COVID-19

No doubt about it, COVID-19 quickly changed the way we work, and play. Travel and in person visits came to a screeching halt. Professional offices, suppliers, even many working shops closed their doors to visitors. Training in the not to distant past was done, for the most part, in person. Conveniently, most trainers adapted quickly to offer online training options. Many of the companies in our industry were already familiar with platforms like Go To meeting. This made the switch to virtual training fairly easy for those trainers.

Some trainers I met through the ESCO group devised hybrid virtual training events. With a few cameras, one that would follow you around a room they kept the hands on training available also.

An instructor in front of a piece of equipment would be led through the troubleshooting in real time, clever and almost like being there.

The question remains, what happens going forward in the training world. In some cases offices that made the change to virtual workspaces plan on staying that way. In some larger cities’ that has created  office space vacancies and those building owners are scrambling to repurpose those spaces to get the rent rolling back in.

In cities like San Francisco it was a tough slog to see more than two engineering firms in a day due to traffic and parking logistics. With online, virtual sessions you can present to their entire staff as well as any locations they have scattered around the world.

I’ve started limited travel myself for training events. I doubt cramming 30 or more folks into a hotel meeting room will ever be attractive anymore. In some cases moving the training into the shop area, parking lot or a large cafeteria  area is a good option to allow attendees to spread out more.

I doubt anyone knows for sure how this will shake out or what “bug” will hit us next that makes  people want to avoid crowded rooms and spaces, but plan on having options. Come up with new ways to engage the attendees. Not being able to see faces, expressions and not getting that in person feedback changes the game for a trainer.  Add polls to your training to get some interaction and a feel for the groups. Consider multiple speakers or trainers to get some back and forth conversation in your online trainings.

The need for having a trained workforce is critical. Equipment is becoming more sophisticated and specific, so factory training will march forward. We would love to hear from all the players in the industry, thoughts suggestions, what we can do to keep you’ all coming back.

Let’s rid the ‘VID and get back to the normal face to face that we all crave.

After a challenging year resulting from the global pandemic that hit full force in March 2020, the Plumbing-Heating-Cooling Contractors—National Association (PHCC) reports that – one year later – there are signs that conditions are improving.

A contractor sentiment survey conducted by PHCC finds that 84% of respondents rank the continuing impact of COVID-19 on their businesses as having either a “low” or “medium” impact compared to 57% in spring 2020, when PHCC first began tracking trends during the pandemic. In addition, the number of people ranking impact as “medium high” to “high” has dropped to 9% from 43% in spring 2020.

“A year after COVID-19 hit, PHCC members indicate that they are cautiously optimistic that we are turning a corner toward better times ahead,” says PHCC President Hunter Botto. “Respondents also noted that their businesses have stabilized after several difficult months of disruption. They also see new business opportunities in the future, which is very good news for our industry.”

In fact, an annual environmental scan conducted by PHCC in January 2021 predicted an increased demand for home improvement spending; touchless products; upgraded and energy efficient equipment; smart technology; air and water filtration and purification; and IAQ markets, including UV and bipolar ionization.

While the overall outlook is positive, the plumbing and HVACR contractors responding to the sentiment survey cite several ongoing challenges, including maintaining a safe and fully operational staff; increased operating costs related to new safety requirements; addressing employee and customer health and safety concerns; customer delays on projects because of economic concerns; disruptions in the supply channel; and a fear of a potential recession.

Regarding manufacturers and suppliers’ responsiveness to supply chain issues, respondents noted many have been helpful by offering creative alternatives to products currently unavailable. There was an overall recognition that manufacturers and suppliers are also facing material cost increases and shortages, transportation challenges, workforce issues, etc. “They have been super helpful, but have had their own people issues, concerns and interruptions,” one contractor said.

Contractors indicate they have established many safety procedures to mitigate safety risks for employees and clients, including employee screening, social distancing, disinfection measures, increased communication about safety protocols and requirements for Personal Protective Equipment.

“As we look back on the last year, PHCC members – operating as essential businesses – illustrated time and time again that they are true professionals committed to keeping their employees, customers and communities healthy and safe,” Botto says. “As always, our members have shown they are extremely resilient in tough times.”

Another positive indicator is that – after recently completing its annual membership renewal process this spring – PHCC realized an increase in both renewing and new members.

“We are grateful for the loyalty demonstrated by our members throughout this crisis,” Botto says. “We are also excited to see growth in membership when business owners are assessing the ROI on every expenditure. Now more than ever, they can see the value of supporting and engaging with their association.”

To help navigate the many unexpected changes they faced, members relied on PHCC resources and videos via its COVID-19 Recovery Center, as well as monthly webinars, state and local support, advocacy, member discounts and access to Personal Protective Equipment.

It’s that time of year again where media, prognosticators and media prognosticators try to look into the immediate future to predict, and make sense of, the short-term economy. And, yes, even in this uncertain climate.

Having said all of that, Mechanical Hub decided to go right to the source to get an up-close sense of how the market is faring. We continue our Forecast Series with Bruce Carnevale, president & CEO, Bradford White.

MH: When it comes to 2021 industry forecasts, the most resonant word I hear is optimistic. That word can become hollow if it doesn’t have any substance backing it up. I’ve read reports that residential service repair and remodel may remain constant with a slight increase in early 2021. What does the short-term economy look like as it relates to BW?

CARNEVALE: In a word, challenging. While demand for our core residential products remains strong, material and labor costs have risen substantially.  Labor availability for manufacturers is still a significant problem and has been exacerbated by COVID-19 complications and government policies. Steel prices are at or near all time highs, and supply is becoming an issue for some manufacturers. These factors lead to longer lead times, higher prices to the end user, and product shortages.

We know intuitively that the “nesting” effect has led to increased demand because household appliances are being use much more that they normally would be. There is no good data on magnitude of the increased demand, nor how long it will last.

Commercial demand has recovered slightly, but with commercial businesses still in some state of shutdown in much of the country, we don’t see that segment starting to recover until the second half of 2021. It is unlikely that the commercial segment will fully recover to pre-pandemic levels until after 2022 because so many businesses will permanently shut down as a result of the pandemic-forced shutdowns.

MH: What are some indicators you look at to determine trends, movements, etc.? 

CARNEVALE: We look at traditional indicators such as housing starts re-sales, mortgage rates, CPI, consumer confidence, manufacturing output and inventories, unemployment rates, etc. Several years ago, we incorporated student loan debt into our analyses since it has such a significant impact on first time homebuyers. Additionally, we closely follow regulations and all levels and social preferences to determine their impact on product trends.

MH: I read somewhere that at the rate the U.S. is distributing the vaccine, we should be back to “normal” by 2024. Perhaps that’s a bit overly dramatic, but how does (has) BW positioned itself from the “fallout” of COVID-19?

The honest answer is that nobody really knows when we will be back to normal.  Even after we are, there will be lasting effects from the pandemic. We are following the data and trends closely and adjusting our strategy accordingly.  We expect some pre-pandemic trends to change significantly. For example, the trend toward urbanization will change as more people are able to work from home. This leads us to believe that the housing new construction will shift away from multifamily towards single family as people can move further out from cities.

Additionally, we are solidifying supply chain and strengthening our contingency plans, further developing our own work force, and investing significantly in R&D to bring relevant, innovative products to the post-pandemic market.

MH: Is the only certainty heading into early 2021 uncertainty? How do you forecast and budget for such uncertainty? (Or is it fairly certain at this point during the pandemic?)

CARNEVALE: Uncertainty has made forecasting for 2021 is as much art as it is science. We used an immense amount of data, both historical and forward-looking, and applied significantly more assumptions than we typically would.  We also included insights derived from some original research projects we commissioned.

MH: Without getting overly political, does a change at the presidential level (and congress) change the outlook for your company, if at all? (Infrastructure, regulations, green energy initiatives, etc.)

CARNEVALE: Yes. It is no secret that the Biden administration will have a very different policy positions than the Trump administration. Some of the expected changes may be helpful, and others will present challenges. Infrastructure legislation, for example, will be good for our industry. We know there will be a focus on green energy initiatives, and that too can be good for our industry if they are thoughtfully applied. The regulatory environment will become more challenging, but we are hopeful that the new administration will partner with manufacturers in developing new regulations.