Page 1

Contractor Advantage COMPLIMENTARY

C a n a d a’ s

November/December 2010

M a g a z i n e

f o r

P r o f e s s i o n a l

C o n t r a c t o r s

Alternative Energies Plus: MOULDING SAVINGS TAX TIPS DOOR FORTUNES CEILING ART SUB-FLOORING

®


Nothing sells a home faster than adding cost-effective, energy-efficient insulation and weatherization products. That’s what you get when you add Dow Building Solutions to your team. Our broad portfolio of energy-efficient sheathing, housewraps, spray foam insulation and accessories is backed by 65+ years of building science experience and industry knowledge. It’s building performance you can measure – in lower utility bills for homeowners, fewer call backs and increased referrals. Find out how Dow Building Solutions can help you reach your goal for long-lasting energy efficiency at www.insulateyourhome.ca or call 1-866-583-BLUE (2583).

www.insulateyourhome.ca

The Hardest Working Team in the Building Industry ™ Trademark of The Dow Chemical Company (“Dow”) or an affiliated company of Dow

®

™ © 2008, VANOC.


November/December 2010 Vol. 16 No. 6

Contents

®

Castle Building Centres Group Ltd., with building supply outlets in every province, is Canada’s leading supplier of lumber and building materials to professional contractors, builders and renovators. Publications Mail Agreement #40006677 Return undeliverable Canadian Addresses to: 100 Milverton Drive, Suite 400 Mississauga, Ont. L5R 4H1

Editorial Director Castle Building Centres Group Ltd. Diane Jones Managing Editor Paul Barker Art Director James Wardell Contributors Nestor E. Arellano Patricia W. Atallah Mark Beckham David Chilton Lawrence Cummer Barbara Hemphill Josh Kerbel Frédéric Pansieri John G. Smith Paul Welch

Features ABC’s of alternative energies / 22 Not knowing energy alternatives can spell financial disaster for contractors as the markets shift.

Moulding savings / 29

Contractors are turning to pre-finished moulding options and MDF for faster and affordable moulding installations.

By the books / 37

22

The right accountant and an understanding of a few tax rules can improve your bottom line.

Door fortunes / 44

A fancy new door installation can cost effectively bring that ‘wow’ factor that creates happy customers in a matter of minutes.

Ceilings worth looking up to / 50

Ceilings, much like blank canvases, are waiting for the right master to turn them into stunning works of art.

44

Sub-floor selections / 57

They may sit out of sight, but that does not mean a contractor should ignore these all-important layers.

Advertising Enquiries Vendors whose products are carried in Castle Building Centres stores have the opportunity to advertise in

Contractor Advantage C a n a d a’ s

M a g a z i n e

f o r

P r o f e s s i o n a l

C o n t r a c t o r s

For more information or to reserve space in the next issue, contact: Diane Jones Advertising Manager, Phone: 905-564-3307 Fax: 905-564-6592 E-mail: djones@castle.ca Published and designed exclusively for Castle Building Centres Group Ltd. by Business Information Group Material Contact: Jessica Jubb 416-510-5194

57

Departments NEWS WATCH / 5

Housing activity stabilizing

NEW PRODUCTS / 9

New and improved products

LEARNING CURVE / 13

LEED Green exam guide

BUSINESS STRATEGIES / 15 SMART MONEY / 16

Construction contracts

ONLINE MARKETING / 18 ECONOMICS 101 / 20 CASTLECARE / 62

Technology to the rescue

Start thinking like a customer

Information toxic dumps

Building up your equity

Copyright 2010 CONTRACTOR ADVANTAGE

NOVEMBER/DECEMBER 2010

| 3


Designed to meet the toughest standards… YOURS.

It’s your job, your reputation, your neck on the line… that’s why you choose All Weather Windows’ award winning window and door products on every project. Designed to suit Canada’s distinct climate zones and building codes, they’re energy efficient, cost effective and CSA certified. We look forward to providing our support, advice and expertise on your next project.

All Canadian made for all Canadian weather All Weather Windows is a CSA Certified Manufacturer

Visit www.allweatherwindows.com to find a dealer near you

V a n c o u ve r - K e l o w n a - E d m o n t o n - R e d D e e r - C a l g a r y - L e t h b r i d g e - S a s k a t o o n - R e g i n a - W i n n i p e g - To r o n t o - H a li f a x

AWW Home Builder Award Ad July 2009.indd 1

7/27/09 9:18:50 AM


News Watch

CIL Predicts Sunny Yellow Will Be Winner Next Year

Photos: cil paint

The forecast for 2011 is sunny. Sunny yellow, that is, says CIL Paints in announcing its top colours for the year. According to the company, the hottest colour of 2011 is a light, citrus yellow, symbolizing a sense of fun, freedom and positive energy. “The new yellow is associated with warmth and sunshine,” says Martin TustinFuchs, Marketing Manager for CIL Paints, citing CIL’s Lime Twist (89YY 78/269) yellow as the brand’s 2011 colour of the year. “It is a very optimistic, cheerful and refreshing colour, sending a clear message that, as a society, we are finished with the tough times and look forward to brighter days ahead.” In the coming year, airy light yellow will be in all facets of home décor, from walls and furniture to accessories, Tustin-Fuchs says. CIL recommends adding a touch of citrus yellow to any room, even

dark interiors, to liven up the space. Pairing well with the new yellows are denim and turquoise blues, earthy browns, berry violets or airy pastels. Next year’s forecast extends beyond the

yellow family as fresh, cheerful colours that will dominate the entire 2011 palette, says Tustin-Fuchs. Each of the colour families emanates a feeling of optimism, with more brilliant colours taking centre stage across the board. For example: Blues: Evolving from last year’s stylish pale blue, next year’s blues are brave, bold and bright. Turquoise, teal, ultramarines and denims are now all the rage, partnering nicely with clay-toned neutrals, deep violets, greys and bright greens.  Greens: Vibrant, almost electrical, botanical shades are taking the spotlight in the green colour family. Oranges: Corals and warm tans are making a comeback, inspired by the homey, natural feel-good tones of clay and wood. Crisp oranges are most trendy when combined with charcoal and cardboard brown. Warm neutrals: In contrast to last year’s heavy, earthy brown, the 2011 warm neutrals are softer, more subtle and sophisticated.  Shades like putty, ash taupe and mocha dominate this colour grouping, tinged with green and yellow undercurrents. Cool neutrals: Light, airy and ultra-pale cool neutrals have replaced the previously fashionable bold, graphite greys. “From brighter mid-tones and zingy pastels, to authentic earth tones and deep shades mixed with both bright and light colours, everything about the 2011 colours is energetic and uplifting,” says Tustin-Fuchs. The 2011 popular colours are featured in the new CIL 2011 Colour Trends magazine. Further information is available at www.cil.ca.

CONTRACTOR ADVANTAGE

november/december 2010

| 5


News Watch

After rebounding in the second half of 2009 and early 2010, housing starts were expected to moderate in the second half of 2010. Starts are expected to stabilize at levels consistent with demographic fundamentals in 2011, according to Canada Mortgage and Housing Corporation’s (CMHC) third quarter Housing Market Outlook, Canada Edition. Housing starts are expected to be in the range of 170,200 to 198,400 units in 2010, with a point forecast of 184,900 units. In 2011, they will be in the range of 146,900 to 210,500 units, with a point forecast of 176,900 units. “Housing starts will moderate in the coming months as activity becomes more in-line with long-term demographic fundamentals,” said Bob Dugan, chief economist for CMHC.

6

|

november/december 2010

Dugan also noted that the existing home market conditions will remain balanced over the next two years as multiple listing services (MLS) sales ease and inventory levels remain elevated. Existing home sales will be in the range of 450,000 to 485,700 units in 2010, with a point forecast of 463,800 units. In 2011, MLS sales will

CONTRACTOR ADVANTAGE

move lower and are expected to be in the range of 425,000 to 490,700 units, with a point forecast of 456,000 units. With an improved balance between demand and supply, the average MLS price is expected to edge lower through the end of 2010 and then rise modestly in 2011. Meanwhile, the seasonally adjusted annual rate of housing starts was 183,300 units in August, according to CMHC. The seasonally adjusted annual rate estimate of housing starts activity was revised down in July from 189,200 units to 188,900  units, which resulted in a month-over-month decrease of 3% in August. “Housing starts moved lower in August, reflecting a decrease in both single and multiple starts,” said Dugan.

Photo: photos.com

Housing Activity Stabilizing: CMHC


News Watch

McGill Researchers Working On Green Manufacturing Process For Concrete Researchers at McGill University are working on a green production process for concrete block; they say if put into use across Canada and the U.S. could reduce the collective CO2 footprint by more than 3.2 million tonnes per year. The project is being supported by the Canadian Concrete Masonry Producers Association (CCMPA), which makes financial and in-kind donations to several Canadian universities and colleges, usually over fiveyear timelines. To date, the organization has committed a total of over $2 million with most grants supplemented by funds from organizations, such as, the Natural Sciences and Engineering Research Council of Canada (NSERC). “The project has just started in January (2010) and the results are promising,” says Professor Yixin Shao of McGill’s Department of Civil Engineering and Applied Mechanics. The process being developed uses carbonation rather than traditional steam to cure concrete block, and uses manufactured aggregates (sand and gravel) to help achieve carbon sequestration targets. Sequestration refers to the capture of carbon within the block in a way that prevents its emission into the atmosphere. In addition to reducing emissions, the process itself uses far less energy than steam curing. “If such a process could be applied to all blocks in Canada and U.S.,” says Professor Shao, “the environmental, economic and technical benefits would be tremendous.” Paul Hargest, president of the CCMPSA says construction generates about 6% of Canada’s GDP and employs well over a million Canadians. “Within that sector, concrete masonry plays a foundational role, figuratively and literally.” He points out that concrete block is one of the most durable, long-lasting and fire-safe materials available, adding that a lot of research and a certain set of skills go into ensuring that continued strength and

production quality. The seismic response of masonry, for example, the degree to which it withstands earthquakes, is a key focus of the research currently underway at the University of Calgary and Hamilton’s McMaster University. In Calgary, CCMPA funding of $250,000 over five years is allowing researchers to develop and conduct tests that measure the resilience of historic masonry structures, such as, the Parliament Buildings in Ottawa and the Prince of Wales Fort near Churchill, Man. The testing in Ottawa is particularly significant following the June

23rd earthquake that, measuring 5.0 on the Richter scale, was centred just across the Ottawa River in Quebec. This region is vulnerable to quakes because of a major fault line that runs through the Ottawa Valley. The seismic testing at McMaster University, which houses the largest masonryresearch team in North America, involves the use of an industrial-grade concrete block production machine purchased in 2008 using $200,000 in CCMPA funds. McMaster is now producing test blocks for use at its own facilities as well as for donations to other schools.

New Construction Safety Association In B.C. To Serve Over 38,000 Companies British Columbia’s construction employers and workers now have access to health and safety programs through the BC Construction Safety Alliance (BCCSA) which resulted from the amalgamation of the Construction Safety Network and the Construction Safety Association of BC. Goals and priorities which founded the previous two construction safety associations will continue with the new BCCSA with a concentration on the Certificate of Recognition (COR) Program. Under the new BCCSA delivery format, construction employers throughout B.C. will have greater accessibility to COR certification courses. “The safety of workers across British Columbia is a priority for my ministry,” said Murray Coell, the province’s labour minister. “The Alliance will provide a focused approach to workplace safety at all levels across the B.C. construction industry by centralizing resources and expertise. I am encouraged that this will enhance worker safety while making tools and resources more accessible to industry employers.” The BCCSA will concentrate its programming and resources on the top three causes of injuries and death (falls, being struck and overexertion) to construction workers. Their approach to these problems will be evidence based and the solutions will be developed and implemented through consultation with WorkSafeBC and the industry. The BCCSA’s primary goal is to reduce construction workplace illness and injury, said Wayne Fettback, chair of the BCCSA Board of Directors: “One Association will make it easier for employers to implement health and safety programs and services based on the tools and resources developed by the BCCSA.” The BCCSA will partner with WorkSafeBC to deliver safety education and training to all BC construction employers. More information is available at www.bccsa.ca.

CONTRACTOR ADVANTAGE

november/december 2010

| 7


DUST CONTROL™ Drywall Compound by CGC is the first and only joint compound to reduce airborne dust.

HOME RENOVATIONS

OFFICES

HEALTHCARE

SCHOOLS

FOOD SERVICE

Dust Falls Straight to the Floor! Introducing DUST CONTROL™, a revolutionar y new dr ywall compound by CGC. DUST CONTROL™ is the first and only dr ywall compound engineered to significantly reduce airborne dust from sanding. It is ideal for those jobs where protection from dust infiltration is crucial such as homes, schools and office environments. With DUST CONTROL™ Dr ywall Compound, dust falls straight to the floor, making clean-up faster and easier than ever.

The CGC logo and DUST CONTROL are trademarks of CGC Inc.


New Products

Building Blocks

Innovative Products for Today’s Renovators PAM’S HOT MELT ADHESIVE SPEEDS UP BONDING OF CARPET TACK STRIPS PAM Fastening Technology has introduced a new hot melt adhesive that creates a high strength non-toxic bond between carpet tack or metal clips and the finished concrete, fibre cement backer board or wood before stretching a carpet over the floor. The Series UX 8012 Hot Melt Adhesive from PAM Fastening complements the company’s Model HB 220 Hot Melt Glue Gun that accommodates the temperature required to apply the adhesive. Benefits of using the adhesive for the carpet installer include the strength of the bond and its quick five-minute set up time. According to the company, this results in greater productivity for the carpet installer since the installer does not have to return the next day or wait hours for the adhesive to fully dry before stretching the carpet. Performance, the company says, is similar to a more costly pressure sensitive hot melt adhesive.

STANLEY-BOSTITCH LAUNCHES NEW LINE OF GAS-POWERED NAILERS Stanley-Bostitch recently released five new gas-powered nailers, which the company says delivers the power and performance of compressor-driven nailers, while giving users the flexibility and maneuverability that comes with being compressor-free. Easy to handle and lightweight, which means less strain on the job and less pain at the end of the workday, the nailers have over-moulded comfort grips for better handling when in use, and are made of high-quality materials to last longer. With a suggested retail price of $399.99, the cordless Framing Nailers weigh just 8.3 lbs. and at full range, drives 3 1/2” nails using a gas cell with a life of 1,200 nails. The world’s first 28° nailer, model GF28WW will run the company’s own 28° wire-weld nails, while the 33° model GF33PT nailer will run Bostitch’s “D” head paper tape nails. Further information on the 15-Guage, 16-Gauge and 18-Gauge models is available at www.bostitch.com.

CONTRACTOR ADVANTAGE

november/december 2010

| 9


New Products

NO REMODELLING NEEDED WITH NEW MOEN SHOWER ARM A new shower arm from Moen Canada provides users with the experience of a ceiling-mounted rain shower from a wall-mounted showerhead. The new shower arm is easily installed into existing plumbing, allowing consumers to update their shower at a fraction of the cost of a complete bath overhaul. The shower arm is available in a number of finishes to coordinate with Moen Canada’s entire showering portfolio, which includes Chrome, Antique Nickel, Antique Bronze, LifeShine Brushed Bronze, LifeShine Brushed Nickel, Pewter, Oil Rubbed Bronze and Wrought Iron. It is also compatible with the company’s M•PACT® common valve system.

Powdered MeTaL reCIProCaTInG Saw BLadeS T24502B-T24509B

Faster Cutting. Longer Lasting. TASK Signature Recip Blades are up to 65% faster and last up to 2x longer than competitors' best Bi-Metal blades. Powder Metallurgy for unmatched heat resistance and extended blade life Unique Blasted Tooth Treatment keeps cutting edges sharper for longer Increased Body Height & Thickness for straighter cuts Improved Tooth Geometry and Pitch for faster and cleaner cuts

9"

T

SF

4JHOBUV

H - TEC LOG OYNT Ht N-OFR

C TEin e Im L pr BlDad META

D POWDERE

CK t - BA

CHNOLO METAL TE

int - BACK Blade Impr

DPP TPI / tes/ dien . pulg

ETA DE M OGÍA CNOL

V L PUL

ERIZA

De mo lit ion Dé mo lit ion De mo lic ión

9"

NOLO GY - TECH

e Die Lin T Label IN OT PR -DO N

229 mm

GIE DE

e

Label Die Lin

8/10

TPI / DPP dientes/ pulg.

POUDRE TION À LA MÉTALLISA

OG - TECNOL

|

november/december 2010

CONTRACTOR ADVANTAGE

ERIZ TAL PULV ÍA DE ME

ADO

Use our HEAVY METAL blade for quick cuts in heavy metals or use our DEMOLITION blade for agressive cutting in heavy metals and nail embedded wood. All models available in 6" and 9" lengths. Visit our website www.task-tools for more info.

T

IN -DO NOT PR Go to your nearest Castle Building Centre to get yours today!

10

DO

LL

T24509B

Imprin

TA E MÉ GIE D

06B

Blade

NOLO

4JHOBUVSF

DERE POW

8/10

ta l y Me - TE Heav u st e s UDRE l ro b d u ro A PO M é ta ta le s e NÀL m a ISATIO C o rt

T245

ON t - FR Imprin Blade

m

229 m


New Products

FATMAX XTREME CLAMP LEVEL COMES WITH LIFETIME ACCURACY WARRANTY The Stanley FatMax Xtreme clamp level system accommodates both 2 and 4 dimensional lumber (1-1/2”, 3-1/2”) and securely holds the level to studs, whether horizontal or vertical, freeing up both hands to work. It has a Max Edge bridged center vial (patent pending) that allows for a continuous marking edge as well as an open line-ofsight to the center vial for reliable measurement. Available in 24” or 28” lengths, the system is built into the ends of the levels where there is the additional benefit of absorbent end caps that provide extra protection to the high-wear areas of the level. Stanley FatMax® Xtreme™ Clamp Levels are available for a suggested retail price of $99.99 and come with a lifetime accuracy warranty.

EASY-PINE ‘QUICK-LOCK’ PANELlING SPEEDs UP INSTALLATION TIME Nicholson and Cates recently announced they are now distributing Easy-Pine, installation-ready factory-finished pine interior panelling for walls and ceilings. Each piece of Easy-Pine is a premium long length and comes with a “Quick-Lock” feature. The end-matched pine panelling eliminates the need to end on studs or to square the ends. This results in a huge time savings and reduces waste, thus saving time and money. Other end-matched products have a V-groove at each end and short random lengths. This creates a very busy look. Your eyes are drawn to the seams not the overall beauty of the wall or ceiling. The finish system is virtually VOC Free and produces no hazardous air pollutants. The panelling is available in five different finishes and comes with a 15-year limited warranty.

CONTRACTOR ADVANTAGE

november/december 2010

| 11


TECHNOLOGY

o

Whatever your next project is, Mechanix Wear Commercial Grade Series and Hardware Series gloves will help you achieve it. Mechanix Wear Gloves. The Tool That Fits Like a Glove速. Toll Free: 877.278.5822 Phone: 604.542.7055 Fax: 604.542.7057

mechanixwear.ca


Learning Curve

Test Help & A Survival Guide

Two new releases focus in on LEED Green Associate exam and how to build up your business in good times and bad.

book Guide to the LEED Green Associate Exam

COTTRELL

ture/Engineering/Sustainable Design/Exam Preparation

ROVEN STRATEGIES TO PASS THE ED GREEN ASSOCIATE EXAM

John Wiley & Sons, Inc.

®

ere is the ideal study guide for understanding and preparing for the LEED® Green Associate exam. Written by an expert

who is a LEED consultant and partner at Green Education Services—a premier LEED exam preparation provider— Guide to the LEED ® Green Associate Exam engages readers by breaking down difficult concepts in sustainable

LEED ® Green Associate Exam features:

horough overview to understanding the LEED certification process

collection of sample test questions and study tips to reinforce learned material accessible and stimulating approach that fosters quicker retention

set of strategies for summarizing critical information and details more effectively

wealth of material that includes drawings, charts, and diagrams to help understand concepts visually

otal of 128 sample flashcard tips that allow you to study on the go!

ED Green Associate exam.

ELLE COTTRELL, LEED AP, is Vice President and Director of Education at Green Education Services, where she is

sible for curriculum and course development. She is also the founding principal of Design Management Services, D consulting firm that supports project teams through the certification process from design through construction.

D Accredited Professional, Cottrell has more than ten years of experience specializing in commercial projects as a

able design and LEED consultant. Education Services (greenedu.com) is a leading provider of green jobs training related to LEED, energy auditing,

and more for building developers, architects, engineers, interior designers, planners, commercial real estate brokers, her construction industry professionals. A national member of the U.S. Green Building Council and an approved S registered provider, Green Education Services has helped thousands of professionals throughout the United prepare for their credentialing exams.

®

ng basic knowledge of green design, construction, and operations for professionals who want to demonstrate green g expertise in nontechnical fields of practice, this book is the ultimate companion for achieving successful results on

GUIDE TO THE LEED GREEN ASSOCIATE EXAM

and engineering in a clearly organized, straightforward manner that helps streamline the learning process. Serving luable resource for anyone taking the exam to obtain the challenging LEED Green Associate credential exam, Guide

For contractors seeking credentials, passing the LEED Green Associate exam demonstrates a basic understanding of green building systems and technologies. GREEN ASSOCIATE The exam is applicable to all proEXAM fessionals who work in the world of MICHELLE COTTRELL, sustainable design, construction and operations; including lawyers, developers, contractors and owners, as well as architecture and design professionals. To better help professionals understand and prepare for the exam, Wiley Publishing has released the Guide to the LEED Green Associate Exam. Written by Michelle Cottrell, an expert LEED consultant and partner at Green Education Services, this 208-page study guide breaks down difficult concepts in sustainable design and engineering in a clearly organized, straightforward manner LEED AP

978-0-470-60829-6

to streamline the learning process. The guide includes proven strategies to pass the LEED Green Associate credential exam, including: • A thorough overview to understanding the LEED certification process; • A collection of sample test questions and study tips to reinforce learned material; • A set of strategies for summarizing critical information and details more effectively; • Drawings, charts, and diagrams to help readers understand concepts visually; • And, a total of 128 sample flashcard tips to encourage on-thego study. It covers all basic knowledge of green design, construction and operations including site selection, water efficiency, energy and atmosphere, materials and resources, and indoor environmental quality.

book The Contractor’s Survival Guide Delmar Cengage Learning

Delmar’s The Contractor’s Survival Guide: Building Your Business in Good Times and Bad, released in October, provides contractors with the tools needed to succeed. Author Jason Reid, a contractor with first-hand experience, provides readers with proven techniques to build their brand, increase sales leads, cut costs, drive profits, and improve the overall productivity of their businesses. It helps identify the most effective areas to spend marketing dollars, how to best gather qualified but inexpensive leads, how to sell more estimates, and the driving of business through the Internet and social networking Web sites. The guide pays special attention to industry-specific trends and the latest technologies; making it well suited for contractors looking to drive business growth in both turbulent and

strong economies. Written in a fun, engaging style, the book encourages readers to start making positive changes to their businesses today through easy to implement ideas. It inspires readers to set themselves apart from the competition by offering tried-andtrue strategies that separate successful contractors from less successful ones. Chapters are dedicated to branding, marketing, time management, technology, business intelligence, expenses, pricing, planning and more; including comprehensive sections devoted to managing and motivating employees, building a sales team, and maximizing relationships with outside contacts, like banks, CPAs, and lawyers. Both the Guide to the LEED Green Associate Exam and The Contractor’s Survival Guide: Building Your Business in Good Times and Bad are currently available at Amazon.ca.

CONTRACTOR ADVANTAGE

november/december 2010

| 13


DWCordlessAd_12VMAX_CntrctrAdv

9/28/10

2:08 PM

Page 1

The DEWALT Family of Heavy-Duty Cordless Power Tools is proud to announce the arrival of its’ newest addition, the Compact line of 12V MAX* LITHIUM ION cordless tools. Each of the tools in the system weighs less than 3 lbs so you can work all day long. The 12V MAX* LITHIUM ION batteries deliver exceptional performance and extended run-time. Innovative features, such as, one-handed bit loading capability, 12V MAX*

3 LED lights and a sleek contoured handle

1/4” Impact Driver

design are all part of a 12V system that other compact tools will look up to.

12V MAX*

Inspection Camera

12V MAX*

3/8” Drill/Driver

12V MAX*

1/4” Screwdriver

12V MAX*

3/8” Impact Wrench

12V MAX*

Infrared Thermometer

12V MAX*

LED Worklight

*Maximum initial battery pack voltage (measured without a workload) is 12 volts. Measured under a workload, nominal voltage is 10.8. Copyright ©2010 DEWALT. The following are examples of trademarks for one or more DEWALT power tools and accessories: The yellow and black color scheme; the “D”-shaped air intake grill; the array of pyramids on the handgrip; the kit box configuration; and the array of lozenge-shaped humps on the surface of the tool.


river

Business Strategies

Technology To The Rescue

Software such as building information modeling or BIM has the potential to transform the entire construction industry. By Patricia W. Atallah

There is a bright spot where real innovation and expansion is happening: construction IT. It would even be safe to say that there is a revolution going on that is likely to transform the industry. For the first time, through the advent of building information modeling (BIM) and other innovative and collaborative products over the past few years, software is becoming a viable “back room” catalyst for improving efficiencies and containing risk throughout a project lifecycle, and for virtually everyone in the food chain. I have followed developments in construction IT since the late 1990's, with the proliferation of over 170 firms vying for leadership roles in providing Web-based supply chain and project collaboration solutions to the construction industry. Fast forwarding past the dot-com meltdown and into the 21st century, the surviving players, such as Oracle (Primavera), Autodesk (BIM), Meridian Systems (Prolog, Proliance), Sage (Timberline), E-Builder and Canada-based CMiC, have solidified their positions in the market. They have moved in the direction of integrating the entire construction planbuild-operate process via sophisticated enterprise-wide collaborative software and Web-based systems, and have been working to improve user-friendliness and functionality. Many of them have global applications for international owners and contractors. The market leaders have been joined

in the past four to five years by new and fast-growing niche players that offer innovative systems and tools designed to tackle specific bottlenecks in the planning and construction process (i.e., document management, payment processing, procurement, vendor pre-qualification, labour productivity management) that provide seamless integration with a customer’s existing systems.

erly, the right software configuration can: • Facilitate collaboration between the project owner, design team, contractor, subcontractors and suppliers, and enforce consistent standards and best practices • Help project participants to improve productivity and efficiency, manage risk and maximize the bottom line • Lighten the load of the owner contractor developer by simplifying pro-

The right software configuration can facilitate collaboration between the project owner, design team, contractor, subcontractors and suppliers, and enforce consistent standards and best practices In a market plagued by project delays and cancellations, reduced funding, tight credit, strained project revenues and cash flows, many construction owners, contractors and suppliers are scrambling to stay profitable. For those industry participants who are prudently working to reposition themselves and strengthen their business and construction operations, now would be a good time to take a close look at internal processes and controls and compare current systems in place with alternatives in the market today. Customized to client needs and utilized prop-

Tricia Atallah is Principal of VantagePoint Strategy Group, a strategic and management advisory firm serving the construction industry. She is also author of Building a Successful Construction Company. Further information on the book is available at www.constructbiz.com.

cedures, enabling them to focus on successful execution • Offload support functions so that project participants can focus on performance • Manage a portfolio of projects • Enhance company efficiency, allowing organizations to streamline procedures, maximize profitability and minimize risk • Force better financial controls over cash management, payment streams, etc. • Offer better management tools for timely and prudent decision-making • Provide seamless interface and integration among systems, such as accounting The existing industry leaders have now been joined by new firms, and there are upand-coming software developers to watch for. Technology may ultimately save the construction industry. It is applicable to all stakeholders for seamless integration and co-ordination and can tighten the management of the supply chain.

CONTRACTOR ADVANTAGE

november/december 2010

| 15


Smart Money

Construction Contracts

Contractors need to know the right time to collect GST and HST. To effectively comply with the rules, terms of a contract must be tracked diligently. By Frédéric Pansieri

A construction contractor must normally charge GST or HST on an amount owed by a customer as it becomes due or is paid (other than as a deposit), whichever comes first. The above rule seems simple enough to follow; however, there are unique circumstances for the construction industry because of the continuous supply of construction services and payments, made either periodically or from time to time. This article is a brief summary of rules that dictate when a contractor must charge sales tax (GST or HST) on the services provided. When the amount becomes due: For GST/HST purposes, an amount owing normally becomes due on the earliest of: • The date an invoice is first issued for the amount owing. An “invoice” includes a statement of account, a bill and any other similar records. The Canada Revenue Agency (the “CRA”) takes the view that an invoice is a document which either notifies a customer of the obligation to pay or records payment. However, the CRA makes a distinction between “invoice” and “request/application for payment” (“request”) issued (and identified as such) by the contractor. The CRA will not consider such a request to be an invoice where the construction contract provides for the contractor to submit the requests for payment on a regular basis during the term of the contract and where the customer is required to pay the amount approved within a specific number of days following the

certification of the value of the work completed. The invoice date is the date appearing on the invoice regardless of the actual date on which the invoice was issued to the customer. • The date the contractor would have, but for an undue delay, issued an invoice for the amount owing. • The date the customer is required to pay the amount owing under the terms of the written construction contract.

The Canada Revenue Agency takes the view that an invoice is a document which either notifies a customer of the obligation to pay or records payment. The CRA takes the view that this would include the specific dates on which progress payments are due according to the terms of the contract. Alternatively, this could include the dates on which progress payments become due as work on a project proceeds. The CRA will accept that the amounts that become owing under the terms of a construction contract are either pre-determined or based upon the percentage of the work that has been completed on each of the dates specified in the contract. In other cases, a progress payment may be due when specific portions of the contract have been completed (e.g., pouring of foundation) or when specific events have occurred (e.g., preliminary in-

Frédéric Pansieri is a Senior Manager in the Tax Group at Soberman LLP, Chartered Accountants. He has extensive corporate income and capital tax experience as well as commodity tax experience at the federal level and in various provincial tax jurisdictions across Canada.

16

|

november/december 2010

spection of the building). When the work is done: It is not possible to postpone indefinitely the tax collection once the work to be done under a construction contract is substantially (90% or more) complete. GST or HST will become payable on any amount owing on the last day of the month following the month in which the construction work is substantially completed. If part of the remaining amount owing cannot be determined at

CONTRACTOR ADVANTAGE

that time (for instance, because some of the costs are not yet known or because part of the amount owing is under dispute with the customer), the tax will become due on that part of the amount owing on the day the amount is established. Here is an example: A contractor is working on a “cost-plus” arrangement where the contractor is reimbursed for expenses plus 10%. Therefore, the contractor cannot issue an invoice until the actual expenses are known. If the construction work is substantially completed on June 3, 2010, the tax will become due on any amount still owing on July 31, 2010 unless some part of the amount owing is not known because some of the contractor’s expenses are still not known at that time. The tax will become due on the balance of the amount owing when the final expenses are known to the contractor. When the amount is paid as a deposit by the customer: If a deposit is paid to the contractor (for example, to secure the future en-


Smart Money

gagement of the contractor), it is not considered to be an amount owing for work to be done under the construction contract, whether or not the deposit is refundable to the customer. The deposit is not subject to tax until the contractor applies the deposit against amounts owing for the services provided under the construction contract, (for example, as a credit against the first progress payment owing). Even though the contractor is not obligated to collect sales tax on a deposit, if the deposit includes sales tax, the contractor must report the tax in the GST/ HST return for the date the deposit is received. It is, therefore, important for the contractor not to make any reference to sales tax in documentation requesting or describing the deposit.

Holdbacks: Regardless of the above rules, if the customer is able to retain a “holdback� in respect of an amount owing because of existing Canadian legislation or pursuant to the terms of a written construction contract, the time the tax becomes due will be deferred to the earlier of the day the holdback is released or the day the holdback is paid by the customer. The format of the invoice is also really important to ensure that the contractor is only required to collect and remit the GST on the contract price net of any holdback. For example: If the total contract price for work done in Alberta is $100,000 with a 10% holdback, the contractor should apply the GST as follow: Total contract price: $100,000 Less 10% holdback: $ 10,000 Subtotal $ 90,000 GST (5%) $ 4,500 Net payable: $ 94,500 The result would be different if GST or HST has to be collected and remitted on the full contract price of $100,000 in-

stead of the net amount of $90,000, even though the net amount payable by the customer remains the same: Total contract price: $100,000 GST (5%) $ 5,000 Subtotal $105,000 Less 10% holdback: $ 10,500 Net payable: $ 94,500 Conclusion: Normally, the contractor is required to report the applicable tax in the GST/HST return for the reporting period in which the amount owing becomes due or is paid, whichever comes first. To effectively comply with the requirements to report the tax in the GST/HST return in a timely manner (and avoid interest for late payments), the contractor must diligently track the terms of the contract, the payments received and the documents issued to customers that the CRA may view as invoices. This article has been prepared for general information based on the Excise Tax Act and related publications issued by the CRA. Specific professional advice should be obtained prior to the implementation of any suggestion contained.

CONTRACTOR ADVANTAGE

november/december 2010

| 17


Online Marketing

Start Thinking Like A Customer Developing a strong Internet market strategy is exactly the same as building a house. A plan and blueprint are paramount. By Josh Kerbel

Before spending a dime on revamping your Web site, hiring a social media consultant or hopping on the latest Internet marketing fad, there are two things you need to understand. In fact, if you only remember these two points, you will probably be further ahead than 95% of your competition and save yourself a pile of money. First of all, remember this cliché, failure to plan is planning to fail. Developing a strong Internet marketing strategy is exactly the same as building a house. You need a plan and you need a blueprint. Any good marketer knows that marketing is just as systematic as building a house. Secondly, your customers are selfish; they do not care about you, your company and its products. They care about their needs, wants and problems. When you are putting together a business proposition for a client, remember how you make a buying decision. I guarantee it is not because of someone’s pretty pictures. The basics of online business: Finding a company in the construction industry without some form of Internet presence, would be quite a challenge. (E-mail counts, you know.) Still, since the Internet hit mainstream, construction industry players should be better at using the Internet as sales and marketing channel. All you have to do is look around and listen to the sound of sales people cold calling or count the money your company spends on trade shows, advertising and entertaining potential clients. The temptation is to start ranting about the how and why of online marketing, search

engines and site design as the cure to what ails your business, but they are not, they are merely the tools; just like a hammer, saw or forming mould. The solution to increasing sales is simply understanding what is going on inside your prospects’ heads. It comes down to knowing “why” and “how” your prospects buy. Since the days of Rome, the buying process has not

Put yourself in your customers’ shoes and if you cannot make an intelligent decision based on the information you have on your site, this is where you need to start your planning. changed. While you may not be able to explicitly articulate this, you obviously understand the concept or you would not be in business to begin with. What you need to do is make the implicit explicit. You need to stop thinking like a business owner and start thinking like a customer. Let us get your head in the right space and think of your last major purchase, maybe a backhoe, a pneumatic drill or even a new car. Ask yourself one question, “Why did I make that purchase?” They need, they buy: Regardless of what you sell, there is one reason why people buy your product or any other product for that matter. People buy because they have

Josh Kerbel, our newest columnist, is managing director of Sales Funnel, a digital marketing agency that specializes in lead generation and prospect management systems. To get a copy of the free white paper, 8 Steps to Internet Marketing Success, send an e-mail to report.ca@thejoshkerbelproject.com

18

|

november/december 2010

a problem that needs solving and hopefully your product provides the benefits that solve their problem. No one ever buys a drill, they buy holes. No one buys a five bedroom, three storey, 5,000 square foot house with stainless steel appliances and heated driveway, they buy the status, owning a house like that. Customers buy a product or services be-

CONTRACTOR ADVANTAGE

cause its benefits provide them with a solution to a problem they are having. In most cases, your years in business, your awards or your brand name are secondary considerations that help reassure the customer after they have reached their decision; they are not the primary drivers. Think about why you made your last purchase. Why did you do it? Chances are it was because you had a problem that needed solving and you liked the benefits the product provided. The Internet knows everything: If you did not know this before, you do now. People make purchase decisions based on how well a product is expected to solve their problem. Look at your sales process right now; can you honestly say that your sales process and marketing material help prospects solve problems? Does your marketing material even take this approach to begin with or is it filled with empty words that sound important?


Online Marketing

If your Web site does not offer prospects information to help them solve their problems, prospects bounce off your site in under 10 seconds. Turn rooms with cold, damp concrete floors into spaces that are dry, cozy and foot-friendly.

AdvAnced duAl-boArd technology seAls in dryness And wArmth 5

4 3

2 1

1

Concrete

4

• Often cold and damp

2

3

Composite-rubber layer

photo: hemera

• Seals out moisture • Resists mildew and mold • Environmentally friendy and recyclable

Before you scoff at me, remember, all customers go through similar steps when making a purchase decision. This is how it works: • Prospects identify a problem, then, • They explore possible avenues for solving this problem. • During the searching process, they evaluate and redefine the buying criteria for the decision, narrowing the field of choice to a few alternatives. Depending on whose research you read about online behaviour, 50% to 85% of this research is done online. • Once prospects gather enough information, they choose which solution to purchase. Take advantage of the purchasing cycle: The hammer hits the nail when people search the Web in search of answers. Does your Internet presence take advantage of the research activities of people who might buy your products? Does it provide useful

directed information that allows your prospect to make an intelligent decision? If your Web site does not offer prospects information to help them solve their problems, prospects bounce off your site in under 10 seconds. If you provide prospects with useful information, you start the trust-building process needed to complete a sale. Look at your Web site. Does it teach your customer what they need to know to solve their problems? If not, you need to fix it. So, before investing any more money on your marketing strategy, examine how your Web site facilitates each step of the purchasing process. Put yourself in your customers’ shoes and if you cannot make an intelligent decision based on the information you have on your site, this is where you need to start your planning.

• Stable and warm • Not damaged by flooding, dries quickly • Ideal base for tile, carpet, engineered wood floors

Airspace • Water can flow to drain or sump • Air circulates helping prevent mold

Magnesium-oxide board

5

Finished floor covering • Tyroc stabilizes engineered wood, ceramic and vinyl tiles and helps keep carpet dry, preserving it

Made from recycled tires and plastic bottles to reduce our carbon footprint.

environmentAlly responsible

11.5 recycled tires + 6800 recycled plastic water bottles

= 500 sq. ft. of tyroc overflooring

CONTRACTOR ADVANTAGE

tyrocinc.com november/december 2010

| 19


Economics 101

Stopping Information Toxic Dumps

Your ability to accomplish any task or goal is directly related to your ability to find the information you need when you need it. By Barbara Hemphill

Kathy is the office manager for a large corporation. The great news is that the company is growing and Kathy is looking for employees to handle all the new clients. The bad news is that she has no office space in which these new employees can work. The truth is, the office and storage areas are full of filing cabinets and the desks are covered in stacks of paper. The worst part is that Kathy and her staff do not even know what all that information is. It is no surprise that Kathy cannot find space for new employees, since as she is wasting it with massive amounts of files and paperwork. Does your organization have offices, file cabinets, storage rooms, and offsite facilities full of unidentified paper files and electronic documents? Are there files in your office that you have never opened and probably cannot identify? Have you ever come across a piece of information you did not know whether to save or throw away, so you saved it, just in case? If so, you are working in an “information toxic dump.” Research shows that 80% of the information kept in most offices is never used. Ironically, the more information that is kept, the less it is used, simply because it is too difficult for employees to find. Often employees cannot even find the documents they themselves created, let alone any information created by another employee, especially someone who is no longer with the organization. Why information management matters:

Your ability to accomplish any task or goal is directly related to your ability to find the information you need when you need it. Finding information in every organization, regardless of whether it is in paper or electronic format, is becoming an everincreasing challenge. This inability to find information causes all sorts of problems for the organization and for the individual: wasted time looking for information or recreating already existing informa-

Have you ever come across a piece of information you did not know whether to save or throw away, so you saved it, just in case? If so, you are working in an “information toxic dump.” tion, missed opportunities and increased stress, which results in increased health care costs. Addressing poor information management: Blame for the information management disaster falls in several courts: • Management blames employees for the problem • Employees blame management for the problem • Organizations do not have a userfriendly system • Employees are not trained on the filing systems

Barbara Hemphill helps individuals and organizations create and sustain a productive environment. She is author of the best-selling “Taming the Paper Tiger” book series. For more information visit www.barbarahemphill.com.

20

|

november/december 2010

• Management fails to look at records management as an ongoing activity. To create and maintain an effective information management program, you must answer the following six questions: 1. What information should we keep? 2. In what form? 3. For how long? 4. Who is responsible for maintaining the information? 5. Who needs access to the information?

CONTRACTOR ADVANTAGE

6. How can everyone who needs the information find it? Answering those six questions requires the co-operation of everyone in the organization. It can easily take up to one year, or even longer, to answer them, since accuracy requires addressing the questions over a one-year business cycle at a minimum. Creating and maintaining an effective information management system: Use the “Productive Environment Process” to implement a new system. This can be applied to organize information in any organization. 1. State your vision. If your information management program is successful, what will you be able to do that you cannot do now? What positive effect will an effective information management program have on the organization and your customers?


THE EASIEST

The Art of Wastebasketry

photo: able stock.com

When faced with too much paper, ask yourself these questions: • Does this require action? • Can I identify a specific use? • Is it difficult to obtain again? • Is it recent enough to be useful? • Are there tax or legal implications? If the answer is “No,” ask: What is the worst possible thing that will happen if I toss this? If you can live with your answer, toss or recycle it, and work happily ever after! (Note: These tips apply to paper and electronic files.)

2. Eliminate your obstacles. What currently prevents you from having a successful system? 3. Commit your resources. How much time, money, and human resource power are you willing to put into the project? 4. Create your system. What tools (software, existing filing systems that work well, etc.) do you currently have that will be helpful to the process? What other tools are available? What procedures do you need to apply? A crucial component is applying The Art of Wastebasketry (see sidebar) to eliminate unnecessary records. 5. Maintain your success. What procedures do you need to develop and implement so the system you create will continue to work long after the creators of the system are gone? It would be wonderful if creating an information management system was simply a matter of buying a book or hiring an expert who told you exactly what to do; however, a successful program requires people, procedures and technology. It must be supported by management, customized for the organization, and ex-

CROWN MOULDING TO INSTALL

Your ability to accomplish any task or goal is directly related to your ability to find the information you need when you need it. ecuted by everyone in the organization to succeed on an ongoing basis. Designing, implementing, and maintaining an effective information management program is the best place to start on the road to a “productive environment” organized office in which everyone can find what they need when they need it, so they can accomplish their work and enjoy their lives. Your employees will have more space to work, stop wasting time and energy searching for paperwork and get more accomplished.

Upgrade value

Minimize waste

Increase profitability

Cut down installation time visit flipface.com by alexandriamoulding.com

CONTRACTOR ADVANTAGE

november/december 2010

#doss : 4274

Client : ALEXANDRIA MOULDING Publication : Castle Contractor Advantage Item : Vertical Ad

| 21 Format : 2-1/2” x 10” Date : 15 / 09 / 10


Cover Story

B AC

s

of alternative energies

Not knowing energy alternatives can spell financial disaster for contractors as the markets shift. By Paul Welch

F

or the energy-digesting consumer, one gust of political ill wind can mean financial disaster. Every ripple in the Middle East means a spike to the price of a barrel of oil; a price jump that ripples through the entire economy, hurting industry, business and the homeowner. Multiple surveys show that consumers are receptive to, if not passionate about, not having to rely on the vagaries of the price of oil, and would consider the most common alternatives: solar, geothermal or wind energy sources. It is critical for contractors to understand the importance of being able to offer current and potential customers an alternative source of energy for their homes, factories and office buildings, says Jim Harris. In fact, Harris, a management consultant, author, columnist and former MP, who specializes in the financial business benefits from pursuing green opportunities, says contractors who do not offer consumers a green approach to energy (or every other facet of the structure under construction or renovation) are in danger of making themselves uncompetitive in a shifting market. “It is important to understand the consumer,” Harris says. “Surveys show that 80% want to deal with companies that provide green products and services, and 41% would change their buying habits to favour companies that provide green goods and services. What contractor can afford to ignore the aspirations of 80% of consumers, or the potential habits of 41%?” Harris notes that much of the public reluctance to make a significant shift to green energy stems from a mistaken belief that it is too costly. In fact, he says while there can be an added expense to adding solar panels to the roof or a geothermal heating system in the basement, those costs are offset by lower energy costs in a matter of a few years, followed by savings from the significant reduction in annual energy costs. It is important for contractors to understand and be prepared to offer energy-efficient projects, Harris says, because the inability to do so can be disastrous.

22

|

NOVEMBER/DECEMBER 2010

CONTRACTOR ADVANTAGE


photo: brand x pictures

Cover Story

CONTRACTOR ADVANTAGE

NOVEMBER/DECEMBER 2010

| 23


INSPIRED by R E A L L I F E

Become inspired by the real-life design options from JELD-WEN Windows and Doors. From superior selections of wood, vinyl and aluminum clad windows to wood, steel and fiberglass interior and exterior doors, JELD-WEN is your comprehensive source for CELEBRATING

energy-efficient, long-lasting and environmentally friendly products.

To learn more about our products and services, visit JELD-WEN.ca.

Š2010 JELD-WEN of Canada, Ltd. Reliability for real life is a trademark of JELD-WEN, inc., Oregon, USA. All other trademarks are the property of their respective owners.

55393 JW Contractor Advantage Ad May_June Resize.indd 1

4/14/10 9:50:09 AM


Cover Story

s.

or

photos: istock phots, hemera

el

“If you are putting up buildings that are not energy efficient, while consumers are saying, ‘we need energy efficiency,’ you are going to be financially crushed,” he warns. For contractors, ensuring they are comfortable discussing and offering green energy technologies to the consumer is getting easier, says Greg Bonser, chief technologist at Toronto-based Village Technologies (www.villagetechnologies.ca), which specializes in energy-efficient building design for the commercial and residential building sector. For example, he says manufacturers and distributors of green energy systems offer a variety of instructional courses on the technology and installation. As well, information courses have been offered at educational institutions such as the Ontario College of Art and Design, and Bonser intends to introduce such a course through Village Technologies in the future. As the public demand for green energy grows, Bonser says the industry has responded by refining their products. “Most ‘green’ technologies are just improving on technology that has been available for a long time,” Bonser says. He notes LED lights, which are less a drain on hydro than traditional lights, have undergone significant improvements in recent years, as has the entire solar energy industry as it improves its efficiencies through expanded research and a wider manufacturing field of the product. As well, he says energy recycling technologies such as heat recovery ventilation systems and drain heat recovery are gaining popularity and acceptance in the industry. When considering green energy, experts agree, there are three main systems: solar, wind and geothermal. Solar Power: The sun beams down to Earth enough energy to fulfill the planet’s power needs many times over. Solar power does not produce environmentally-hazardous carbon dioxide emissions; it is in inexhaustible supply. Just as importantly, in its raw state it is free. The expense is attached to turning this bounty of energy into useful electricity.

The sun’s light (indeed, all light) contains energy. Usually, when light hits an object the energy turns into heat, like the warmth felt while sitting in the sun. When light hits certain materials the energy turns into an electrical current instead, which can be harnessed for power. Old-school solar technology uses large crystals made out of silicon, which generates an electrical current when struck by light. The electrons in the silicon crystals get up and move when exposed to light rather than moving in place to make heat. The silicon turns a significant amount of light energy into electricity, but it is an expensive approach because big crystals are hard to grow. Newer materials use smaller, cheaper crystals, such as copper-indiumgallium-selenide, which can be shaped into flexible films. This “thin-film” solar technology is not as efficient as silicon at turning light into electricity. At the moment, solar energy only accounts for a tiny portion of total electricity generation, as it is more expensive than alternatives such fossil fuels. Solar power is about five times as expensive as what people pay for the current that comes out of the outlets. To become a realistically considered replacement for fossil fuels, materials must be developed that can be easily mass-produced and convert enough sunlight to electricity to be worth the investment. Solar Energy Pros: • Solar panels give off no pollution. The only pollution associated with solar panels is the manufacturing of these devices in factories, transportation of the goods, and installation. • While the production of energy from the use of fossil and some renewable fuels (wind turbines, for example) can be noisy, solar energy produces electricity very quietly. • One of the great pluses is the ability to harness electricity in remote locations that are not linked to a national electricity grid. A prime example of this is in space, where satellites are powered by high-efficiency solar cells. • The installation of solar panels in remote locations is usually much more cost-effective than laying the required highvoltage wires.

e owners.

0 9:50:09 AM

CONTRACTOR ADVANTAGE

NOVEMBER/DECEMBER 2010

| 25


T:8.125” S:8.125”

S:10.875”

Higher cargo compartment. Lower operating costs. Everything else you need in between. Flexibility and functionality are what make the Mercedes-Benz Sprinter the choice of the construction industry. We offer best-in-class cargo capacity, best interior standing height, a maximum side and rear door opening and best-in-class fuel efficiency complements of our BlueTEC V6 diesel engine. And we surrounded it all with the comfort and engineering you’ve come to expect from Mercedes-Benz. In other words the Sprinter has everything you need, for whatever you need it for. For more information, visit mercedes-benz.ca/sprinter.

The 2010 Mercedes-Benz Sprinter. Starting at $42,900.* © 2010 Mercedes-Benz Canada Inc. *Price does not include Freight, PDI, dealer Administrative fees, GST or PST.


Cover Story

photos: hemera, james wardell

B:11”

T:10.875”

S:10.875”

• Solar energy can be very efficient in a large area of the planet, and new technologies allow for a more efficient energy production on overcast days. • Solar panels can be installed on top of many rooftops, eliminating the problem of finding the required space for solar panel placement. • Although the cost of initial investment of solar cells may be high, once installed they provide a free source of electricity that will pay off over years. In some areas, like metro Toronto, homeowners or other building owners can actually produce energy to take care of their structures and sell the surplus to the municipal utility, thus more than offsetting initial installation costs. • Use of solar energy to allow the consumer to become less dependent on fossil fuel supplies. Solar Energy Cons: • The major con of solar energy is the initial cost of solar cells. Currently, prices of highly efficient solar cells can be above $1,000, and some households may need more than one. This makes the initial installation of solar panels extremely expensive. • Solar energy is only able to generate electricity during daylight hours. This means for around half of each day, solar panels are not producing energy for the home or building. • The weather can affect the efficiency of solar cells. • Pollution levels can affect a solar cell’s efficiency, a major con for

businesses or industry wanting to install solar panels in heavily polluted areas such as cities. Wind Energy: Air is a fluid like any other, except that its particles are in gas form instead of liquid, and when air moves quickly, in the form of wind, those particles are also moving quickly. Motion means kinetic energy that can be captured, just like the energy in moving water can be captured by the turbine in a hydro electric dam. In the case of a wind-electric turbine, the turbine blades are designed to capture the kinetic energy in wind. The rest is nearly identical to a hydro electric setup: when the turbine blades capture wind energy and start moving, they spin a shaft that leads from the hub of the rotor to a generator. The generator turns that rotational energy into electricity. At its essence, generating electricity from the wind is all about transferring energy from one medium to another. The amount of wind energy generated depends mostly on the size, height, type, and location of a wind turbine. Some small turbines, such as those fixed on a sailboat, generate just a few hundred watts, enough to power a few light bulbs. At the other end of the spectrum are the large, utility-scale turbines that have a capacity of three megawatts and produce in two to three hours the amount of electricity the typical family uses in one year. Most wind power turbines are still installed on land, but the future could lie offshore. Wind speeds over oceans are, on average, twice as high as over land and more reliable, making offshore wind parks an interesting but technically more challenging and expensive alternative. Improving efficiency and falling costs of turbine production and installation will make wind power more price competitive. The cost of producing utility-scale wind power has fallen by 90% in the past 20 years. According to General Electric, global prices now range between 3.5¢ and 4¢ per kilowatt hour, making wind power competitive with energy from coal, oil, nuclear and natural gas. Wind power has its drawbacks. Wind turbines, large or small, are not always welcome additions to the landscape, because many people find them loud and unsightly. They are also known to disrupt electro-magnetic communication signals. Others claim that turbines endanger wildlife, particularly birds. The biggest technical problem is that wind energy cannot be produced just anywhere; average wind speeds must be good enough to make installing a turbine cost-effective and even the most advanced turbines can extract only a maximum of 45% of the wind’s energy. Energy storage is another issue. Like photovoltaic solar panels, the amount of electricity that wind turbines produce can vary significantly with the weather. This makes it more difficult to incorporate wind power in national grid systems, which have to back up the turbines with other power sources for those times when the wind does not blow.

CONTRACTOR ADVANTAGE

NOVEMBER/DECEMBER 2010

| 27


Cover Story

28

|

NOVEMBER/DECEMBER 2010

CONTRACTOR ADVANTAGE

Heatpump (above) and geothermal unit (left).

placing a fossil fuel system with geothermal immediately cuts your household energy emissions by 50%, equivalent to taking four cars off the road. Federal and provincial governments recognize the important role that geothermal plays in reducing home energy use, and have created rebate programs to facilitate installation. Geothermal energy is considered to have the fewest negative aspects among the green energy sources; experts say it is less expensive, less invasive to the environment to access and install, and provides limitless energy.

photos: Canada Mortgage and Housing Corporation

Geothermal energy: A geothermal system uses the energy of the sun stored in the Earth to keep building occupants in comfort all year round. Even in the winter, when a blanket of snow covers the ground, the Earth’s temperature remains approximately 10º C at only 6’ below the surface. This means a steady supply of heat to keep you in comfort, even in the depths of the coldest winter. Geothermal energy relies on a series of pipes buried in the ground. An ethanol solution is circulated through the pipes to make them highly efficient conductors of heat. In the winter, the ethanol in the pipes absorbs the heat from the ground and, now warmed, the fluid is pumped back through the geothermal unit in the house. In the summer, the heat transfer process takes place in reverse. The fluid in the pipes leaves the house in a warm state, but after circulating underground, is cooled as the pipes exchange heat with the cooler earth. To move this energy throughout the structure, the geothermal unit relies on underground loops connected to the main geothermal unit installed in the structure, which is connected to the building’s forced air (or water radiator) system. Heating in winter: After the pipes have completed the heat transfer and the geothermal unit has done its work maximizing the heat value of the circulated fluid, the heat is then drawn off the heat exchanger in the unit and circulated throughout the house using the existing distribution system. Cooling in summer: In the summer, the process is reversed, as the hot air in the house is essentially absorbed by the geothermal unit that now circulates much cooler pipe fluid. The heat is transferred first to the pipes then to the ground outside before returning cooled air to the house. Geothermal pros: • One significant benefit to geothermal energy is its low-maintenance requirements; cleaning the electrostatic filter once a month is all that is needed to keep the system in good running order. • Quiet operation: Pumps quietly circulate fluid through the heat exchanger. No combustion or forcedflame noise is heard. An often-noisy outdoor air conditioning unit is not required. • Comfort: Geothermal systems eliminate indoor temperature swings and humidity changes that often occur with traditional systems. In addition, the occasional odour caused by combustion of fossil fuel is eliminated. • Long system life: Geothermal units have a life expectancy of at least 20 years. • The environment: Geothermal systems use a renewable resource, the Earth, which is efficient and non-polluting. Re-


Feature

Moulding Savings

Contractors are turning to pre-finished moulding options and MDF for faster and affordable moulding installations.

photos: alexandria moulding, ablestock

By David Chilton

T

he popularity of moulding continues to grow. There are new products, new profiles and new approaches, all of them driven by a mixture of contractor and consumer demand and innovation from suppliers stepping up to accept the challenge of this expanding market. One of the most popular developments is pre-finished mouldings. Many companies offer products that are pre-finished across much of their entire range of baseboards, chair rails, doorstops, crown mouldings and so on. Doug Macdonald, Ontario sales manager for Milton,

Ont.-based Moulding & Millwork’s moulding distribution unit, says a lot of good contractors are starting to realize the value of mouldings that come pre-finished. “I see a shift towards pre-painted products,” he says. “I see more pre-finished moulding being sold.” Moulding & Millwork’s pre-finished lineup is sold under the FinTek banner. With a professionally rendered smooth finish, all a contractor has to do is install it and touch it up where necessary. It is, says the company, an ideal choice for the professional and the handy person alike.

CONTRACTOR ADVANTAGE

november/december 2010

| 29


The tools for the best results with FinTek are a compound mitre saw with a finish saw blade and a pin nailer that will drive up to a 2” nail. FinTek moulding should be cut to length and installed; then all holes should be filled with FinTek colour matched wax fill. Visible seams and gaps can be filled with FinTek colour matched putty, and a small bead of FinTek colour matched caulking can be applied over shadow lines and seams between the wall and the moulding. A final touch up, if needed, comes from FinTek colour matched spray enamel. In total, there are more than a dozen FinTek products, including casing profiles, baseboard profiles, opening trim/architrave profiles and two profiles for crown mouldings. All are finished in Polar White and are made of recycled wood fibre. They are consistent in colour from piece to piece with no knots or warping and offer a lower overall cost compared with other finishing alternatives. On average, the company says, contractors report having saved significant time on their projects since there is no site finishing required. Saving time and thus money on pre-finished moulding is something Marianne Thompson says she has learned from contractors.

30

|

november/december 2010

CONTRACTOR ADVANTAGE

“For contractors, time is money,” says Thompson, director of corporate development for Alexandria Moulding in Alexandria, Ont. “The contractors want more profiles in the pre-painted lines. They can put up the trim and walk away.” Market research, Thompson explains, found that 75% of buyers were willing to pay 20% more for pre-finished moulding, and 20% of them were willing to pay a whopping 50% premium. Alexandria’s pre-painted lineup is called the DecoSmart Collection and was introduced in 2009. Thompson says DecoSmart offers a dozen profiles for baseboards, casing, chair rails and doorstops. Painted in “universal white” acrylic, the formaldehyde-free MDF moulding has been tested with 20 freeze-thaw cycles, 240 hours of UV exposure, is stain resistant and can be repainted by the contractor or customer if they desire. DecoSmart also comes in a complete package: a touch-up kit, caulking, trim paint, filler and a scraper. Another new entry from Alexandria is The M Collection, introduced this year. With clean lines and a DecoSmart finish, the mouldings are eco-friendly MDF with no added formaldehyde in the substrate. The M Collection, like the DecoSmart range, has been formulated to be handled similarly to Alexandria’s prime product but with both there is no special packaging required. The 12 new profiles in white will not yellow in direct sunlight and may be touched up with

photos: alexandria moulding, moulding and millwork

Feature


photos: alexandria moulding, comstock

Feature

existing DecoSmart accessories for a perfect colour match. “The M Collection has had an excellent reception from contractors and consumers,” says Thompson, again noting that contractors will pay more for product if it means they can complete a project faster. Doing it faster and more efficiently, that is the name of the game, and a new product from Alexandria was conceived with just those aims in mind. Crowns might be considered the kings of moulding. They are above everyone, for one thing; for another they are likely the trickiest to install given the number of precise cuts that have to be made. That means an enthusiastic welcome for the Flip Face, a reversible crown that has an identical profile on both sides so

the installer no longer has to set or reset his saw to make inside or outside corners. All he has to do is turn over the moulding and start cutting. Another labour-saving approach to moulding is the use of a kit. They come in many sizes and designs, from the most modern to the most faithful reproductions of practically any era from the Georgian onwards. One of the most popular uses of kits is for wainscoting. This panelling made of wood, MDF or other material provides an attractive wall treatment and still discharges its duty as a barrier against any damage caused to the walls themselves by everyday use. Until not so long ago, wainscoting was either fake trim applied to the wall or custom panelling that cost a fortune. Those practices are now a thing of the past. Consider, for example, Elite’s Wall Panelled Wainscot. It fits together easily and comes in prerouted 8’ kits with finished heights between 38” and 72” and can be installed right over the existing wallboard using the existing wall as the middle panel. continued on page 34...

CONTRACTOR ADVANTAGE

november/december 2010

| 31


Green Friendly:

Tips And Advice For The C LEED Canada NC 2009 The Canada Green Building Council or CaGBC has announced that registration for LEED Canada for New Construction and Major Renovations (NC) 2009 and LEED Canada Core and Shell Development (CS) 2009 opened June 21, 2010. These new rating systems offer many advantages, including: • Re-weighted credits: the number of points that may be earned for each credit has been re-evaluated using a more scientific approach, resulting in greater emphasis on preventing climate change. • Familiarity: the majority of credits have not substantially changed.

32

|

NOVEMBER/DECEMBER 2010

CONTRACTOR ADVANTAGE

• Faster certification: the audit component of the certification process has been eliminated, and streamlined compliance pathways are available for some credits. Projects registering as of June 21, 2010 will be registered under the 2009 versions, while projects registered prior to this date may switch to the new rating system. “The built environment has a profound impact on our natural environment, economy, health, and productivity,” the council says. “Break-throughs in building science, technology and operations are now available to designers, builders, operators and owners who want to build green and maximize both economic and environmental performance. “The green building movement offers an unprecedented opportunity to respond to the most important challenges of our time, including global climate change, dependence on non sustainable and expensive sources of energy, and threats to human health. The work of innovative building professionals is a fundamental driving force in the green building movement.”


he Contractor Professional NC 2009 Q&A How can I learn more about the new rating systems? The New Construction Technical Review workshop has been updated to LEED Canada NC 2009. See the CaGBC website (Education section) for further details. In addition, the CaGBC will be offering a webinar to present an overview of the differences between the previous versions and the new 2009 versions. Will I be able to switch a previously registered project to LEED Canada NC 2009 or LEED Canada CS 2009 after these versions are launched? Yes, projects registered under the current versions of the rating systems will be able to switch to the new versions. Applicants are encouraged to contact CaGBC Customer Service if they wish to be switched to the 2009 versions, but are cautioned that once the project is upgraded to version 2009, the project may not be converted back to the previous version.

Will I be able to use LEED Canada 2009 pathways for a previously registered project without fully upgrading to new products? Yes, projects registered under the current versions of the rating systems will be able to use some pathways from LEED Canada NC 2009 and LEED Canada CS 2009 without fully upgrading to the new rating systems. A table of allowed substitutions is provided on the CaGBC’s website. Not all new pathways will be acceptable for previously registered projects due to the change in individual credit weightings. However, the CaGBC recognizes that some applicants will want to use the alternative credit pathways provided in the 2009 product line but are unable to fully upgrade due to the stage of completion of the project. This methodology provides flexibility to LEED Canada users. Source: CaGBC

CONTRACTOR ADVANTAGE

NOVEMBER/DECEMBER 2010

| 33


...continued from page 31

Elite’s Flat Panel Wainscot kit is in the Flat/Shaker style in paint grade poplar, oak, maple or cherry and can be used to cover up damaged, unfinished or textured walls. Other moulding that

34

|

november/december 2010

CONTRACTOR ADVANTAGE

is popular in kit form includes fireplace surrounds. Ferche Millwork Mantel Kits, for example, have been assembled in one box with the wooden components necessary to fit a maximum opening that is 39” high and 52” wide. In short, kits for a good many moulding jobs can be found, not just wainscoting and fireplaces. Mouldings, of course, are not new. The Greeks of antiquity were the first to decorate their buildings with wood mouldings, curiously enough, even though popular imagery suggests that they used stone for everything they put up. The Romans followed the Greeks’ basic shapes with their own refinements that have trailed down over the centuries and which find expression in the thousands of moulding profiles available today to every market and for every purpose. However, the first mouldings were not just for decoration. Remember, says Macdonald, the original mouldings were used to cover gaps and joints. The baseboard was and still is used to hide the gap between the wall and floor. During the Georgian period from 1714 to 1830 other practical functions for moulding emerged. Then it was fashionable to leave dining room chairs away from the table and against the walls so chair rails were devised to protect them. During the reign of Queen Victoria, chairs were left around the dining room table, as now, then the chair rail disappeared, although it reappeared as a decorative item with the introduction

photos: alexandria moulding, moulding and millwork

Feature


photo: moulding and millwork

Feature

of the Arts and Crafts movement and the onset of the later Edwardian era. Of course, when moulding is being considered these days aesthetics are paramount. The profile is crucial but so is the material used. Here MDF is in the ascendant. Macdonald says at least 50% of his shelves have the wood by-product on them and that the general moulding market is moving to MDF. “It is cheaper and engineered consistently,” he says. “Toleranc-

es are very low.” Thompson has another, slightly different take on the use of MDF. “MDF has to do with price points,” she says. “Contractors are really sensitive to that.” Certainly, and that is where a problem may arise in future. Chile is the largest producer of MDF in the world but the massive earthquake there in February this year may affect prices, notes Thompson. Still, there is plenty of wood available, Macdonald continues, although “wood is wood, there are things that can go wrong with wood.” Nevertheless, wood moulding produces a far crisper profile than MDF, it should be said, since that material is softer and the detail of the profile is harder to create. Further, says Thompson, the next product to make a splash, particularly in Alberta and British Columbia, will be Alder. Beyond wood and MDF, other materials, while available, are not nearly as popular. Plaster may work in the southern U.S. but it will not take off here, Thompson remarks. That may be the case with that particular product, but just as the significant growth of MDF was driven by contractor demand for less expensive, more versatile moulding, so too might polyurethanes, expanded polystyrene (commonly known by its Styrofoam brand name), vinyl and aluminum. All are durable, can be used indoors and out, and are inexpensive to buy and install.

CONTRACTOR ADVANTAGE

november/december 2010

| 35


Arrow® has the Power House of Professional Hammer Tackers. These rugged tools with their sleek design allows for hours of comfortable use. With heavy duty all-steel construction and precision lock rear loading these hammer tackers can hold two full strips of T50® staples in 3 sizes. Our latest model, the HTX50™ features: • A knuckle guard to help protect hand from injury • Slip guard to keep tacker firmly in hand • Surface guard flange to reduce damage to work surface But, don’t take our word for it. Try them the next time you need to tackle one of the following projects: • Roofing Underlayment • Housewrap • Insulation • Vapor Barrier • Carpet Padding Installation

Visit us at www.arrowfastener.com for more information on this and other great Arrow tools.

Arrow Fastener Company, Inc. USA Tel: 201.843.6900 Canada Tel: 514.321.3983 UK Tel: 44.208.686.9180

www.arrowfastener.com © 2009 Arrow Fastener Company, Inc. Arrow® and T50® are Registered Trademarks of Arrow Fastener Co, Inc. AD-0156 • REV909


se of

ers.

Feature

eir

rs

eavy

and

0™

Books

r it.

by the

The right accountant and an understanding of a few tax rules can improve your bottom line. By John G. Smith

g tion

A

s a skilled carpenter, Kraco Carpentry and Contracting’s Rudy Kraayvanger knows the importance of measuring twice and cutting once. Every successful job comes down to recording accurate information, and applying the right skills to the task at hand. The Bowmanville, Ont. contractor expects his accountants to commit to the same level of detail. Contractors can turn to their accountants for support well beyond the filings of tax season, he stresses, noting how his chosen firm offers ongoing business advice.

om on eat

photo: creatas

Inc.

arks

• REV909

CONTRACTOR ADVANTAGE

NOVEMBER/DECEMBER 2010

| 37


© 2010 CertainTeed Corporation

delivers superior performance, around the corners and down the stretch

INSULATION

• Minimize the impact of overdriven fasteners. • Resist sagging, even in the highest humidity.

• Prevent delaminating. Agency: Brickworks Communications Inc. 905-632-8772 Artist: Heidi Gemmill x112 Client: CT270 GR Performance Car BC E Ad R3 • PDF

Only CertainTeed GlasRoc® Sheathing offers fully embedded glass mat technology, delivering advanced performance in every way. Count on GlasRoc’s exclusive, patented EGRG™ (Embedded Glass Reinforced Gypsum ™) technology to:

• Provide the tightest bending radius of any glass mat sheathing.

For flat-out performance, no one delivers like GlasRoc®.

GYPSUM

CT270 GR Performance Car E Ad R3.indd 1

6/3/10 1:22:08 PM


0 1:22:08 PM

The support for those with apprentices does not end there. “I did not go to school for economics or business ... I use them to teach me. I can say, ‘I do not understand this part of payroll The Ontario Apprenticeship Training Tax Credit, for example, is a refundable credit equal to a defined percentage (35% to 45%) deductions,’ and ‘what does that mean?’” It is why Chris Pierce, a partner at Hobb and Company Char- of the eligible expenses incurred for an apprenticeship. “Aftered Accountants and Tax Specialists, suggests that businesses ter March 26, 2009, the maximum credit for each apprentice is like Kraco should carefully weigh the capabilities of different firms $10,000 per year to a maximum credit of $40,000 over the first 48-month period of the qualifying apprenticeship,” Shortt says. before choosing an accountant to handle the books. “When the contractors call, will they have someone getting Even though the credit was available earlier, it involved lower limback to them in short order?” he asks. “Sometimes, people think a its. The eligible expenses themselves can include salaries, wages or smaller firm will offer personal service. If it is a one-man shop, they related fees paid to an employment agency. are doing everything. Sometimes they are busier.” This year offered a perfect example of calls that were not limited to tax time. Contractors in Ontario were suddenly wondering about the impact of a merger in the Provincial Sales Tax and Goods and Services Tax in favour of the newly formed Harmonized Sales Tax. An accountant will also need to have a clear understanding of the financial rules that are specific to contractors. There are nuances to every business, after all. Pierce, for example, refers to the needs to report relatively small payments to sub-contractors. A T5018 slip needs to be filed whenever a sub-contractor is paid more than $500 a year including GST and PST. The requirement applies to virtually every service, from repairs to demolition, modification and removal, and the document needs to be submitted within six months of the end of the reporting period. The cost of failing to do this can add up. Penalties for not filing any individual’s slips are worth $25 per day, up to a maximum of $2,500 per slip. “It is trying to stop the cash business,” Pierce An accountant will also need to have a clear notes, adding that the slips do not need to be submitunderstanding of the financial rules that are ted to the sub-contractors themselves. “When you are looking at it from the CRA (Canada Revenue Agen- specific to contractors. There are nuances to cy) perspective, this is one of the higher audit areas.” Contractors may also want to take the time to read every business, after all. the IT-92R2 Income of Contractors interpretation bulletin, which outlines the different ways that they Some options will vary from one year to the next. If a contraccan invoice and record income for all structures. “This is a good starting point for anyone getting into the build- tor buys computer equipment for the business between Jan. 27, ing contracting business to get a handle on when income is re- 2009 and Feb. 1, 2011, the company will be able to receive a 100% quired to be included in the fiscal year for tax purposes,” adds Capital Cost Allowance. “Yes, you can write off the whole amount Cristina S. Shortt of Ritchie Shortt and Tully LLP Chartered Ac- in the year of purchase,” Shortt adds. Meanwhile, the federal tradesperson’s tools deduction offers countants, which counts many contractors among its clients. There are several credits available to those in the business employed workers an annual deduction of up to $500 toward of contracting. Through the Apprenticeship Job Creation Small the cost of new tools, but they will need to have spent more than Business Tax Credit, for example, employers can earn Investment $1,000 on the tools and purchased them after May 1, 2006. Accountants can even play a role in helping contractors with Tax Credits on their Canadian income tax equal to 10% of the eligible salaries and wages paid to eligible apprentices to a maximum the invoicing of complex projects, offering a value-added service credit of $2,000 per year per apprentice. “The credit reduces fed- that could help those who are paying for the work. Shortt, for eral taxes payable or can be carried forward if the company has example, refers to the need for detailed invoices. “The deductibility and Capital Cost Allowance (CCA) rates differ,” she explains. losses,” she adds.

Agency: Brickworks Communications Inc. 905-632-8772 photo: hemera Artist: Heidi Gemmill x112 Client: CT270 GR Performance Car BC E Ad R3 • PDF Publication: Castle Contractor Advantage 8.125” x 10.875” + bleed 4 colour, June 2, 2010

© 2010 CertainTeed Corporation

Feature

CONTRACTOR ADVANTAGE

NOVEMBER/DECEMBER 2010

| 39


Feature Accountants can even play a role in helping contractors with the invoicing

photo: hemera

of complex projects.

“Generally, landscaping is 100% deductible. Walkways, leasehold improvements, building additions have different CCA rates. If significant improvements are not being made, then some of the expenditures may be considered repairs and maintenance, which are 100% deductible as well.” While there are opportunities that should not be ignored, contractors should also be careful about some potential traps. In Ontario, contractors and their employees should all be registered under the Workplace Safety and Insurance Board (WSIB), Shortt notes as an example. There are exemptions for self-employed owners, or the directors and officers of an incorporated company. “If you employ your spouse or children, make sure that you pay WSIB premiums on their wages. Occasional labour is also included for WSIB purposes. In particular, contractors need to be aware that they could be considered a principal: an employer who retains contractors to execute work. “The principal is liable to pay premiums on amounts paid to contractors or sub-contractors if they do not provide the principal with a Clearance Certificate. Get these right away. Once you are being audited by WSIB, it is difficult to locate the sub-contractors that you may have used three years ago, and you will have to pay WSIB premiums as well as interest on the payments made to those sub-contractors,” she says. Pierce also stresses the need to track the smallest expenses, even if it is limited

as a tube of caulking to complete the final stage of a job. “All that stuff over a year is going to add up,” he says, even referring to the smallest items that might be paid with cash in a contractor’s pocket. “Make sure those receipts are getting picked up.” The accounting and management of the business represents a real cost as well, and it needs to be incorporated in quotes along with an acceptable profit margin, Kraayvanger continues. “If it cost me 3% of my sales to pay my accountant, whatever I estimate I better make sure I add 3% to pay my accountant.” The figures will also help to offset the cost of a bad estimate, when a job takes slightly longer than expected. Pierce, meanwhile, refers to the importance of recording financial information on a regular basis and viewing the related reports as often as possible. “Unless you are keeping track as you go on, you might be taking a bath doing a bathroom renovation,” Pierce says. A sole proprietor who waits three to four months after a year end before adjusting business practices could be in trouble.

I N N O VAT I O N BYDESIGN TRADITIONAL AT HEART, Ashfield is inspired by wide open prairie spaces and fond memories of yesteryear. Innovative by design, Ashfield reduces water flow by 30% while delivering 100% performance. At Price Pfister, we design innovative products that push the boundaries of form and function well into tomorrow. Whether you live in a field stone cottage or a sleek urban tower, Price Pfister is designing something just for you.

PricePfister.com

CONTRACTOR ADVANTAGE

NOVEMBER/DECEMBER 2010

| 41


With its standout protection, strength and impressive architectural design, why choose anything but IKO Cambridge Series shingles?

CAMBRIDGE LT & 30 ARCHITECTURAL

SHINGLES

The IKO Advantage.

The larger the shingle, the bigger the savings. 路 A larger shingle means increased profitability - you save time and labour by using fewer shingles and fewer nails. One of the heaviest asphalt-based shingles on the market. 路 Laminated shingle construction provides superior resistance against thermal cycling, tearing and high wind. For additional information on our full line of premium roofing products please call: Eastern Canada 1 - 888 - 766 - 2468, Western Canada 1 - 800 - 661 - 1034, or visit our web site at: www.iko.com


Feature If a contractor buys computer equipment for the business between Jan. 27, 2009 and Feb. 1, 2011, the company will be able to receive a

photo: istockphoto

100% Capital Cost Allowance. “You need to be analyzing this constantly throughout the year,” he says. The good news is that most off-the-shelf accounting software will make that possible. Kraayvanger stresses the importance of entering bills at least once a week, so the year end tax deadline will not lead to panic. All of the Kraco jobs are also based on contracts that specify individual payment cycles, including invoices for initial, progress and final payments. “If 50% of the work is done I should have 50% of the money,” Kraayvanger says. He also submits any of these invoices in the days prior to his year end, to ensure that there is a clear distinction between work done in one tax year or the next. “Sometimes your year end does not get finalized until six months after year end,” he observes. Kraayvanger suggests that an above-board approach to accounting can also help to clarify any negotiations with clients. He

knows he will never be trapped by a discount-seeking client who insists that Kraco did another deal for cash and did not charge sales tax. It simply never happens. Ultimately, the organization of all these financial records will be vital if government officials ever come calling for the purpose of an audit, Pierce adds. “If you get audited and the books are nice and clean, it is going to be a simpler process.”

CONTRACTOR ADVANTAGE

NOVEMBER/DECEMBER 2010

| 43


Feature

Door

Fortunes

The biggest trend in interior doors is the move by manufacturers away from the sale of simple door slabs to increasingly popular, fully constructed, pre-hung door systems. By Lawrence Cummer

44

|

NOVEMBER/DECEMBER 2010

CONTRACTOR ADVANTAGE

photo: moulding & millwork

T

he doors inside a home help to frame a visitor’s first impression of the entire room. A fancy new door installation can cost effectively bring that ‘wow’ factor that creates happy customers in a matter of minutes. At the same time it requires a bit of client education. “The biggest challenge with doors is many people consider them an afterthought,” says Peter Branidis, sales manager at Moulding and Millwork. “For contractors there is a big focus on lumber, drywall and shingles, but when it comes to doors it often becomes a case of ‘whatever is easiest.’” Branidis says that is a mistake for contractors can use this often overlooked area to differentiate their business. More impressive looking interior doors are increasingly becoming another important selling feature, not unlike hardwood floors, granite countertops or stylish faucets, only they can be offered much more cost effectively, he says. Mike Piggot, National Account Manager at Can-Save, agrees, but says that times are changing and it is all starts with the homeowner. Homeowners, for example, who have already had new floors or moulding installed, now see that common-looking six-panel door no longer provides the look they want. As well, in the last five years homeowners have a tendency to change up door hardware from tradition brass-coloured doorknobs and hinges, prompting them to replace the door itself in order for it to be equally decorative.


Feature

CONTRACTOR ADVANTAGE

NOVEMBER/DECEMBER 2010

| 45


Vicwest Decking Contractor Advantage ad:Layout 1

“It used to be that people would say, ‘a door is a door is a door.’ Now people look at doors more as décor, and this is happening because more renovation television shows show people doing things differently in their homes,” Piggot says. Cost effective change: Piggot says an impressive change in the overall look of a house can be made affordably by simply choosing more stylish doors, and contractor costs average only around $50 per hollow core door for a wide spectrum of sizes and styles. He says the cost of switching twelve doors in a home, making a major impact throughout the house, is similar to what many homeowners would gladly pay to add laminate flooring to a bedroom or two. Changes do not have to be so drastic to make a big impact. “You can make a pretty big impact in the home by changing up just a few doors, and what is it going to cost? $100, maybe $300?” he asks rhetorically. Piggot says the cost delta between new doors of different styles, or even sizes, is typically marginal. For contractors this is an opportunity to up-sell during other renovations or bring to their customers more options that, without breaking the bank, reinforce the contractor’s reputation for quality and workmanship. Pre-hung for ease: Possibly the biggest trend in interior doors is the move by manufacturers away from the sale of simple door slabs to increasingly popular, fully constructed, pre3/15/10 4:30 systems. PM Page 1 hung door

No Fibers. No Fillers. No Compromise.

New WeatherReady Solid Core PVC Decking, Trimboard and Mouldings TM

New WeatherReadyTM Building Materials offer a revolutionary cellular formulation that assures high-strength, consistent density, and nothing to come apart or delaminate. Available in common building dimensions, the WeatherReadyTM family of materials are lead-free and manufactured to strict industry standards and are ARCAT green compliant for sustainable design. Ask for it at your local Castle Building Centre or visit the Vicwest website.

Available in these popular colours. Wood grain finish.

46

|

w w w. v i c w e s t . c o m

NOVEMBER/DECEMBER 2010

CONTRACTOR ADVANTAGE

photo: jeld-wen

Feature


Feature

photos: jeld-wen

work, can shorten a contractor’s installation time from hours to minutes, according to Branidis. “We have basically taken the work out of it.” Quality comes first: Contractors should remind their customers that quality is an important consideration. Warranties can be used to determine a degree of quality, says Piggot, who notes that some Jeld-Wen doors, which Can-Save uses in their door systems, have five-year warranties. Poor quality, or poor material choices, can also create problems during installation. An MDF door jam will not have memory if a hinge needs to be, for whatever reason, removed and reapplied. A better option for the jam is finger-jointed pine or clear pine if a finish is to be applied. “When you look at a six-panel door, not all doors are created alike in quality,” Piggot says. Contractors must educate consumers, he adds. As an example, a marginal increase in cost (perhaps as little as $5 per door) can make a big difference in the final durability over its lifetime. Improperly made doors are more likely going to have warping issues, and hinges are going to be more likely to fall off from frequent use. In the end, homeowners might mistake a poor quality door as a bad installation. Since it can sometimes be difficult for experienced contractors to spot differences in quality, Piggot suggests selecting well-recognized name brands over slightly cheaper foreign imports. As well, homeowners are going to read“When you are installing a pre-hung door, all the work is done for you,” says Lee Whitaker, vice-president at Barrie Trim and Mouldings Inc., a firm that installs Moulding and Millwork door systems. The advantage of a pre-hung system is speed and ease of installation, but they also have fewer areas to run into potential problems, such as matching older hinges or frames with new door slabs. While this makes them a better option for do-it-yourself types, there are still enough aspects that could make it tricky for an average homeowner, but a simple job for a contractor. Whitaker says contractors need to make themselves aware of different full-system options that exist from different manufacturers and different specialty shops and retailers. Differences exist, for example, between the pre-hung (sometimes called Uchannel kits) and fast-fit kits. Pre-hung systems, like those offered by Moulding and Mill-

CONTRACTOR ADVANTAGE

NOVEMBER/DECEMBER 2010

| 47


ily accept a well-known local brand. “There is a difference between an imported door and a fully domestic-made door and we see it everyday. Sure the price is competitive and the price looks good on the surface, but we know the quality of that door just does not measure up.” What is at the core: Contractors can also help homeowners make an important decision between a hollow core and solid core doors. Traditionally, Canadian consumers have only looked for hollow core interior doors, while in the U.S. using solid core doors for bathrooms and bedrooms has been more popular in recent years. This trend is coming to Canada, Branidis says. Solid core doors have better sound-muting capability, and associated privacy, and they have a weightier look and feel. While solid core cost more, they can be easily matched up with the other hollow core doors throughout a home. It is all about the right mix

48

|

NOVEMBER/DECEMBER 2010

CONTRACTOR ADVANTAGE

of each. “Go hollow for the closets; solid for bedrooms and bathrooms,” Branidis recommends. “From a materials perspective, that is a huge area of opportunity, an area to add value and for a contractor to make more money.” Branidis says for the cost difference to a contractor or builder’s

photos: jeld-wen

Feature


photos: moulding & millwork, jeld-wen

Feature

material budget is only about $300 to offer solid core doors for three bedrooms, two baths and a powder room, which could be a drop in the bucket when talking about the overall value of a new home or renovation project, he says.

Opening up to style: The most common interior door is a simple, six-panel slab, but there is now an abundance of variety for contractors to present to homeowners. Of course, trends are always changing and staying on top of them can be a real business differentiator. “The industry changes very quickly and we need to change with it,” says Whitaker. “For example, 10 years ago textured grain on doors was in fashion, but today that is passé. Now anything with smooth finish is more popular.” Also increasing in popularity are French doors. Here contractors should pay special attention to the hardware. Colour hinges have become more popular, says Whitaker, who adds that brass is a thing of the ’80s and ’90s. With French doors, try to ensure that the mullions dividing the window panes and the door hardware match for a more put-together appearance. Neither homeowners nor the average general contractor is aware of all the options that are out there, Whitaker says, and contractors need to better educate themselves and ultimately consumers by visiting show rooms, and scouring the Web and retail catalogues. Sizing things up: Trends that start with the front door tend to, over time, find their way through the house and one of these is taller, over-sized doors. In homes where they can fit, having 8’ tall doors throughout the first floor is becoming a popular option among homeowners. Builders are also offering them in new homes, to better sell the new property. Like many style issues around home renovations and improvements, it is all about keeping up with the Joneses, Piggot suggests. In that way bigger is better, or at least more impressive. Like so many other style elements, oversized doors are a really affordable way to visually add value without a lot of cost. Moulded doors of different sizes and styles typically have very similar, if not the same price, he says, because six-panel doors have become such a commodity. “Whether you are doing a new renovation or building a home, providing more options for quality doors demonstrates that you are giving more value to the consumer when really, in a lot of cases, the doors are selling for the same price,” says Piggot.

CONTRACTOR ADVANTAGE

NOVEMBER/DECEMBER 2010

| 49


How To

50

|

november/december 2010

CONTRACTOR ADVANTAGE


How To

Ceilings worth looking up to Contractors can raise the style quotient and value of any home with a well-planned installation.

photos: armstrong world industries, alexandria moulding

By Nestor E. Arellano

I

n many homes you are likely to find that contractors and owners have lavished attention on floors, walls and other aspects of a building, but seem content to leave the ceilings nearly untouched. This is unfortunate. Ceilings, much like blank canvases, are waiting for the right master to turn them into a stunning work of art. A wise contractor or builder can easily elevate the style of a home and raise its value by thousands of dollars with a few well-placed finishing touches to a ceiling. Ceiling types: Drywall ceilings are the most common type of ceiling choice for residential building. Many homeowners favour the look of the plain drywall, but also prefer it because it is easy to install, blends well with any dĂŠcor and is relatively cheap. It typically costs $2 to $7 per square foot to hang, tape, texture and prime drywall ceilings. Headroom can be a big factor for many ceiling installation projects. Drywall satisfies this need for headroom, losing only about one-half an inch since it can be fixed directly to the joists. CONTRACTOR ADVANTAGE

november/december 2010

| 51


5934_FMXfamily ad_ContractorsAdv.pdf

C

M

Y

CM

MY

CY

CMY

K

5/4/10

12:27:48 PM


photos: armstrong world industries, cgc inc.

How To

For many basements and older homes a drywall ceiling is the ideal option. A critical drawback of drywall ceilings is that they cover electrical wires, ductwork and piping, making it difficult to access these components when repairs or upgrades are needed. Suspended or drop ceilings, on the other hand, provide easy access to electrical and plumbing elements in the ceiling. These ceilings consists of 2’x4’ foam rectangles or the newer 2’x2’ tiles, which are held together on a suspended grid system usually made of light metal or vinyl. When electrical wiring or plumbing needs to be accessed, the tiles can easily be removed and reattached. Tiles are typically made of composite wood fibres. Some tiles are washable others can be painted, while some models are manufactured with decorative textured patterns and come in different colours. Ceiling tiles generally cost between $2 and $8 per square foot. The acoustic and fire-resistant properties of these ceiling tiles are another plus, according to John Hudson, country manager for Canada at Armstrong World Industries. “The sound deadening property of suspended ceiling tiles make for a more pleasing home atmosphere.” These acoustical properties are measured with two ratings: The Noise Reduction Co-efficient (NCR) and the Ceiling Attenuation Class (CAC). The NCR measures how much noise is absorbed when sound waves hit the surface of the ceiling tile. There are tiles with an NCR rating of up to 80%. The CAC measures how well the tile blocks the transmission of

sound through it. The highest CAC ratings range from 40 to 44. “Ceiling tiles also have fire resistant properties,” says Scott Mahony, product manager for CGC Inc. a Brampton, Ont.-based provider of ceiling tiles and suspension systems. CGC, for instance, offers ceiling tiles that meet the two life safety ratings: flame spread and fire resistance. Tiles marked Class A (the best fire rating possible) do not continue to burn or smolder after a test flame is extinguished. Ceilings are also tested for endurance to fire exposure for a given time period. The ratings are measured in hours, and many tiles have a fire exposure rating of one hour. Wood ceilings provide a rich, natural beauty that can be adopted to provide an old world formal flair or rustic charm. “Exposed heavy beams are back in vogue,” says Joe Peltzer, director of sales and marketing for Nicholson and Cates Ltd., a Burlington, Ont.-based supplier of lumber products. The company offers Douglas fir, spruce, pine and western red cedar timber as well as Baltic birch, poplar and spruce panels. Tongue-and-groove wood panels can be stained or come pre-finished. Peltzer says exposed beams and wooden panels enhance angled or high cathedral ceilings. Wood remains the coveted choice for beams and ceiling panels, but contractors can also help clients save money by pointing to some MDF, particleboard, wood veneer or plywood options, Peltzer suggests. For wood ceilings, beadboards have recently made a comeback. Beadboards are tongue-and-groove panels that come in 5” x 84” strips of wood, fibreboard or wood veneer laminates. Prices range from around $6 to more than $20 per square foot. Tin ceilings were introduced to North America in the late 1800's as an affordable alternative to the exquisite plasterwork seen in European homes. Thin rolled tin plates with embossed designs were massed produced from 1839 to 1901. Today, Brian Greer’s Tin Ceilings in Petersburg, Ont. is one of the few specialty companies handcrafting these 2’ x 2’ tin panels. The tiles can be glued to drywall or nailed to wood or drywall ceilings and can even be fitted to drop ceiling systems. “Tin panels are built to last and offer a very unique look that emulate old plaster designs with a more varied choice of colours and finishes,” Greer says. The available finishes include bright tin, bright brass, bright copper, bright chrome, antique pewter, antique copper, antique

CONTRACTOR ADVANTAGE

november/december 2010

| 53


ExtraordinaryCURB APPEAL Care-free style that makes a bold statement! • LIFETIME FADE-RESISTANT  WARRANTY Your home will look just as incredible as the day your siding was originally installed!

• MAINTENANCE-FREE Enjoy your home without worrying about painting, peeling or staining.

• ARCHITECTURALLY  APPROVED COLOURS Extensive offering of unique colour options!

MITTEN INC. . . EVERYTHING YOU NEED FOR EXTRAORDINARY CURB APPEAL!

w w w . m i t t e n v i n yl . c o m • Vinyl Siding • Accent Siding • Tools • Accessories • Shutters • Aluminum • and More •


How To

L

t nt!

ANT 

he day

photo: Greer's Tin Ceiling

!

brass, solid copper and gold. The panels can also be powder painted in any colour. The tin panels are also cheaper to produce and easier to ship than plaster, he says. Tin tile costs around $3 to $4 per square foot. Greer’s designs grace homes, and also churches, museums, courthouses and bars all over Canada and the US. There are also many faux tin panels made of PVC that cost around $1.60 to $3 per square foot. Pre-planning the install: The key to a well-executed ceiling installation lies in pre-planning, says Mario Kyriacou, principal of 360 Degrees Building Inspections in Toronto. “It all begins with the contractor consulting with the builder or owners to determine their requirements,” he explains. This will determine what type of ceiling will be built, what design and styles to follow and what materials to purchase. The veteran building inspector also says that contractors need to familiarize themselves with the latest buildings codes. For example, electrical junction boxes in between joists cannot be per-

manently covered over with drywall; this is dangerous and against code. Before installing the ceiling, contractors need to make sure that other services such as electrical and plumbing fixtures are already in place. “Make sure there is easy access to these fixtures even after the ceiling is installed,” says Kyriacou. In addition, nail down wood panels using 16” on centre spacing,” says Peltzer, which will prevent the panels from warping. Some installers of drop ceilings also often neglect to “square” their suspension grids, says Hudson. “Making sure your grid is square reduces the need to cut your tiles in odd sizes or shapes and make for a better all-around look.” High style on a low budget: Even plain drywall ceilings can be spiced up and made to look expensive with the proper choice of mouldings and trim, says Nick Lansky, manager at Alex Moulding and Design Group in Toronto. Crown mouldings, ceiling medallions and cornices add architectural finishes to otherwise bland ceilings. These emulate intricate plaster designs and carvings, but at a significantly lower cost, easier installation and they can be painted or stained to suit any taste. Coffered ceilings were waffle-like design devices used by ancient Romans as grids to spread out the weight of heavy marbles and stone. Wood and MDF panels that reproduce the look of antique coffered ceilings are used in many residences to “open up extra room and give it a sense of elegance,” Lansky says. MDF and engineered wood products are also used to make decorative faux wood beams that are cheaper and lighter than solid wood beams. Contractors can save homeowners as much as 50% on material by choosing MDF alternatives. Taking the extra effort to finish ceilings with style will not only help contractors to up-sell their labour, but also assist homeowners in increasing the value of their property.

CONTRACTOR ADVANTAGE

november/december 2010

| 55


Feature

Sub-floor Selections They may sit out of sight, but that does not mean a contractor should ignore these all-important layers. By John G. Smith

photo: comstock

C

ontractors and their customers can spend countless hours struggling between one flooring option and the next, or even discussing the subtle differences in colour that might exist. The sub-floors and underlayment that will sit out of sight deserve more than the afterthought they usually get, because the choice and installation of these all-important layers will enhance a final project in more ways than one. Different options can improve insulating values, deaden the noise passed down from floors above, and protect the installed flooring from the creaks, groans and cracks which can lead to costly callbacks. The options are particularly important in the lower levels of a home. Up to half of today’s basements show signs of damage from high humidity, the Canada Mortgage and Housing

Corporation notes. Few experienced contractors will be surprised to find the signs of moisture in a seemingly dry basement. A relatively easy inspection process proves if the issue exists. Attach 2’ x 2’ sheets of polyethylene in several areas of the concrete floor, with a strip of tape covering every edge, and leave them in place for three days. If any moisture is found under the sheets after that, the surface will need the help of a sub-floor before any flooring project can be completed. At the very least, a combination of plywood or OSB sheets with furring can be used to establish a level surface, while a high-density polyethylene sheet will provide the moisture and vapour barrier. The quality of that sheet will also make a difference. A low-density polyethylene is more prone to rips, and it falls short as a barrier to radon gas.

CONTRACTOR ADVANTAGE

november/december 2010

| 57


The planning for a sub-floor is not limited to the choice of material. When a project reaches right down to the joists, for example, installers might need to complete some limited sanding, shaving or blocking to establish a level surface for anything they want to install. The sub-floor that sits on top will certainly need to be as smooth as possible when creating a layer that will be covered in something like a vinyl or linoleum. Any imperfections in the sub-floor for one of these projects will “telegraph” through to the surface of the resilient flooring, leading to unsightly dents and divots. Even the strands in an oriented strand board (OSB) can begin to appear in the soft flooring above it. The damage is not necessarily limited to being skin deep. Combined with some pressure up above, the seemingly subtle drops can transform into rips and punctures. The choice of sub-floor will also need to consider the weight of things that will be placed on the surface above. While a plywood sub-floor can be compressed by the weight of appliances

in a kitchen or laundry room, for example, a surface made of a Fiberock will offer some added support. The sheets made of cellulose and synthetic gypsum deliver as much as 60% added resistance to the higher weights, in addition to resisting water, mold and moisture alike. The surface of this family of sheets is already smooth, and the seams between each panel can be filled with a thinset such as Ardex. An added advantage is that Fiberock can be cut with ease. Usually it requires little more than a couple of slices with a utility knife

In the next issue of

Contractor Advantage • Lumber Trends 2011 • Millwork • Green Materials Advancements • Kitchens • Countertops • Accounting Tips

58

|

november/december 2010

CONTRACTOR ADVANTAGE

photo: lp building products

Feature


photos: canwel

Feature

to allow for a clean break. Even if a right angle needs to be cut out of a sheet, only one of the cuts will require the help of a saw. The second edge can be scored and snapped. In addition to coming as a 4’ x 8’ sheet that is 3/8” deep, it is available as 4’ x 4’ sheets with ¼” or 3/8” depths. It is certainly an option when installing ceramic tiles, which have some unique sub-flooring needs of their own. In cases where a wood sub-floor is chosen for one of these projects, it is best to use a double layer of an exterior grade of plywood, with the grain of the first layer running perpendicular to

any joists. The addition of a waterproofing membrane will help to combat moisture. Installers will simply need to be careful to use a thinset that is compatible with a plywood substrate. If the sub-floor for a ceramic tile job is limited to a concrete slab, it will be important to ensure the surface is clean, dry, and levelled with the help of a cement floor leveler which is left to cure for 24 hours. (Of course, the slab itself will need to be cured for 28 days before the tiles can be applied.) In general, it will still be better to build a layer on top of that surface. Some engineered hardwood flooring can be installed over a concrete slab, but the addition of a ¾” plywood sub-floor and a vapour barrier will help the new flooring stand the test of time. Like any other flooring material, the products used to make any sub-floor will still expand or contract when exposed to changing temperatures or humidity, and that will lead to unwanted buckling or warping once it is fastened in place. This is why it will be a good idea to allow any of the building material to acclimatize indoors for 24 hours before beginning a project. Cleanliness will also be important during any installation process. Something as simple as a little bit of grit could telegraph through to the surface of a resilient floor, while dirt could find its way into the tongue and groove joints of a laminate flooring material, affecting how well the individual boards will click in place. When it comes to enhancing the performance of a sub-floor, a number of options can offer what could best be described as some flexible solutions. The dimples found in a Superseal Dimpled Membrane, for example, can be filled with thinset to create the small pillars that would support tile or natural stone alike. For installers, one of the biggest advantages to a product like this will come in the form of the weight. This subfloor is about 90% lighter than cement board or plywood and can even be cut with scissors. The company’s options extend to the All-in-One carpet and laminate sub-floor that does not require nails or glue, yet still creates a barrier to block moisture and cold temperatures. A Warm N Quiet sub-floor, meanwhile, can reduce the noise of footsteps by as much as 26 decibels as well as offering a protective barrier against moisture. In this case, the dimpled sheets also include a layer of foam that delivers the added layer of installation. Other options to control the unwanted “pitter patter” of every footstep include the Impact-Son acoustic underlayment. This material used as a surface for laminate and engineered hardwood floors, includes a layer of natural rubber to absorb sound and offers a cushioned feel. It even enhances the insulating value of the floor with a rating of R40.

CONTRACTOR ADVANTAGE

november/december 2010

| 59


ue

3 reasons why Bulls Eye 1-2-3 is the contractor’s choice.

®

7

AL

Great Hide. Great Adhesion.

nal

of

ACE

Great Stain Killer. Preferred by professionals 2 to 1 over other water-base primers! It’s no wonder! Bulls Eye 1-2-3 dries fast, resists rust flashing and its mold & mildew resistant film makes it ideal for high humidity areas. It seals porous surfaces and bites into oil-base enamels. And its proprietary resin system gives it exceptional flexibility and durability, so it’s great for any painting project – inside and outside! For more information, please visit www.rustoleum.ca or call 1-800-387-3625 for a dealer near you!

RUST0007_CAS_FP_4C_E.indd 1

10/20/10 10:09:19 AM


Feature

photos: cgc inc.

Quickstyle’s QuietWalk, meanwhile, is rolled in place with the barrier film facing up enabling a floating floor to easily slide over the surface. The padding is butted together at the seams, with a tape strip from one section pressed against the overlap of the vapour barrier on the next section. The options can be about more than dampening sound. The added protection in a product such as Quickstyle Underlayment Foam will protect tiles and grout from the cracks that form in a concrete sub-floor, and even offer a barrier against bacteria and fungus. Armtec’s Platon P6 flooring underlayment is a dimpled highdensity polyethylene (HDPE) membrane that allows the concrete to breath while offering a thermal break from the slab. This material can also withstand the high alkaline concrete that can attack a conventional polyethylene. An OSB load-spreading sheet is simply placed over the Platon and fastened to a concrete slab at 24” intervals. Of course, there are situations when the sub-floors will actually be integrated into a climate control system, complete with the tubes and pipes that will deliver a warm supply of water to create radiant heat. In these cases, the installation method will dictate the type of sub-floor to be used. In a slab on grade system, the related pipes are laid into a concrete slab, while a thin slab system will secure the pipes in grooved panels which are attached to the sub-floor. In a plate system, the pipes will be suspended below a wood sub-floor. Installers who are working on these sub-floors will need to take particular care to make sure that they do not damage any of the related pipes as they complete the jobs. Leaks will lead to trouble. It is simply another example to prove why sub-floor selections can be important.

CONTRACTOR ADVANTAGE

10:09:19 AM

november/december 2010

| 61


Building Up Your Equity

Did you lose capital during the latest meltdown? If you did, there is a way to recoup some or all of it. By Mark Beckham

I have a simple way for you to recoup your past losses in the stock markets. According to Mackenzie Financial, when the meltdown happened in the markets back in the spring of 2008 the TSX sat at 15,073. By March 2009 the index had dropped by an alarming 50% to 7,567. None of us were immune from the losses. If you had investments of $100,000, they were now worth $50,000. All the pundits implored us to stay in, as the markets will come back. Perhaps they were right, since the TSX had come back 25% to 11,294 by June 30, 2010. Still, the reality is many of us are still down and watching as the roller coaster ride continues. One way of gaining back all your losses is to purchase a term life insurance policy equal to your losses. This puts your estate right back where it was and protects your loved ones against feeling the loss of both you and potentially a lifestyle they have become accustomed to through your hard work. For example, let us use a 55-year-old, non-smoking male. He had investments in 2008 totalling $500,000. As the markets tanked, he would have hit a low of $250,000. Through 2010 the markets have rebounded and his initial $500,000 of capital now sits at $375,000. Unfortunately he is still short $125,000 from his previous high. Do not forget there have been no earnings on the fund as well. I have a simple solution for gaining back that capital.  Buy  $125,000 of 10

year term life insurance. The premium is $41.83 a month. This is an inexpensive solution to a significant loss. If you would like to discuss these ideas and or review your current risk management portfolio please feel free to contact me, or visit us online at www.castlecare.ca. Meanwhile, a recent change in policy that the Ontario Government put in place regarding drugs purchased in the province is noteworthy. In a round about way it shows more than ever that belonging to a group plan, where the risk is spread across a broad base of many firms and employees, is better than being on your own.

According to Mackenzie Financial, when the meltdown happened in the markets back in the spring of 2008 the TSX sat at 15,073. By March 2009 the index had dropped by an alarming 50% to 7,567. There were five changes in the legislation. 1. For public drug purchases, the government funded Ontario Drug Benefit (ODB) plan for seniors and some disabled, the maximum allowable cost for generics has been lowered to 25% of the brand name equivalent. 2. For private plans, such as those with a benefits package or buying themselves, the reduction is to 50% and then re-

Mark Beckham, BSc, is one of the Principals of Bencom FSGI (Financial Services Group Inc.)  His professional experience includes employee benefits and financial services including retirement products and insurance. He can be reached at mark@bencomfsgi.com or by telephone at 888-664-5555 ext. 301.

62

|

november/december 2010

duced over the next three years to match the Government’s 25%. 3. For public plans the professional allowance for pharmacies has been reduced to 0%, while the private sector will be reduced to 0% over the next three years. 4. The allowable mark up on the ingredient cost has been limited in the public plans to 8% to a maximum cap of $125. There is no limit on the private side. 5. The dispensing fee for ODB has increased to $8 from $7, with no limit on the private sector. Currently the average national dispensing fee is $9.30.

CONTRACTOR ADVANTAGE

The net result of these changes is that the government decided to no longer pay $750,000,000 in pharmacy profits. Pharmacies say they will have to close and lay off employees. I believe they will just increase pricing to the private sector. That means higher prices for you and me. To put this in perspective, in 2009, $607 was spent per person in a family that made a drug claim. This was increasing by 5.1% a year. We really do not know the impact the above changes will have, but, certainly, costs are going to go up. Will it be in the ingredient cost, the dispensing fee or both? What impact will this have on your employees? You can certainly help them by implementing a benefits package.


a cozy, energy-efficient home starts with PinK

• Ideal for retrofit, additions and new construction • Exceptional moisture resistance and durability • Saves up to 28% on heating and cooling costs* • Qualifies for Federal and Provincial Government grants

• Trusted insulating performance • Outstanding energy efficiency • Over 70% recycled content • Adds comfort to the home • Easy to install • Non-combustible • Safe for the home

To learn more about why PINK FIBERGLAS ® is the insulation preferred † by most Canadian homeowners, contact your Owens Corning Area Sales Manager. TM

www.owenscorning.ca

† 2009

Leger Marketing Study. THE PINK PANTHER™ & © 1964-2010 Metro-Goldwyn-Mayer Studios Inc. All Rights Reser ved. The colour PINK is a registered trademark of Owens Corning. *Actual savings vary depending on initial insulation levels, climate, house tightness, and occupant activities. 70% recycled content is based on the average recycled glass content in all Owens Corning fiberglass batts, rolls and unbonded loosefill insulation manufactured in Canada. The GREENGUARD INDOOR AIR QUALITY CERTIFIEDSM Mark is a registered certification mark used under licence through the GREENGUARD Environmental Institute. Owens Corning PINK insulation is GREENGUARD Certified for indoor air quality, except bonded loosefill products. ©2010 Owens Corning. All Rights Reserved.

Doner Canada Inc.

File Name: 07-44950-009_OCB-10-0062.indd

NEW MATERIAL

Contractor Advantage November / December 2010  

Alternative Energies Issue

Contractor Advantage November / December 2010  

Alternative Energies Issue