These factors led to a decline in job activity for Engelman Construction, with sales dropping from $12 million annually to an expected $8 million in 2008. The company has been working with smaller employee rolls and focusing on efficiency to keep the company profitable. For instance, Engelman says the company has cut back its spending where it can, putting a "moratorium" on equipment purchases unless absolutely necessary and focusing more on maintenance. "We have a great maintenance program with three in-house mechanics, so where Company X gets two years out of a piece of equipment, we might get five or six years out of it," Engelman explains.
But that's not the whole story. The flexibility the company has with its diverse mix of services along with the precast company has allowed the Engelmans to shift their focus toward serving the stronger construction markets, such as precast. This year the Engelmans expect the precast company to bring in at least $3 million more in sales over previous years. They've moved many key employees from Engelman Construction to Bethleham Precast to keep them employed with the organization.
Engelman Construction is still seeing work across other parts of its business and has adjusted to market demands. In recent years the tilt-up market has flourished because of a boom in distribution centers in the area. While that business has declined, Engelman
Construction has kept crews busy by going after demolition and retrofitting work at existing distribution centers, adding additions and redoing floors. Engelman's crews are also busy doing site work, especially at schools, and Engelman says the residential decorative market remains very strong. "Homeowners are not going on vacation but upgrading their backyards with new decorative patios and pools," he says.
Keeping up with trends
Engelman Construction has always had a strong presence in the industry. Al Engelman was deeply involved with many concrete associations, and Jim has taken over that role for the company. "We're very industry and association oriented," Engelman says. "Being involved with associations has helped our business because we know where the market is heading."
Its involvement in the industry has tipped them off to new products and techniques over the company's history. Engelman Construction began performing decorative concrete in the late 1970s, and it introduced tilt-up construction to eastern Pennsylvania in the 1990s. Today the company is a prominent residential decorative contractor in the area, and the company performs about 50 percent of the tilt-up work in its market.
A more recent trend the company has embraced is pervious concrete. The Engelmans started experimenting with the system five years ago. "It's been a slow haul, getting it through to architects and engineers," Engelman explains. "We've had to educate them on the differences between what they think the system does and what it can actually do."
Engelman has been working with his ready mix suppliers to perfect mix designs and has laid test patterns for interested parties. The company is currently involved in a side-by-side comparison with pervious asphalt at a parking lot at Villanova University.
Engelman jokes that he's finally getting paid for some of his pervious work after five years of educating the area about the system. The education has paid off though, and he sees a lot of promise for pervious concrete. "Towns are starting to limit the amount of impervious structures on a property when you apply for a housing permit. You've got a lot of small lots, and with a big house and a pool there's very little land left," Engelman says. "We think driveways are a perfect application for pervious in these situations. And when we market that angle we can also go after a patio, a pool deck or other decorative work at the house."
Engelman also see pervious tied closely with sustainable building projects in the commercial and public markets. They've stayed informed on other issues in the "green" building market, working with fly ash and slag mixes. "We haven't started marketing a 'green' side to the company yet, but we see that trend coming. When we're bidding a project where we know someone is looking at sustainability initiatives, we let them know what we offer in that arena," Engelman explains.
Professionalism, experience and industry involvement has kept Engelman Construction on the leading edge of the concrete industry. With 50 percent of the company's business from repeat customers, its success shows. And in continuing with the company's philosophy on diversification, they strive to expand their company through niche services to market to new customers every year.