A Paving Industry Snapshot

So, more than a solid month into the season and what's the industry look like? Here are some anecdotal insights: * There's a lot of potential sealcoating work in the bid pipeline. Contractor after contractor I talk with says they tried to jump start their season by offering aggressive bids early on. Most of those bids have not been awarded, so that work is sitting out there waiting...and contractors are waiting hopefully on it. * Weather is playing a big role. Many Midwestern contractors, for example, stopped and started several times trying to get their season going but consistent rain forced late starts to the season. The obvious result is a backlog of work built up, which many contractors are just now starting to eat into. * A southeastern contractor says his crews are paying much closer attention to the weather -- not only each night and morning but at the end of each sealcoating job. If the weather looks threatening his crews shift to repair work. * A Midwestern paving contractor expects paving sales to be down 5% from budgeted numbers, due primarily to large commercial properties holding off on overlays and new parking lots. The plus side is that many of those properties are still seeking pavement repair and maintenance, but the volume isn't there from them. * A western contractor sees just the opposite: Sealcoating work in his market is down but paving is going great guns, primarily, he guesses, because hot mix costs aren't as high as last year and the customers are trying to take advantage of that. * Most contractors I talk with are scheduled about eight weeks out -- consistent with a typical year. * Margins, not surprisingly, are tight. But contractors are not lamenting that fact - instead reacting as if the tight margins are current "fact of life" they have to get through until the economy picks up. On the whole, contractors seem accepting of the current market and seem to be using the tight economy as an opportunity to re-evaluate how they are running their business, handling their jobs, and managing their crews. Many are also exploring adding additional services. That's just some of what I'm hearing. What's going on in your market?

Loading