Fed up with Canadians
Some say the U.S. is now a better place to do business.
August 25, 2015 By Patrick Flannery
If discussions over beers at industry gatherings are any indication, there are some who are on the brink of abandoning Canada as a market. The complaints are familiar, but exacerbated at the moment because of the surge in demand in the recovered U.S. construction industry compared to the relative stagnation here.
Most complaints come down to a steadfast refusal on the part of Canadian general contractors, developers and property owners to recognize or pay for value. Large, well-established contractors and fabricators who have spent years and invested millions building reputations as providers of innovative and high-quality building envelopes feel they are being put in the mix with unproven bottom-line artists on projects that could and should benefit from their expertise.
Sellers get mad when buyers won’t buy their stuff – what else is new? Adding to the frustration now, though, is a perception that not only are the big buyers unwilling to purchase the more expensive glazing options, but that they are unable to realize why they should consider doing so, or why one glass company might be able to charge more for its services than another. The attitude of the Canadian construction buyers seems to be one of disdain for the bidders, with a focus only on extracting as much square footage as possible for as little money as possible with no view to future relationships or the ultimate fate of the project. The buyers’ view is, according to one representative of a large fabricator, “if one of us goes down, three more will spring up to take his place.” In the U.S., it is said to be easier to find fair bidding processes and buyers that will take a look at the whole package and possibly award bids accordingly.
These observations are general and exceptions will abound. But what reaction, if any, should our industry take to such a situation if it exists?
The first idea, to stop bidding on Canadian projects, seems obvious, but is probably only available to companies of a certain size. Bidding on U.S. projects means going up against some of the world’s largest building envelope providers, and it takes deep resources (or significant risk) to be able to compete. That said, many smaller Canadian glaziers could probably do more to reach out across the border. As our report on the recent Building Envelope Conference pointed out in June Glass Canada, there is a huge well of pent-up demand to the south that is just waiting for us to tap into.
But glass construction will continue in Canada and the question becomes on whose terms it will be carried out. Glass is the number-one most popular construction material in the world. Yet, when they enter the glass industry, people like Viracon’s Joe Puishys are horrified at the thin margins glass companies command. Our products and services are frequently treated like interchangeable commodities. A representative of a major glass supplier put it perhaps more bluntly than I would have: “This industry is dumb.”
Perhaps a greater sense of our own value is what is needed. Or perhaps measures such as Prompt Payment legislation and compulsory trade certification will put some leverage back in the hands of responsible contractors.
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