Mitre 10 In Trade Magazine - October 2014

OCTOBER 2014

CAN GROUP GROWS IN CANTERBURY GALLAGHER: ICONIC NZ BUSINESS WORKS WITH MITRE 10 NEW MITRE 10 MEGA IN AUCKLAND’S WEST MORE APPRENTICES NEEDED PROTECT YOUR EYES MOVEMBER: CHANGING THE FACE OF MEN’S HEALTH

SEE INSIDE FOR CHANCES TO WIN GREAT PRODUCTS Offers open to account holders only Call 0800 M10 TRADE to find out more All prices and offers in this publication are valid from Wednesday October 1 – Friday October 31 2014 from participating stores.

FOREWORD Iconic business brings expertise This month we complete the second in a series of supplier profiles we’ve started in In Trade magazine.

Hamilton-based Gallagher had its origins back in the late 1930’s when company founder Bill Gallagher Snr created a system that made the family car give the family’s horse a shock every time it rubbed against it. They were humble beginnings, but Gallagher is now known throughout the world, not just for its innovative electric fence systems, but for a range of other products and services it has developed in the past 75-plus years.

It’s this type of market-leading expertise that Mitre 10 finds so incredibly valuable to partner with, and which also has direct benefits to our customers.

Read more about the Gallagher story on page 4.

New store opening As part of Mitre 10’s ongoing commitment to servicing growing parts of the country, it’s also very exciting to look forward to the opening of the new Westgate Mitre 10 MEGA store out in Auckland’s northwest.

This is one of the fastest growing areas in the region, and the new store will be a huge asset to the local community.

There’s more about this exciting new store starting on page 6

Get behind Movember Also this month, we have news on our lead-in to Movember – the men’s health campaign that proved so popular with Mitre 10 staff, suppliers and customers last year.

A large number of us took part in last year’s event, growing Mos and raising funds for men’s health, and we’re looking forward to doing it again.

We encourage all of you to get behind Movember is whatever way you can.

Check out page 12 for more information.

Andrew Cochrane, General Manager Trade Mitre 10 (New Zealand) Ltd

CONTENTS t

2 4

PROFILE CAN Group grows in Canterbury

SUPPLIER FOCUS Gallagher

6 8

PROFILE Mitre 10 MEGA Westgate

CUSTOMER UPDATE Portabuild

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11

BCITO More apprentices needed

THE TRADES COACH WIP yourself into shape

12 14 16 18 21

MEN’S HEALTH Movember closing in

SITE SAFE NZ Eye protection

BRANZ Window sill support

LEGAL

Canterbury’s CAN Group offers a range of trades and services and is working closely with Mitre 10 MEGA Hornby to ensure it meets the requirements of Mitre 10 customers.

Cover: Mitre 10 MEGA Hornby’s Liam Pawson (left) and Group Manager of the CAN Group, Kris Tarrant.

Hamilton-based Gallagher is a world leader in its area of expertise and started when Bill Gallagher Snr found an ingenious solution to an annoying problem back in 1938.

The new Mitre 10 MEGA at the Westgate town centre in Auckland’s northwest will be one of the first retail stores to open and will service a rapidly-growing part of New Zealand’s largest city.

It’s been more than four years since the first of the Canterbury earthquakes devastated the Canterbury region but, like many businesses in the area, Portabuild NZ is now experiencing strong growth off the back of the rebuild.

The Building and Construction Industry Training Organisation (BCITO) is experiencing unprecedented growth in new apprenticeships, but the construction industry still remains woefully short on skilled tradespeople and needs even more apprentices to fill the future demand that’s expected.

If you run a construction business that has the length of project running over multiple months and primarily with fixed price contracts, Work in Progress (WIP) reporting can give you a far more accurate picture of how your business is working.

Last year, more than 410 people were involved in the Mitre 10 Movember network, raising almost $50,000 in support of men’s health. This year’s Movember event is rapidly closing in, and it’s time to grow a mo to again support this wonderful cause.

Injuries to the eye ranked third by number of claims for carpenters and joiners in 2012 according to ACC, with 1,566 claims registered and an estimated 4,365 days lost from work. And that’s just for the chippies. Add in the claims from the other trades and the numbers shoot through the roof.

New Zealand houses often have large, typically doubleglazed windows. Care is needed to support the weight of these windows particularly when installed beyond the face of the wall framing.

Let the seller beware

As a business owner, you will need to not only be aware of the risks posed by recent changes to Consumer Law, but also take note of the different grace periods to ensure you do not fall between the cracks.

THE BACK PAGE

Stuff to win, points to earn Don’t miss the back page

Volume 8, Issue4 October 2014 Mitre 10 In Trade magazine is published 12 times a year in association with Mitre 10.

Managing Editor

Scott Wilson Phone: 021 725 061 Email: editor@M10magazine.co.nz

Contributors

Adrienne Jervis Carolyn Culliney – Meredith Connell BRANZ Andy Burrows – Trades Coach BCITO Site Safe NZ Movember Alan Gillard - photographer

Printer

Nicholson Print Solutions

Enquiries

ReFocus Media Ltd P O Box 21081 Flagstaff Hamilton 3256 Email: Info@refocusmedia.co.nz MMS Publishing reserves the right to accept or reject all editorial or advertising material. No part of In Trade magazine may be published without the express permission of the publisher. All rights reserved. Opinions expressed in In Trade magazine are not necessarily those of Mitre 10 or the publisher. No responsibility is accepted for the suggestions of the contributors or conclusions that may be drawn from them. Although the publisher has made every effort to ensure accuracy, the reader remains responsible for the correct use and selection of any tools, materials and systems followed, as well as the following of any laws or codes that may apply.

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PROFILE

Kris Tarrant, Group Manager of the CAN Group.

One call CAN do it all Having a complementary range of trades under the Ranger company umbrella allows CAN Group to share its knowledge and expertise to ensure quality results for Mitre 10 clients. “This approach adds value and efficiencies for clients, and provides an edge that enables us to meet otherwise tight deadlines,” says Kris Tarrant, Group Manager of the CAN Group.

The group’s relationship with Mitre 10 evolved when, after some market research and investigation, it became apparent that there were several areas within the industry that were coming under pressure from a supply and services point of view. Discussions with CERA, the Canterbury Earthquake Recovery Authority, indicated that newly establishing supply businesses within the Christchurch area would place excessive pressure on existing resources, specifically labour. The suggestion was if opportunities could be considered to bring specific resources from outside the area to alleviate these bottle-necks, that would be of huge benefit. The CAN Frame business evolved from this, based in Timaru, but servicing the Christchurch market.

Kris explains: “We then looked at the business model and decided a business-to-business relationship was essential and, in investigating that outcome, we introduced ourselves to Mitre 10 MEGA Hornby and the opportunity for this relationship developed.”

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Ranger’s origins began in 1958 with the establishment of JH Wallace Ltd, a company that provided solid plastering and tiling work throughout the South Canterbury region. The company grew steadily over the next 20 years, eventually becoming a founding member of the Nuplex Contractors Federation and a registered applicator for Nuplex industrial floor toppings and coatings. It later joined forces with RB Jenkins Building Ltd, which specialised in building and painting services to the residential and light commercial sectors. Operating as Jenkins Wallace & Co the business offered residential and commercial building work, plastering, traditional painting and decorating, specialist finishes and floor toppings.

The Ranger name was introduced in 2001 when Jenkins Wallace & Co Ltd re-branded and re-structured in response to the company’s growing status and capabilities within the construction sector. It was also a means of improving operational efficiency. The restructure resulted in the formation of three separate entities – Ranger Construction Ltd, Ranger Applied Finishes Ltd, and Ranger Holdings Ltd, with an applied finishes division in Christchurch.

Ranger began looking further afield for a Canterbury-based division of Ranger Applied Finishes in 1996 and it purchased Thomas Andrews and Son Ltd in 2005, an experienced and well-respected firm that had been providing traditional plastering and terrazzo services in Christchurch since 1865.

In 2011 Ranger Residential was added to work specifically in the residential rebuild and Ranger Construction established

PROFILE a branch in Christchurch. From this the CAN Group was born.

The Ranger brand is still operating successfully in the Timaru districts as Ranger Specialist Coatings (co-owned and operated

by Brad Sandri) and Ranger South, formerly known as Ranger Construction (co-owned and operated by Simon Harding). With the relocation of some key staff to the Christchurch division in 2012 and the replication of the Timaru operation, the entities began to work closely together to ensure a quality outcome for clients in the central South Island.

Internal networking is the key to a successful partnering between Mitre 10 and the CAN Group. Understanding the benefit of alignment and integration of specialist contracting trades supported through the relationship with Mitre 10, it became apparent that other services provided within the group could be refined with specific industry outcomes.

Leveraging the offering, both Mitre 10 and the CAN Group could provide, was able to be extended and could include CAN Line Ltd (interior linings/stopping). This is further supported by CAN Paint Ltd (interior/exterior painting & decorating) where the intention is to provide a customised solution for housing with frame/line/paint.

The benefits derived from this partnership is generated from the exclusivity of this relationship between the CAN Group and Mitre 10.

“If you come to a CAN Group entity and ask them to complete a project, our response will be ‘Yes we can’ but we will also introduce you to the partnership and benefits offered through Mitre 10 and CAN Group,” says Kris. “The supply relationship is essentially exclusive with the group’s principal customer being Mitre 10.”

The benefit to Mitre 10 is guaranteed supply; the benefit to the builder is ‘one call does it all’; and the benefit for CAN Group is that it doesn’t require a front-end for the business. As a result, the group obtains the huge benefits of being associated with such a well-known brand as Mitre 10.

From the builder’s point of view they only need to contact Mitre 10 and the CAN suite of services is available as part of the extended Mitre 10 offering. Kris says the time saving for builders is the requirement to only send one set of documents to Mitre 10 and they CAN do it all from there.

“Mitre 10 will obtain all the necessary pricing required to complete their projects on-time and hassle free. This means one account, one bill and one account manager who facilitates on your behalf.”

Ranger group shot (from left) – Graham Eaton (Operations Manager for CAN Frame), Wayne MacPherson (Operations Manager for CAN Line), Liam Pawson (Mitre 10 MEGA Hornby), Colin Walker (Operations Manager for CAN Paint).

last nine years have been sales and technical support to the plastering industry in a supply capacity. Through this period he has dealt with a very diverse group of customers which highlighted to him a need for a proactive, enthusiastic supplier of (internal linings) sub trades to builders both in the residential and commercial markets. He utilizes a large subcontractor base and is capable of taking on projects of any size undertaking installation of insulation, metal ceiling battens, Gib® fixing and interior plastering or stopping as a Club Gib® Installer .

Colin Walker, Operations Manager for CAN Paint, previously ran his own successful manufacturing business, and has been involved in the building, property and engineering arena for over 30 years. He has worked on both sides of the EQR fence as a building supervisor with EQR and then Project Manager for Ranger Residential. Colin now runs the Ranger Residential & CAN Paint entities of the Ranger Group which predominantly works in the EQC Rebuild & light commercial areas (offices, retail & commercial spaces).

Graham Eaton, Operations Manager for CAN Frame, has as many grey hairs as he has seen sticks of timber run through the drop saw, manufacturing truss or wall frame components for more than 30 years. One of the most experienced detailers in this trade, Graham brings a wealth of knowledge as Operations Manager for CAN Frame and his hands on approach adds building know how to the CAN do attitude in delivering this service.

Each of the CAN Group entities has their own Operations Manager who ensure quality, consistency and delivery for, builder, the client and Mitre 10.

This new concept is currently working extremely well on projects for RD1 (Methven) The Laboratory (Lincoln) - craft brewery, bar & restaurant; http://thelaboratory.net.nz, Bin-Inn (Lincoln Road) and Protekt (Rangiora).

Wayne Mac Pherson is the Operations Manager for CAN Line.

Wayne has 20 years experience in the building industry either in a sales capacity or in business management, working for various companies both corporate and independent. Wayne’s

The CAN Group is growing with the help of Mitre 10 and “Mitre 10 CAN help grow your business too,” states Kris, who urges builders talk to their account manager today for more information on how CAN help.

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SUPPLIER FOCUS Innovative business continues to grow “When my father Bill Senior started this company he probably hadn’t even heard of the word entrepreneur, but that never stopped him from being one.”

- Sir William Gallagher KNZM, MBE, HonD. Bill Gallagher Snr

What started with a Waikato farmer’s ingenious solution to an annoying problem has grown into one of New Zealand’s most recognisable businesses and a world leader in its area of expertise.

In 1938, on a farm in the small rural township of Horotiu just outside Hamiton, Bill Gallagher Senior faced a problem. “Joe” the family horse had an annoying habit of scratching up against the family car. Being a skilled engineer and inventor, Bill set about fixing the problem. He came up with a simple but ingenious system that utilised the car’s magneto to give the horse an electric shock every time it rocked the vehicle.

With farming being such hard work back in the 1930’s, Bill Gallagher saw an opportunity to make life simpler for farmers like himself.

4

He began work on a battery-powered electric fence unit that could be used to safely electrify wire fencing. He began selling these devices in the late 1930’s. Little did Bill know that his visionary electric fence innovation would revolutionise New Zealand farming – enabling farmers to manage pastures more efficiently and at a lower cost than conventional fencing.

Seeing the farming benefits his friends and neighbours were enjoying and the growing demand for his electric fence unit, Bill Gallagher Senior, began full production in the late 1940’s.

Surrounded by a small but loyal staff and operating from an engineering workshop in Hamilton’s Norton Road, Bill also diversified into farm equipment like fertiliser spreaders.

From those beginnings, the foundations of the Gallagher business were laid and, since then, the Gallagher name has become synonymous with farming and animal management systems, but the company has also formed a relationship with Mitre 10 that allows supply of some of its products to customers who don’t normally use a rural reseller network.

“Our relationship with Mitre 10 is relatively new, however we have a healthy respect to what we can offer each other,” says Darrell Jones, Key Account Manager - Mitre 10. “Mitre 10 had a rural demand from the end user wanting our products outside typical approved Gallagher resellers hours.”

SUPPLIER FOCUS

Gallagher saw an opportunity for a growing market around the lifestyle farmer whom works business hours and shops after hours.”

Darrell explains that the relationship grew when Gallagher was approached by a number of stores after Mitre 10 customers had requested Gallagher-sourced products.

“This had come through the increase of lifestylers who don’t have an association with the rural merchants or were unsure where to go as well as product demand outside the usual business hours of a rural merchant with customers wanting product on the Saturday afternoon or Sundays and even public holidays,” he explains.

Recognising the types of customers purchasing Gallager products through Mitre 10 also had a huge impact on the types of products stocked at Mitre 10. The product mix has a strong focus on lifestyle products and more in the consumable products as opposed to animal weighing systems and mid to large sized energisers.

Products within Mitre 10 range from fencing tools and product, insulators and fencing standards through to battery and solarpowered energisers, batteries and remote control systems.

Outside of the electric-based products, Gallagher also offers a decorative driveway entrance gate that is unique and offers a wide variation of design patterns by simply changing the way the gate is assembled.

It’s that type of innovative thinking that has continued to allow Gallagher to develop and expand – not just as far as new products, but also in recognising new markets and opportunites.

Today, Gallagher is led from its Hamilton headquarters

by Bill Gallagher Snr’s son, Sir William Gallagher Jnr, who started working on the Gallagher shop floor in 1962 and was recognised for his commitment to enterprise and leadership skills with a knighthood in the 2011 New Year’s Honours List.

The company distributes to 130 markets around the world and has over 1000 staff worldwide. In recent years Gallagher has aligned all business units, brands and sub brands under one name, Gallagher – both to reduce outside customer confusion about who Gallagher is and what the company stands for but also to ensure complete focus on the core philosophy: to redefine what’s possible for their customers. Achieving this requires all the Gallagher team doing it ‘The Gallagher Way’ and behaving in a way that embodies: a customer inspired approach, a relentless drive for innovation, an undying commitment to outstanding quality.

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PROFILE

The new Westgate Mitre 10 MEGA is currently undergoing fit-out in readiness for its opening.

Mitre 10 MEGA Westgate rises in the west The new town centre at Westgate is part of a massive $1 billion transformation of Auckland’s northwest.

Westgate is expected to span 2.5km and be a leading development for New Zealand, and Mitre 10 MEGA will feature prominently in the ground-breaking initiative. Plans for Westgate include a new town centre, incorporating a town square and library, a new village centre and employment park at Hobsonville. Also planned is the creation of a community and marine industry precinct at Hobsonville Point. The transformation will ensure regional economic growth along with social, recreational, environmental and transport benefits.

Thousands of new jobs and new homes will result.

Mitre 10 MEGA Westgate has its opening day planned for the end of October and it will have the kudos of being the first retail operation to open in the new development.

“We’ll be the first cab off the rank, so to speak,” says co-owner Dave Hargreaves, who is excited by the prospect.

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“It will be a fully fledged MEGA store with a comprehensive trade offer right across the board,” says co-owner Dave Hargreaves According to Adrian Moreton, Mitre 10’s North Island Regional Trade Development Manager, the store will strengthen the group’s offer in Auckland’s northwest.

“It will be a fully fledged MEGA store with a comprehensive trade offer right across the board,” he says.

With a footprint of more than 10,000sqm, the store will include an extensive undercover and yard offering of building supplies, hardware and timber, as well as a garden centre and Columbus Café.

PROFILE Neil Race is the Trade Manager of the new Mitre 10 MEGA Westgate store and is looking forward to the challenge awaiting him.

Outstanding in every way, Mitre 10 MEGA Westgate will feature a huge stockholding for trade customers, competitive pricing, and prime facilities including a covered drive thru. The Trade team will be hand-picked and comprise experienced staff.

Experienced Trade Manager, Neil Race will be heading the Trade Team. Neil’s former role was Trade Manager at the very successful Mitre 10 MEGA Warkworth store, where he was for a number of years, in a role that he thoroughly enjoyed, and was able to build strong relationships with his customers. Neil is well-versed in the operations of Mitre 10 MEGA and has a very strong trade background to bring to his new challenge in the Mitre 10 MEGA Westgate team.

Neisl says he’s looking forward to the challenge.

“It’s going to be a bit lonely here for a while, but once this corridor through here is completed, there’s going to be a lot happening,” he says. “We can get out a build relationships with everyone around us.”

It’s a view reflected by Adrian Moreton.

“The opening of the store is timely for builders involved in Westgate’s development,” says Adrian. “We’ll be here to service trade customers involved in the new development, as well

Dave Hargreaves on site at Westfield, where the sprawling new development will soon see the opening of a brand new Mitre 10 MEGA. as all other local building work from commercial through to residential, new builds to alterations and additions. We’re also able to extend our offer to the sub trades.”

Fully equipped and staffed by a knowledgeable team, the store will cater admirably to the trade market and be of great assistance to builders.

One of Neil’s first jobs is to recruit a strong Trade team at the store, and he says he’s aiming to fill key positions with people of a high calibre with strong trade knowledge and awareness.

“We’re on a quick trajectory,” says Dave. We won’t be on the slow burner, but will hit the ground running.”

Mitre 10 MEGA Westgate is jointly owned by Stephen and Graeme Ricketts, and Dave and Elaine Hargreaves. Previously in the Retail Operations team at Mitre 10’s Support Centre, Dave recently left to start his own Mitre 10 MEGA. Mitre 10 MEGA Westgate is the fulfilment of a long-held ambition to own his own store. Dave believes his experience combined with the Ricketts’ Mitre 10 history is a perfect combination. Stephen and Graeme are experienced Mitre 10 MEGA owners, running two successful stores in Hastings and Napier.

Designed for New Zealand Conditions Fully equipped and staffed by a knowledgeable team, the store will cater admirably to the trade market and be of great assistance to builders.

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PORTABUILD

Business growth important for region David Fraser, Portabuild NZ’s Business Unit Manager.

It’s been more than four years since the first of the Canterbury earthquakes devastated the Canterbury region but, like many businesses in the area, Portabuild NZ is now experiencing strong growth off the back of the rebuild.

Portabuild are experts in portable buildings and relocatable homes and, when we first profiled the business about 18 months after the February 2011 quake, demand for their buildings was high. According to Portabuild’s Business Unit Manager, David Fraser, the company’s business is blossoming, even though it has raised a number of new challenges.

Portabuild has also provided a number of buildings to the New Zealand Fire Service and built a complex at the main central fire station in Christchurch as well as recently completing 2 new classrooms for Marshland primary school, highlighting the vast range of portable buildings options the company can offer.

In addition to their Canterbury growth, Portabuild is also experiencing significant growth in New Zealand’s largest city, with Auckland providing significant impetus to its expansion.

“Our activity in Auckland has grown significantly, with huge opportunities as Auckland gears up for their own building boom,” David explains. “We’re also developing as part of the ongoing expansion in infrastructure upgrades in Auckland.”

“I think most companies have seen new opportunities arise from the earthquakes in Christchurch,” he says. “But we have had to re think new solutions to accommodate very different scenerios.

David highlights that one of the keys to meeting their customers’ needs in Portabuild’s ongoing projects is the relationship with Mitre 10, which is continuing to grow and develop.

“Our people have risen to the challenge and this has allowed us to widen our scope of work. Portabuild now has the capacity to take on larger project work and continue to meet the lead times and expectations of their customers.”

From its head office in the Christchurch suburb of Hornby, Portabuild deals directly with the Mitre 10 MEGA Hornby store, whilst its Auckland plant, located in Papakura, works with the Mitre 10 MEGA Takanini.

Amongst the projects being undertake in Canterbury have been a number of complexes built for major international construction business Arrow International as part of the rebuild of the Nazereth House aged care facility, the Sudima Hotel reconstruction and the Port link.

“We have now got to know Mitre 10 very well and the relationship has gone from strength to strength,” he says. “We have developed a more personalises knowledge of each other and they understand our expectations and continue to deliver for us.”

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W E N

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BCITO

9000 building apprentices not enough to meet growing demand Mr Karaitiana says the industry needs to spend more time and resource planning for its future skills and labour needs and individual businesses need to stay in tune with the rest of the industry.

“This demand is going to go on for some time, so there needs to be a much more structured approach. Construction businesses need to be thinking about what their business demands are next year and then considering what they should be doing now to meet those demands.”

BCITO Chief Executive Ruma Karaitiana

The Building and Construction Industry Training Organisation (BCITO) is experiencing unprecedented growth in new apprenticeships, but the construction industry still remains woefully short on skilled tradespeople.

Now with 9000 apprentices in training, having signed on an average of 106 new sign-ups per week in 2014, BCITO Chief Executive Ruma Karaitiana says it’s still not enough to meet growing demand.

“All of the construction trades across the board, from carpentry to painting and brick & block laying, are under huge amounts of pressure, and all the data says this pressure will continue into the 2020s,” he says.

“We’ve come out of a period where because of the recession we weren’t building enough houses to maintain normal demand, particularly in Auckland. Then unfortunately we had the Christchurch earthquakes leading to large rebuild projects, which have only compounded the pressure. The result is an extremely high demand environment and we simply don’t have the number of skilled tradespeople to meet that demand.”

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While thinking and planning is naturally largely based on individual order books, Mr Karaitiana believes businesses also need to step back and look at the whole industry, which is showing growth trends further into the future.

“One of the very real challenges we have is around the population – the construction industry wants the same people for its future that the engineering, farming and technology sectors want for their industries. Planning for the construction industry therefore means we need to understand what people might be available in the marketplace, and whether we should be more pre-emptive with our training and hiring decisions.”

As a result of industry growth, the BCITO recently signed up its 9000th apprentice – Deniro Larsen-Marsters of Auckland, a graduate of Te Puni Kokiri’s Maori Cadetship Programme.

Active since mid-2013 and in partnership with the BCITO, the programme supports unqualified Maori tradespeople into the industry, helping to alleviate demand for skilled workers.

The six-month cadetship is designed to give Maori in full-time employment the skills and experience to prepare them for further training and a career in the construction industry.

Following the cadetship, cadets are encouraged to transfer into an apprenticeship through BCITO where they can go on to become qualified tradespeople or project or site managers.

To register your interest in joining the building and construction industry, fill in the Looking for Work form at http://www.bcito.org.nz/ lookingforwork, or check out www.getreal.co.nz

H C A O C S E D A R T

WIP your books into shape!

By Andy Burrows

If you run a construction business that has the length of project running over multiple months and primarily with fixed price contracts, this article is definitely for you and I encourage you to read on.

If your business is one that typically has projects completed much quicker than a month, then it may not be for you and you should file it for future reference, or move on to another page.

You are still with me, so I guess that puts you into the “multiple month” category. I hope you find this useful.

Question. When you run your monthly Profit & Loss (P&L) report (you do run one, right?), do you find that both the dollar value and the profit percentages vary wildly from month-tomonth and you start to doubt the value of the report? Sure, it probably balances out over time, but as far as being able to judge how the core operation of your business is performing THIS month, it isn’t much use. If so, maybe it’s because you are not adjusting the figures to take account of Work in Progress, or WIP. This is especially important for builders who are running multiple projects over multiple months.

So what is WIP and how should you allow for it in the P&L report?

Looking to Wikipedia, it says: Work-In-Process in construction accounting identifies the value of construction projects which are currently being worked on by the construction firm. To properly account for each project, FOUR values are needed for each project at the end of any given month (or period): 1. the Sales Price for the project, 2. the total Cost Estimate for the project, 3. the Costs-To-Date, 4. the Billed-To-Date.

By taking the Costs-To-Date divided by the Cost Estimate, the “percentage complete” for the project is calculated. For example: • Assume a project is estimated to cost $70,000 by the time the work is complete • Assume at the end of December, $35,000 has been spent to date for the project • $35,000 divided by $70,000 is 50%, therefore, the project can be considered 50% complete at December 31.

Calculation of the Percentage Complete is a vital tool in determining how much the client should have been billed by now.

The next step is to compare the estimated billing amount (% Complete X Contract Sale Price) to the Actual figure billed to the client. If the actual figure is greater than the estimated figure, you have OVER-BILLED the client at that time. If the actual is less than the estimate, you have UNDER-BILLED the client. Make sense so far? It is advisable that invoicing, and even collection of these invoices, is greater than the costs expended to do the work. This ensures that the client is directly funding the building work, and that the contracting firm minimizes its borrowings.

But you can go too far too quickly. Too much over-billing can distort the P&L, lull you into a false sense of profitability and run you short as the project nears completion. For more accurate management figures, the monthly financial P&L produced from your accounting system should be adjusted downward for over-billings and upwards for under-billings. In my opinion this will provide a more realistic gross profit figure and show the underlying operational efficiency being achieved by your company, or not as the case may be. You can choose to either make this adjustment via a journal entry at month end to the P&L and Balance Sheet, or just make the adjustment off the system, after running the monthly reports.

As they say, more accurate information results in better decisions. By having a more accurate, underlying gross profit figure to look at each month, it is easier to make small adjustments to your operation and nudge it back on track. The alternative is waiting for your annual accounts to be produced, getting a big surprise and trying to force through major changes in one go; a much tougher ask.

For help in putting together a useful dashboard of key numbers to track the performance of your operation, email me at andy@ tradescoach.co.nz.

NB. If you are making this adjustment in your financial accounting system, remember to reverse the entry at that start of the new month so your accounting system is not corrupted.

Andy Burrows Andy Burrows has been a professional business advisor, mentor and coach since 2006. He specialises in working with the owners of construction-related businesses to build systems and profitability into their operations.

Contact Andy on 027 688 6721 or email andy@tradescoach.co.nz. Visit his website at www.tradescoach.co.nz

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MOVEMBER

Mitre 10 Trade gets behind Movember 2014 Mitre 10 Trade is partnering with Movember for the third successive year, and urges its staff and customers to get on board and support this magnificent men’s health initiative.

Since its humble beginnings in 2003 in Melbourne, when 30 Mo Bros first grew moustaches, Movember has grown to become a truly global movement, inspiring more than four million Mo Bros and Mo Sistas to participate in 21 countries worldwide.

Together, Mo Bros and Mo Sistas have raised $705 million, which has funded 832 programmes aimed at achieving our vision of having an everlasting impact on the face of men’s health.

New Zealand is about to enter into its ninth official Movember campaign and has now raised more then $10,000,000, which has funded 37 individual programmes. These programmes are implemented through Movember’s local men’s health partners the Cancer Society of New Zealand and the Mental Health Foundation of New Zealand.

Mitre 10 Trade is proud to support the Movember campaign for the third straight year and is looking to surpass the huge result achieved last year. In 2013, the Mitre 10 Trade network was one of the largest in the country with more than 410 members and, 12

thanks to the efforts of stores and staff, clients, suppliers and the general public, raised more than $48,000 towards this great cause.

“The Movember campaign is something we see as extremely worthwhile,” says Andrew Cochrane, Mitre 10’s General Manager Trade. “We strongly encourage our Mitre 10 Trade customers and staff to think about their health and get those health checks done.”

Mental health Mental illness is a serious issue, affecting almost half the New Zealand population, over their lifetime. Men in particular, face a unique set of challenges when it comes to managing their mental wellbeing, with the associated stigma (of shame and embarrassment) often preventing men from seeking help and taking action.

The Facts: Globally • Men are almost twice as likely as women to take their own lives; • Globally, suicide rates are highest in people aged 70 years and over;

MOVEMBER

• Suicide is the leading cause of death globally for people aged 15-29 years; • In 2012, higher income countries had a slightly higher suicide rate (12.7 per 100,000 people compared to 11.2 in low-middle income nations.

New Zealand • One in six New Zealanders will experience a major depressive disorder in their life; • One in seven young New Zealanders experience a major depressive disorder before age 24; • One in eight New Zealand men will experience depression over their lifetime; • Depression increases the risk of suicide by 20 times; • In 2010, 522 New Zealanders died by suicide of which 380 were men (72.9%); • Males have lower rates of mental health service visits than females; • People with a serious mental illness have life expectancy reduced by between 15 to 25 years in comparison with the general population.

Together, the Mental Health Foundation of New Zealand and Movember are working to create awareness of depression and anxiety, and to break down the staunch Kiwi attitude ,which prevents blokes from seeking help and support when they need it.

Things to Remember: • Mental health issues are common and treatable; • Take action early – the sooner the better; • Mental health issues are illnesses, not weaknesses, and people shouldn’t feel ashamed to talk about them and take action; • By talking about mental illnesses, we can help raise awareness and reduce the stigma;

Participating in Movember At the start of Movember, guys take action by signing up at Movember.com with a clean-shaven face and for the 30 days of November commit to growing a moustache. These selfless and generous men are known as Mo Bros and groom, trim and wax their way into the annals of fine moustachery. Mo Bros are supported by the women in their lives, affectionately known as, Mo Sistas. Together, our Mo Community raise money and awareness to change the face of men’s health.

With the sprouting of a new moustache, Mo Bros effectively become walking, talking billboards for the month, and like a run or walk for charity they use their hairy ribbon to spark conversations around the often ignored issue of men’s health

and seek funds to support the work of the Movember Foundation.

At the end of the month, the Movember community celebrates their Mo growing efforts, either by joining us at one of the official Movember Gala Partés, held around the world. Or, by hosting their own end of month event with colleagues, friends or community groups.

See you at Movember.com this 2014 campaign, the DZG team are getting out the razors on the 1st of November and will pulling on our inner Tom Selleck to grow the best top lip blankets we can!

How to get involved The 2014 Movember website is now live (http://nz.movember. com) and you can sign up as a Mo Bro or Mo Sista, to help Mitre 10 Trade get involved again in a big way. Once you have signed up, you can support by joining an existing Mitre 10 Trade team or starting your own Mitre 10 Trade team.

Your first step will be to sign up. When signing up you have three options. You can start a team, join a team or sign up as an individual. If your Mitre 10 store already has a team, then we would suggest you join that team. If you are the first to sign up from within your store then you can start a team and encourage others to join.

Once you have signed up you should also join the Mitre 10 Trade Challenge Network. You can find the Network by searching for it in the search box at the top right hand corner at Movember.com. A Network is a great way to capture everyone within an organisation or company, as the collective fundraising efforts of all teams and individuals within the Network all count towards the Network total. The Mitre 10 Trade Challenge Network is a great way to see how each team is progressing throughout the month, while also seeing the difference that Mitre 10 has made as a entire organisation.

When you have completed signing up, joining a team or creating a team and joining the Mitre 10 Trade Challenge Network you will be able to check out your very own Mo Space page. Your Mo Space page is your personalised fundraising hub.

It is the place to recruit others, request and view donations, promote your campaign effort via social media, post updates about your Mo journey, claim rewards and much more.

If you need a hand with signing up yourself, starting or joining a team, or joining the Network, don’t hesitate to get in touch with the friendly crew at Movember, by emailing info.nz@ movember.com or free calling 00800 MOVEMBER (6683 6237).

Also, look out for more information coming from your local Mitre 10 Trade store, where you can win prizes as part of being part of Movember with Mitre 10 Trade.

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SITE SAFETY Save our sight: eye protection at work

Site Safe is a not-for-profit industryled organisation that promotes a culture of health and safety in the New Zealand construction and related industries.

For more information about how Site Safe can help keep you safe at work, visit www.sitesafe.org.nz

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Eye injuries are common in the trades and they can cost a lot. Not just in terms of lost time and income, but with the very real cost of being blinded for life.

Injuries to the eye ranked third by number of claims for carpenters and joiners in 2012 according to ACC, with 1,566 claims registered and an estimated 4,365 days lost from work.

And that’s just for the chippies. Add in the claims from the other trades and the numbers shoot through the roof.

Eye protection and how we’re using it Eye protection falls into the Personal Protective Equipment (PPE) category, alongside steel-capped boots, hi-vis clothing, ear-muffs and hard hats.

SITE SAFETY

• The worker gets a headache from wearing the eye protection; • The worker normally wears prescription glasses and didn’t have suitable “over glasses” available

What are the hazards?

To make the correct decision as to what type of protective eye wear should be worn, you’ll need a thorough understanding of the potential hazards in each workplace.

The key hazards are: • Projectiles (concrete, metal, wood and other objects such as staples, nails or shards of broken material) • Chemicals (splashes, fumes, dust particles) • Radiation (visible light, ultraviolet radiation, heat or infrared radiation and lasers) • Biological (hepatitis, HIV etc) from blood or other bodily fluids.

Choosing the right gear Once you’ve identified the hazards, you can make the right choice from the range of safety eyewear available. Sometimes, you might need more than one kind.

Types of eye protection available: • Non-prescription and prescription safety glasses – these can look a lot like normal glasses or sunglasses, but are tougher, and designed to protect the eye from a range of hazards.

Safety glasses are generally better for projectile hazards and radiation such as UV sunlight.

• Safety Goggles – these provide the same protection as glasses, but with better protection for chemical or biological hazards.

The two major reasons workers experience eye injuries on the job are because they were: 1) Not wearing eye protection, or 2) Wearing the wrong kind of protection for the job.

The most common reasons given for not wearing eye protection include: • The usual, “I forgot” or “I lost them”

• Face Shields – good for high impact projectile protection and for workers exposed to chemicals, heat and biological pathogens.

• Helmets – best for use near hazardous radiation such as welding, and when grinding or working with molten metals.

Making eye protection easy Here are three simple steps that can ensure the safety of everyone’s sight onsite:

• The worker feels or thinks they look silly wearing certain types of eye protection.

• Conduct a hazard assessment - find out what hazards exist on your work site.

• The eye protection lens is scratched, dirty, they fog up or are unserviceable;

• Provide the right protective equipment for the various tasks Make sure they fit each worker comfortably

• The eye protection doesn’t fit properly;

• Make wearing eye protection compulsory – this really works 15

BRANZ

Sill support for windows New Zealand houses often have large, typically double- glazed windows. Care is needed to support the weight of these windows particularly when installed beyond the face of the wall framing.

Two challenges created by large, double- glazed units installed beyond the face of the wall framing are: • ensuring the weight of the window is carried down through supporting elements to the building structure • providing support to the sill flashing in directfixed cladding situations.

Align setting blocks and frame support blocks Double-glazed units are supported within the window frame on setting blocks to prevent glass-to-frame contact. They are used in pairs and must be located in accordance with AS/NZS 4666:2012 Insulating glass units generally at ¼ and ¾ points across the width of the glazing units (see Figure 1a) but they may also be located within the greater of the width/8 or 150 mm from the glass edge (see Figure 1b).

For direct-fixed claddings, E2/AS1 requires aluminium window frames to be supported on frame support blocks. These may either be fitted to the frame by the manufacturer or be a proprietary product that is installed by the window installer. However, E2/AS1 does not state where the support blocks must be installed.

Support blocks must be located directly underneath the setting blocks to ensure the load of the windows is transferred directly to the building structure. In some situations, windows have failed because the support blocks have not been aligned with the setting blocks.

Therefore, before installing the window, confirm the location of the setting blocks, and ensure that the support blocks align with them (see Figure 2).

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BRANZ

Sill flashing support for windows The flat sill tray flashing that is required by E2/AS1 for direct-fixed claddings must also be supported and allow for the installation and support of the frame support blocks.

Typically, the sill tray is supported at least in part by the sill trimmer (E2/AS1 Figure 72A)and by the top edge of the cladding where it is accurately trimmed to the opening (E2/AS1 Figures 81 to 84 for weatherboards and Figure 115 for flat sheet cladding).

A problem can arise where the cladding is not installed accurately and there may be insufficient bearing for the frame support blocks because of the cladding used and/or the location of the installed window frame, for example, E2/AS1 Figure 90 for fibre-cement weatherboards.

Where this occurs, the options are to install: a metal angle bracket to the sill trimmer (not a proprietary sill support bar used for cavity construction) to support both the part of the sill tray flashing forward of the framing and the frame support blocks (see Figure 2) a horizontal metal flat sealed to the sill tray and screwed with a sealed fixing into the upper face of the sill trimmer and projectingforward of the framing line on which a frame support block can be placed (see Figure 3).

Figure 4 shows the board and batten cladding trimmed to the line of the sill trimmer with support also provided by the horizontal batten fixed between the vertical battens (fixing the horizontal batten between the verticals ensures the vertical board joint is fully protected from the weather – if the horizontal board under the sill is continuous and the verticals butted to it, the bottom edge should be undercut or the flashing downturn extended to provide better weathering to the joint).

Simpler over a cavity It is worth noting that installing windows is considered easier where a cladding is installed over a cavity, a proprietary sill support bar can be used and the sill tray flashing omitted.

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EGAL LSellers beware? What recent

Consumer Law reforms mean for you and your business.

by Carolyn Culliney Recent changes to Consumer Law are well underway. From new duties in extended warranty agreements through to harderhitting penalties – the reform affects many business-consumer interactions. As a business owner, you will need to not only be aware of the risks posed by these changes, but also take note of the different grace periods to ensure you do not fall between the cracks.

Extended Warranties: New Duties These are agreements between the consumer and a “warrantor”, which can be a business selling goods or services, an insurer, or a manufacturer. Normally, extended warranties arise when a customer, at the time of purchase, pays extra for an extra guarantee. Since 17 June 2014, there are two new demands of businesses selling extended warranties.

Carolyn Culliney is an Principal in the Commercial Corporate team at Meredith Connell.

Carolyn’s practice encompasses advice on all forms of commercial contracts. Carolyn has a particular specialization in construction law and has been a guest speaker for the New Zealand Law society on the subject.

Carolyn can be contacted on (09) 336 7500 or by email at carolyn.culliney@meredithconnell.co.nz

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First, the customer purchasing the extended warranty must be aware of their existing rights. This means the agreement must be clearly presented and in plain language. It cannot just summarise the Consumer Guarantees Act 1993 (CGA), but must show, by way of comparison, how your extended warranty gives extra protection beyond existing legal obligations. It must also note the warranty’s specific conditions (including its duration and expiry date), state the customer’s right to cancel under the Fair Trading Act 1986 (FTA), and include the warrantor’s business and contact details.

Before entering into the agreement, the customer needs to be made aware by being told verbally, that that he or she has a right to cancel the extended warranty agreement within five working days of receiving a copy of it. The consumer must understand that you, as warrantor, must be notified of their cancellation, and that the extended warranty price will be repaid in full.

Unfair Contract Terms in the Spotlight From 17 March 2015, standard form contracts (those not negotiated with individual parties in mind), will be scrutinised for unfair terms. What is “unfair” varies between transactions, but common examples may include penalising just one party for breaching the contract, or allowing one party to unilaterally cancel. If a term is found to be “unfair”, it cannot be enforced.

The Court may then order the party seeking to enforce the unfair term to pay compensation, vary the agreement, or require it to remedy the situation. Alternatively, a fine may be imposed – the cost of which is much higher than before, as discussed below.

No Escape from Consumer Protection Law The new law highlights that businesses cannot ignore consumer protection laws, such as the FTA or the CGA. Therefore, even if the customer has signed a document waiving their rights under the FTA, the business is unable to hold the customer to the waiver.

However, one major change from 17 June 2014 is that businesses may agree, amongst themselves, that certain parts of the FTA do not apply to their business to business

LEGAL transactions. The agreement must be in writing, concern goods or services “in trade” (i.e. not for personal use), and be “fair and reasonable”. What is “fair and reasonable” depends on the specific case, but relevant factors include the nature of the agreement, the value of the goods or services, and whether both parties obtained legal advice.

Harder-hitting Penalties

The CGA already provided businesses to contract out for business to business transactions, however, the addition of the “fair and reasonable” requirement has been made so that it is in line with the FTA.

An employee of the Commerce Commission can now enter places of business to inspect that business’s consumer information and product safety standards. Upon finding breaches of these standards, they may issue spot fines of up to $2,000. The Commission can also now require individuals, who are the subject of an FTA investigation, to undergo an oral interview.

Unsubstantiated Representations: Choosing Your Claims Carefully Since 17 June 2014, every claim a business makes relating to a good or service must be “substantiated”. This means a claim needs to be supported by “reasonable grounds” which can be sources like scientific journals, information from reputable suppliers or manufacturers. Such evidence must exist at the time the claim is made. If the claim is unable to be substantiated at the time it is made, even if proven to be true at a later point in time, you will still be liable.

Since 17 June 2014, fines for not complying with the FTA have been increased as individuals may now be fined up to $200,000, and companies up to $600,000. Further, the Court can ban individuals convicted of two or more FTA-related offences from being involved in the management of a company.

Auctions and Auctioneers Since 17 June 2014, new rules apply to auctions selling property on behalf of a seller. Where the vendor is in trade as a supplier, and the goods are for a personal or household purpose, the CGA applies. Similarly, sellers offering goods and services via internet auctions are now required to make clear if they are in trade. All this should be provided in the auction notice, which may take the form of brochures, a notice at the auction room’s entrance or on a readily accessible website.

Something to go with smoko Download our FREE app for the MiTek Fixings Guide

www.miteknz.co.nz 19

Bahco ProfCut™ Insulation Saw

The ultimate way to cut all sorts of insulation materials Construction: The saw is 550mm (22in) long and has 7 TPI (teeth per inch). The blade is 0.83mm thick, giving the same kind of saw stability as others in the ProfCut™ and PrizeCut™ ranges.

Durable: The blade is both rust and corrosion protected WT-toothing: The WT-toothing (wave toothing) is especially designed for cutting insulation material. Each wave has a length of 15mm.

Re-sharpenable: The blade is able to be resharpend with any regular knife sharpener.

Available at

Proven: This handsaw has been tested on all sorts of insulation materials and gives an excellent finishing with low friction and creates less residual dust.

Answer the following question and you’ll go in the draw to win a cool Mitre 10 Trade dart board (and six darts) for the side of the smoko shed.

WIN A MITRE 10 TRADE

DART BOARD

Email your answer to m10trade@mitre10.co.nz with the words ‘October dart board comp’ in the subject line and you’ll go in the draw to win.

You must include your answer, your name, company name, physical address, daytime phone number and the name of the store you hold an account with.

All entries must be received by 5pm on Monday November 3rd, 2014.

Conditions of entry: You may enter only once/ Prize(s) are as outlined. Prize(s) are non-

refundable, non-transferrable and not redeemable for cash. The winner(s) will be notified by phone or email. Employees of ReFocus Media Ltd Ltd, Mitre 10 (NZ) Ltd, suppliers of goods to Mitre 10 and their immediate families and agencies are not eligible to enter. By entering this contest, you consent to the use of your name in all matters related to this contest, including any advertising or publicity without further compensation. Results of this promotion will be published in a later issue of Mitre 10 In Trade magazine. Prices that may be quoted in this promotion were accurate recommended retail prices at the time of publication. ReFocus Media Ltd and Mitre 10 (NZ) Ltd accept no responsibility for any loss or damage incurred from the use of these products.

QUESTION: How much money did the Mitre 10 network raise towards Movember last year?

THIS PUBLICATION IS RECOGNISED

BY THE BUILDING AND HOUSING GROUP AS CONTRIBUTING TOWARDS THE SKILLS MAINTENANCE REQUIREMENTS FOR THE LICENSED BUILDING PRACTITIONER SCHEME. If you are a Licensed Building Practitioner, cut out and safely retain this panel with your skills maintenance literature for future reference and audit confirmation.

Ref. In Trade Vol 8, Issue 4 October 2014

✃

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