaining direct customers on the side. “There’s a synergy between the truss and lumber sides to help each other generate business.”
That same sensitivity extends to component suppliers, including lumber dealers with manufacturing operations, which sell trusses and panels to framing contractors. “Success as a panel manufacturer depends on your teamwork with framers,” says Johansen, whose reputation as a framing sub enables his company to gain business from local framers. “We know that a framer doesn’t want to change how he builds or fix someone else’s mistakes.”
To put local framers at ease about the possibility of snatching their builders away, Johansen’s crews field-train new customers on the nuances of panelization and work to align their expectations about the imperfections of factory-built framing. “We prep them to expect small errors, just like in stick-framing,” says Johansen. “If a problem is going to cost them time off the schedule, we’ll send a crew to fix it while [the framer’s crew] moves on.”
Generally, component suppliers with framing roots tend to fare better with the contractors in their markets. “Other framers want to do business with us because they know our process is designed around being successful as a framer, not just to sell components,” says Scott Stevens, president of Modu Tech, a Baltimore-based turnkey framer with truss and wall panel capacity that sells about 10 percent of its production to other framers in its market. “We’re a construction services business, not a manufacturer.”
In short, builders in any market, whether geographic or by building type, are looking for the easiest and most reliable way to build faster, better, and cheaper—a demand components definitely can satisfy. “Whatever business is supplying the framing marketplace, they need to be tied into the component segment in some way,” says Grundahl, including lumber dealers seeking to survive the sea of change. “We’re in the midst of a pretty significant evolution in the component industry, so it’s critical to look at your market conditions and decide how to participate.” —Rich Binsacca is a contributing editor for PROSALES.
Signs of the Times
If you’re looking for a sign that components are the wave of framing’s future, check out the following stats:
• In 2002, 39 percent of single-family homes and 56 percent of multifamily homes employed plated roof trusses, the highest percentage of any roof framing method for both types of housing. (2003 NAHB Builder Practices Survey)
• Installed materials purchased among builders include framing (71 percent), roof trusses (57 percent), floor trusses (52 percent), and wall panels (23 percent) (ProSales 2003 Builder Revolution Study).
• An estimated 790,000 homes built in 2002 (or about half of all new homes) had some form of panelized construction, most commonly roof trusses. (PATH Technology Roadmapping: Panelized Systems in Residential Construction)
• From 1997 to 2001, production of trusses and prefabricated [wall] panels increased at an average annual rate of 9 percent to $8.5 billion [in sales]. (U.S. International Trade Commission)
• In 2001, 29 percent of reported truss sales were to building material dealers and 71 percent to home builders, framers, and others. (U.S. International Trade Commission)
PROSALES
• Some large home builders have integrated backward into component manufacturing while some truss manufacturers have integrated forward into framing. (U.S. International Trade Commission)
• In 2001, the national market share for open-web floor trusses was 10.4 percent, up from 9.7 percent in 1997; the greatest growth occurred in the Midwest (13.6 percent from 9.4 percent). (U.S. International Trade Commission)
• In 2001, the national market share for panelized wood exterior walls was 10.3 percent, with the greatest growth occurring in the Northeast (22.1 percent from 14.8 percent). (U.S. International Trade Commission)
• In 2001, the national market share for roof trusses was 62.8 percent, led by the West (85.8 percent) and the Midwest (81.9 percent). (U.S. International Trade Commission)
• In 2000, 56 percent of WTCA members reported component sales of less than $7 million per year. (WTCA Financial performance Survey, 2001)
—R.B. Copyright 2005, Hanley Wood, LLC. Reprinted with permission.
The following article was published in Automated Builder, September 2004. Reprinted with permission.
Unique Framing Features Captured in MiTek/PCS Pro-Panel Assembly Line:
Continuous Flow Wall Panel Line Unveiled at AB&C
By Don O. Carlson,
Editor & Publisher
MEAD, NE-- "What Larry Peterson, my partner, and me wanted was the ability to feed lumber in one end and have smooth flow all the way out the other end where our finished wall panels would be automatically stacked. In other words, we're trying to emulate Henry Ford and his assembly line. Now, if we succeed in getting the lumber where we need it, when we need it we accomplish one of the biggest just-in-time goals in any wood products plant because materials handling is always a logistical nightmare." So states Randy Johansen, president, Advanced Building & Components, Inc., located here.
Quite apparently, the Scandinavian partners have obtained what they sought in the new MiTek/PCS pro-panel assembly line which runs 220' and swallows lumber at one end and stacks completed wall panels quite neatly at the other end. While still on a 'shakedown cruise,' it's believed the pro-panel assembly line will be able to produce 1,800 lin. ft. of sheathed walls with door and window openings. Unsheathed walls will hit 3,000 lin. ft. per shift.
Jim Oakley, sales manager, MiTek/PCS, states that Randy Johansen had 'a huge part' in designing this new wall panel line, elements of which will be on display at the BCMC show in Charlotte, NC next month. Johansen has a particularly good background for creating what he and his partner like to call the 'just-in-time wall panel production line.' Both he and his partner, Larry Peterson, started their careers as framing contractors. They worked together for a number of years, each heading his own separate framing firm. One day, the idea occurred to them that stick framing at a job site was anything but the world's most efficient way to approach their task so they decided to go into in-plant fabrication of wall panels. Today, the company grosses about $15 million annually selling wall panels to production builders, most of which are erected by the AB&C field crews in nearby territories or by other framing contractors in outlying regions.
"We were able to succeed in selling the concept of factory-made wall panels," says Johansen, "because we spoke the language of the framers. We were able to convince them that if they switched from sticks to panels, they'd not only not lose money, but in most cases would able to make more than previously because the jobs would go so much faster with far fewer headaches and less costly skilled workers."
Advanced Building & Components worked as framing contractors from about 1993 until 1997 when they concluded it was time to go into panelizing. Vice President Larry Peterson ran the field operation, while Randy Johansen spent all his time getting the plant built, equipped, and running. In year 1996 they did about $400,000 in business, but this year will gross well over $15 million. The firm is also starting to build and sell roof trusses.
While their enterprise started business in nearby Omaha, NE in a 10,000-sq. ft. plant, they quickly outgrew it and learned they could buy land, and build a building in the suburb of Mead for less money than it would cost them to lease the size structure they needed in Omaha.
Today, AB&C employs about 100 people, including 35 in the framing crews in the field, and 30 in the manufacturing plant including about 13 who operate the new JIT wall panel line including materials handlers.
There's not much question that the pro-panel assembly line is unique in many respects. And, some of the high points of the operation include:
At the start of the line, which MiTek/PCS calls the stud distribution and crowning area, an operator first checks his computer monitor screen to load the required 2x4s or 2x6s. He starts with a fill bunk of lumber and places each member on a conveyor which almost instantly moves each piece through a laser detection station. The laser can detect whether the crown is up or down and, if in the wrong direction, flips the lumber so all of the crowns are going through the entire machine are in the right position to ensure 'wave-less,' straight walls. This station is also capable of rejecting and culling out misshapen lumber.
All along the line are several stations where lumber can be stored in vertical magazine holding areas pending the need at the following stations. Lumber is released the CPC cutting area where some parts are cut to length for use in rough openings for doors and windows, or fabricated into headers, corners, or other sub parts. Full length studs are shunted directly down toward the station where complete wall panels are assembled.
Parts chosen for use in rough openings are conveyed to the fabrication area where they arrive in sequence as ordered by the software and monitored by the computer screen at the station. Following the computer generated screen information, they worker assembles the rough opening units which are then conveyed down toward the wall panel the wall panel assembly station. For the most part, the pneumatic fastening tools are Senco.
At the Power Framer station, three sets of coil-fed nailers mounted in each side of the line fasten the wall panels after they are securely clamped. The high speed tools drive two nails though each panel into 2x4s and three through the plates for 2x6 studs.
A unique, new machine call Twin Axis is designed to take all types of sheathing, OSB, plywood, or foam board, and optimizes for precise use on the wall panels. The machine cuts sheets as ordered by the wall design software. Workers grab the sheathing as it comes from the Twin Axis machine, and then tack it into position to hold it in place on the panel for the next operation.
An unusual turret bridge over the production line has three rotating rows of 22 nailing tools each. One double row carries 1"-wide crown staples, another carries 3/8" staples, and the third double line carries 1-1/2" nails. As the sheathed walls approach the nailing bridge it is perfectly squared and ready for specific fasteners as instructed by the software.
Finally, the completed wall panels are conveyed to the station called the Smart Crane which picks the panels up and stacks them neatly awaiting steel strapping and transfer outside for shipping.
At the end of that line, you pretty much have to conclude that Johansen and Peterson met their goals of 'just-in-time materials handling' from station-to-station and turning 2x4s or 2x6s into wall panels in a carefully thought out assembly line system.
Carlson, Don. Unique framing features captured in MiTek/PCS pro-panel assembly line: Continuous flow wall panel line unveiled at AB&C. Automated Builder, September 2004. p. 8-10.