Tru Tech officials say they can’t figure out why the plant closed in the first place and cite the company’s seasoned employees and ideal East Coast location as its keys to success.

“It didn’t make sense why this facility was closing,” said Tru Tech president John Careri.

And of course the employees who work there are thrilled to be back to work.

Patty Hayes, a 12-year employee said, “We were hoping someone would buy it. It’s a great facility.”

The purchase did, however, come at almost the eleventh hour.

Sam Collister, general manager for TruTech, came to the facility four days before it was set to close looking to buy the equipment. But when he saw the dedicated employees and impressive facility he changed his mind and thought the company should purchase the plant instead.

Collister was so impressed that he convinced TruTech president John Careri to travel to Fredericksburg to see the plant first hand and Careri was convinced as well.

“John said, ‘In two days they’re closing this? Why?,’” recalled Collister.

That’s exactly what Therma-Tru plant manager Ernie Hinegardner thought so he was happy with the news.

But he was so confident in his facility and the employees that when he heard Collister was coming, he said, “This could be our chance.”

According to Hinegardner, the average seniority at the facility is 19 years.

“Not many companies can say that,” he said.

“We were able to hire an experienced team,” added Collister.

Not all employees have come back to work but the company, and Spotsylvania County, where the plant is located, is hoping for much more.

“We hope you reach that 200-some job plateau as quickly as possible,” said Jerry Logan, a member of the Spotsylvania County Board of Supervisors.

The Fredericksburg location is a great one, but Collister admits that Tru Tech officials were looking in the New England area as a possible location for the first U.S. plant.

“It wasn’t the exact area we were looking for, but when you are able to hire an experienced management team and factory employees, it’s a great opportunity,” Collister said.

Also working in the company’s favor was the type of doors produced at Therma-Tru-steel-edged doors.

“Initially we were looking for machines to produce a steel-edged product in Canada,” said Careri. “The steel-edged door market was a niche we were looking to fill …. So that [the fact that these were produced here] was the icing on the cake.”

The Virginia facility also will distribute Tru Tech’s wood-edged doors. Collister adds that TruTech “is going to be very aggressive in the market.”

But is that enough to make the company successful here? Careri says it is.

“We cater to the customer. We listen to the customer. We cater the program that works for them. We’ve spent a lot of time developing new niche products that will fit into their marketplace,” he said.

And, again it comes back to the employees.

“The people here have something to prove,” he added. “I trust in them and they trust in me and we will be successful.”

Single-family housing starts gained 7.5 percent in May, breaking the 400,000 mark for the first time since November 2008 to reach a seasonally adjusted annual rate of 401,000 units. Meanwhile, starts in the much more volatile multifamily sector posted a 77 percent gain following a nearly equivalent decline in the previous month, for a seasonally adjusted annual rate of 124,000 units.

Both housing starts and permits were up across every region in May. Starts rose 2 percent in the Northeast, 11.1 percent in the Midwest, 16.8 percent in the South and 28.6 percent in the West. Permits rose 5.7 percent in the Northeast, 8.9 percent in the Midwest, 2.3 percent in the South and 3.8 percent in the West.

The U.S Commerce Department also reported that sales of newly built, single-family homes in May held virtually even with the previous month, declining less than one percentage point to a seasonally adjusted annual rate of 342,000 units.

He said the models companies utilize today are not working well and provided a few specific steps companies can take to improve their processes. Following are a few of his strategies that companies can employ:
• Prepare a process map/flow chart of the process. Does each step add value? Is the customer willing to pay for it?
• Develop accurate up-to-date forecasts.

• Make sure your ERP system has a robust supply-chain model. “If you don’t have one you need to get one.”

• Implement a lead time reduction program. “Lead times are killing the industry as I see it.”

• Implement an inventory turnover improvement program (build to order). “My suggestion to you all is that we all have too much excess inventory. We have it ‘just in case.’”

• Train employees yearly. “Provide 60 hours of training per year per person.” Implement a performance-based lean and green initiative.

• Think long-term, not short. “For the short term we may need to lose money for a quarter or two but we need to stay in business.”

• Evaluate vendors. Investigate your vendor/supplier database. “Reduce the number to three [per component]. That way, if one fails you have a backup for that product.”

CLICK HERE for Tallman’s full presentation.

“We have chosen to streamline our sales and marketing effort through dedicated partnerships,” says Adrian Vicker, divisional managing director of SIEGENIA-AUBI in the United Kingdom. “Our goal is to have a North American partner who can offer insight into their market, develop a clear sales strategy, and execute it.”

The new strategy encompasses joint marketing campaigns, co-branded collateral, and a collaborative presence at industry events and trade shows, as well as open communication between the two companies with regard to new product development, according to Interlock.

“We are pleased to have completed our recapitalization on an accelerated timeline while meeting the commitments we made to our customers, vendors and employees, none of whom were impaired as part of the bankruptcy process,” says Joe Appelmann, president of the company. “It is thanks to the hard work of our associates and the loyalty of our customers and vendors that we remain one of the leading suppliers of building materials to professional home builders and contractors. We look forward to partnering with our customers and continuing to meet their needs in the coming months and years.”

After closing operations in select underperforming markets while under Chapter 11 protection, the company is now focused on 19 core markets. These geographic markets include: Washington, D.C.; Paradise, Pa.; Richmond, Va.; Raleigh-Durham, Charlotte and Winston-Salem/Greensboro, N.C.; Greenville and Columbia, S.C.; Atlanta; Austin, Amarillo, Houston, Lubbock and San Antonio, Texas; Albuquerque, N.M.; Salt Lake City and Southern Utah; Spokane, Wash., Northern Idaho; and Los Angeles. The company also continues to operate its commercial, flooring and roofing business units.

“We believe the decisions made over the past several weeks have put the company on a path for success,” says Timothy Meyer, chairperson of Stock and managing director of The Gores Group, Stock’s majority owner. “The proactive steps Stock has taken to address the issues facing our business and the entire homebuilding industry will eliminate uncertainty about our future, an uncertainty that many of our competitors continue to face. We appreciate the support of our loyal customers and their belief in the strength of the Stock management team and our dedicated and knowledgeable associates. Stock is committed to being highly competitive in the markets in which it operates. As a result of recent actions, we’re confident the company is now well positioned to operate profitably in the current environment and capitalize on its full potential.”

Per the terms of the original transaction, and following completion of the recapitalization, Gores has invested $75 million in the company and put in place a $150 million undrawn bank credit facility. The resulting balance sheet and financial stability puts Stock in a strong go-forward position.

“While we’re always looking to improve productivity, service levels and use of information, the current economy makes it even more critical to find more ways to save time and materials,” said Ron Mascarella, vice president of systems and technology for Vista Window Co. in Warren, Ohio.

Mascarella was one of 45 people from 20 companies from across the United States that attended the three-day conference.

“We can’t stop improving,” said Toby Nichols, chief information officer for Wincore Windows and Doors in Parkersburg, W.Va. “The competition won’t.”

Continuing to improve through sharing information was a theme cited by a number of attendees. Other benefits mentioned include getting face-to-face time with FeneTech staff and providing input on upcoming improvements to FeneVision and other applications.

“It’s time well-used even though we’re busy this time of year,” said Don Montini of Interstate Window and Door Co. in Pittston, Pa.

Some may find it odd that competitors gather in a forum such as this but Ron Crowl, FeneTech president, says the company’s staff is privileged to have this type of relationship with customers.

“They help each other here and in our online forum as well as guiding us on issues and improvements,” he said.

“It’s easy to think you know everything, but through sharing ideas with the other attendees, we learn something every year that helps us work smarter,” added Mascarella.

Finally, looking at overall M&A activity in the industry, we found that such activity continues at a relatively strong pace. We have determined that 2007 was the most active year for door and window company M&A since 2000. There were 37 separate transactions that year of various sizes. In 2008, there were a total of 31 transactions, with 7 of them completed by financial investors like private equity funds and 24 of them completed by companies in this industry. In YTD 2009, we have tracked 17 transactions (4 financial, 13 strategic). While financial buyers have likely been somewhat constrained by financing availability, the fact that overall activity is relatively on pace with our busiest past year, this is another positive indicator for the industry. Combined with the slowing of bankruptcies and company closures and other positive anecdotal evidence we have gathered from industry participants, the clouds appear to part.

Note: These and other statistics were included in our Spring 2009 Window & Door Industry Update webinar, which was recorded last week and will be available at www.jordanknauff.com/windoor by the end of this week.

Effective January 1, 2017, and every three years after, a 5-percent additional reduction in energy use will be required, up until 2030.

If passed, the legislation also will impact the ENERGY STAR program, and calls for the establishment and implementation of a rating system for products identified as ENERGY STAR products “to provide consumers with the most helpful information on the relative energy efficiency, including cost effectiveness from the consumer’s perspective, and relative length of time for consumers to recover costs attributable to the energy-efficient features of those products.” This would be developed within 18 months of the enactment of the bill, “unless the Administrator and the Secretary communicate to Congress that establishing such a system would diminish the value of the ENERGY STAR brand to consumers.”

The bill also would require for a review of the ENERGY STAR product criteria for the 10 product models in each product category with the greatest energy consumption at least once every three years, and, based on this review, the criteria would be reviewed, updated and published for each category as necessary.

H.R. 2454 also would require periodic verification of compliance with the ENERGY STAR product criteria by products identified as ENERGY STAR products.

The legislation requests the allotment of $5,000,000 for fiscal year 2010 and each fiscal year thereafter for these changes.

The bill also would establish incentives for financial institutions that “develop loan products and flexible underwriting guidelines to facilitate a secondary market for energy-efficient and location-efficient mortgages on housing for very low-, low- and moderate-income families, and for second and junior mortgages made for purposes of energy efficiency or renewable energy improvements, or both.”

The bill, which was sponsored by Rep. Henry Waxman (D. - Calif.) and Edward Markey (D - Mass.), now will move to the Senate.

The House’s passage of the H.R. 2454 has met numerous responses, both positive and negative, throughout the industry.

The Aluminum Association, based in Arlington, Va., has applauded the passage of the bill, calling it an important first step in protecting the environment and potentially creating thousands of new green jobs.

“We look forward to working with members of the Senate on this important issue to further enhance the language of this bill, particularly as it pertains to energy-intensive industries like ours,” reads a statement from the association.

However, the housing portion of the legislation has garnered criticism from the National Association of Home Builders (NAHB).

“The hard truth is that we can’t build our way out of this problem,” says NAHB Chairman Joe Robson, a builder and developer in Tulsa, Okla. “We need to make sure our utilities more efficiently generate and transmit power. We need to make our existing housing stock more energy efficient. We need to reduce our ‘plug load’-home appliances, televisions and computers- and make these products more energy efficient. This bill’s focus on new home construction won’t get us very far at all.”

Door and window companies in Pennsylvania say this new regulation is good news for the state’s home improvement market.

“We are thrilled that the Attorney General’s Office is requiring contractors/dealers to register with the state if they want to do business here after July 1,” says Alan Levin, president and chief executive office of Northeast Building Products located in Philadelphia. “We are encouraged to know that people wishing to do home improvement work and or repair in our state, are now required to provide information, such as proper insurance, and their drivers licenses. This will help to reduce the chances of fraud that has become Pennsylvania’s number-one complaint with the Attorney General’s Office, surpassing automobile fraud. This we are not proud of. Anything that gets done to help maintain the credibility of our industry is a positive one.”

Tyson Schwartz, vice president of sales and marketing for Gorell Windows and Doors in Indiana, Pa., has a similar view.

“This new act, which is meant to protect homeowners from unscrupulous contractors does put the professional and honest remodeling dealers/contractors on a much better playing field. Remodelers will have to have a more open book policy with homeowners in regard to insurance, any past legal issues, any past licensing issues, etc.,” says Schwartz. “The Pennsylvania remodeling dealers will quickly adjust to the act, and homeowners will have the benefit of knowing the remodeling industry will be a much more professional and open book industry.”

CLICK HERE to register online.