Construction Boom Leaves Drywall In Short Supply

While the burgeoning housing market is receiving kudos for aiding our robust economy, the boom is also being targeted for causing nationwide drywall shortages and record prices. This despite factories operating at full capacity of roughly 27 billion sq. ft. of board annually.

This time last year, wallboard was selling at $9 a sheet, compared to $ll today. Worse, commodity scarcity is producing costly construction delays for contractors and their customers, who must pay additional interest in building loans while their residential or commercial projects await completion.

"I've got at least 25 houses that I can't get boarded," moans Bob Pasarela, owner of a drywall installation firm.

He's not alone. Emerald Builders, Houston, Tx., has 79 houses awaiting drywall, with plans to continue building l5 new homes a week. Sadly, the product isn't forthcoming anytime soon, never mind the approaching peak construction season. "I don't know what I'm going to do come June," laments vice president Craig Dudley.

Contractor desperation is such that many have resorted to paying retail, only to find that big boxes have limited how many sheets customers can purchase. "You start to beg," notes Christin Cupp, Beazer Homes USA Inc., who reported that a local Home Depot would sell her only 20 boards, not enough tojustify the expense. Depot spokesman Jerry Shields understands customer dissatisfaction, but notes, "We can't get as much as we need either."

With single family homes at a 2D-year high of l.4l million units, an unusually mild winter has compounded the problem, permitting continued construction during a period when bad weather normally prohibits such work. The country's remodeling fixation has further reduced supplies. Happily, relief is on the way, although not immediately. USG Corp., the nation's largest sheetrock producer, plans to open two more plants by year's end, with a third coming soon after. Currently, the firm is operating 23 hours a day, according to a spokesperson, a figure that has continued unabated for the past 15 months. Georgia-Pacific and Lafarge Corp. will open new plants late this year and next.

WOOD IIOULDING & Millwork Producers Association's 1999 executive committee was inslalled al lhe orouo's recenl annual meelino in Monterey, Ca. (L-r) 2nd v.p. Chadds Shawrrer, Roct<y Mountain Fdrest Producls; execulive v.p. Bob Weiglein, WMMPA; imrnediate past pres. Jim Snodgrass, Conlact Lumber Co.; treasurer Michael Massa, Corning Moulding Corp.; pres. Rick Hagel, Bums, Morris & Slewad, 1.P., and v.p. Guy Boulanger, Roland Boulanger & Co., Ltd.

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Lowe's Changes Ad Practices

As a result of a consulting firm's tests, Lowe's has amended several of its longtime advertising strategies.

The changes include deletion of cartoon figures from the #2 home improvement retailer's circulars and a stronger emphasis on tv ads.

"We've got to be smarter in the way we use our dollars," asserted Dale Pond, v.p., merchandising and marketing. He further noted that the tests, administered by QualPro, Nashville, Tn., revealed that customers prefer pictures of real people over cartoon figures and that additional circular pages don't improve sales. Lowe's newspaper circulars are delivered at least 25 times a year to 3G40 million homes. Future page counts will be shortened by 24 pages, to a maximum of 48.

After admitting that tv "has an even more important role than we thought," Pond disclosed that tv ad expenditures will increase over 207o this year. The strong link between consumers and sports marketing was another factor QualPro addressed, affirming Lowe's Nascar auto racing sponsorship.

Lowe's denied that the findings led to its recent decision to place its $100 million broadcast ad account in review.

G-P Plywood Stars on TV /

Georgia-Pacific has launched a multi-million dollar consumer tv ad program to promote its plywood.

The 3O-second spots on G-P Plus Plywood Sturdi-Floor are expected to run on cable stations, including the Weather Channel, Fox Sports and Home & Garden Television.

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