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Camden NJ Demo Bids Due
September 9, 2009
10:43 AM
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I just finished reading the article and this is one of the best written columns that explain the current US demolition industry issues that I have read.

We feel that if the US demolition industry cannot figure out what the future trends are - the industry will always be a follower – reacting to what clients, competition, and vendors do, and results will be mediocre at best.

We have also heard and read comments that this bidding war has been going on for years in the US demolition industry. This may be true as it appears that some industry executives have promoted such heinous acts as massive downsizing, crisis driven cash-flow operations, and insane bidding strategies. These failed strategies have wrecked fine organizations and have hurt productive and loyal employees.

We wait with great anticipation to read other comments as it is time to very seriously address these issues…….

September 9, 2009
8:51 AM
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Make your feelings known on the bidding war.

September 8, 2009
10:25 AM
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You're partly right in your understanding of the UK demolition business; there certainly are a lot of family-owned companies that can trace their heritage back two, three and even four generations. However, I am yet to meet a demolition professional with the title Sir; they're generally a wee bit more rough and ready than that!

That said, there are also some very good "first generation" contractors out there; companies like AR Demolition that take a really intelligent and professional approach to the business.

I would like to pick up on your point about regulation, though. One area that interests me is the likely effect of ever tightening regulation. It is my fear, particularly in the midst or immediately after a recession, that it will be the big players that are best equipped (and have the cash) to adapt to more stringently-controlled work practices. But where does this leave the small, local and professional contractor? Do they get swallowed up by the big boys or does their inability to invest in the training and equipment required mean they'll just wither and die? Neither sounds like a great option to me.

September 8, 2009
8:04 AM
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When the economy starts to pick up the bids will slowly start to go back up and all the excavation contractors,landscapers, asbestos contractors,will all go back to what they normally do,just like they did in the recession of 82-83 ,90-91, 96-97 , 2001,.Here in the U.S. you can start out small and work your way up the ladder. From what I have seen and been told about the UK if your great grandfather didnt have a sir before his name you don't have a chance of getting started over there. Sooner or later The U.S, will be regulated as much as western europe and all the established contractors will have the advantage and it will be a big club like the UK. Well I have to go now my new assault rifle came in and I want to shoot it in the back yard.

Dengler Demolition

September 7, 2009
11:26 AM
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demolitionnews;12682 said:
...... clients will become accustomed to this new, super-low level of bidding and, even if there is a sudden and marked upturn, it will take months and possibly years to redress the balance.

If, however, they're forced to cut corners in training and site safety, or if they're forced to lay off parts of their workforce, then I am considerably less comfortable with it.

And I am NOT happy that this low-bid trend will open the way to unprofessional and even unscrupulous practices.

This, unfortunately is the way of EVERYTHING these days. No one pays top dollar, no one is buying new cars, no one is renovating their homes, spending is at a standstill. I go to my local DYI warehouse and get swamped by a dozen employees if they can be of any assistance as I look for a screw to fix my front door.

Even in my business, the only way to even survive is to undercut, low bid and compromise. Three years ago I had to throw my entire pricing structure out the window and cut my rates by almost 50% in order to get any work.
I had to suck it up and realize that I would rather work for next to nothing than not work at all.

In fact the video side of what I do is relatively new to what I offer. What began as an 'experiment' has now become more of what I do than straight up still photography.

While the development of the digital camera seems like an natural progression in the evolution of the visual image it has for many out there become certain death financially.

Now everyone out there with a 10MP digital camera is a 'expert' in the field.

Fellow photographers of mine are going under left and right because long standing clients of theirs are going else where for images. It is a fact that even in my industry they are going with the lowest bid, regardless of experience, talent or professionalism.

The worst of it is..... I'm sorry 'John', but I know we have done business for the last 15 years and you have always done our photography but we just can't afford to spend any money in marketing right now. In fact, my wife just took a weekend workshop and she is going to do the work for $400 instead.

That's the way it is..... we, everyone, all industries are cutting back doing it for less, doing it for nothing, and while taxes are going up and expenses are the same its not going to get better anytime soon.

September 7, 2009
7:27 AM
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Stephen,

A well-considered response as ever, and I am sure there's a lot of truth in what you say. However (and this is the crux of my concern) clients will become accustomed to this new, super-low level of bidding and, even if there is a sudden and marked upturn, it will take months and possibly years to redress the balance.

I am also concerned at where these apparent "savings" are being made. If contractors have made savings on, say, fuel and this is allowing them to work for less, then fine. If, however, they're forced to cut corners in training and site safety, or if they're forced to lay off parts of their workforce, then I am considerably less comfortable with it.

I really don't want to be seen as anti-US - Far from it. I am yet to meet an American that I didn't like and I jump at any opportunity I have to visit your country. My sole concern is the long-term impact of the current recession on the profitability and overall safety of the industry.

I am NOT happy that there are approximately 7,000 US demolition workers who find themselves unemployed through no fault of their own. I am NOT happy at the thought that safety might be compromised to cut costs. And I am NOT happy that this low-bid trend will open the way to unprofessional and even unscrupulous practices.

September 7, 2009
7:03 AM
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demolitionnews;12672 said:

But in my opinion, none of that is anywhere near as important as the underlying issue here. Bids are coming in WAY below estimates. And while I accept that these estimates are far from being 100% accurate, I do not accept the fact that a 20-% differential between estimate and bid price is healthy for the US demolition business. Nor do I believe that demolition technology shifts sufficiently in the 6-12 months between estimate and bid that would make this difference justifiable.

Mark,

I know what you are driving at and over-all the facts are quite disturbing but I think you are looking at it all wrong.

All your articles having you throwing your hands in the air asking why this and why that... as if you woke up from a 10 year old sleep and are just stumbling onto the scene.

The justifiable difference is simply the state of the economy, nationally and internationally, from where we were a year ago, 3 years ago, 5 years ago.

All the jobs that demolition contractors have been working on in the last 2 years were set in motion before the crash of the metals market came about.

Bids came in at a higher rate because at the time it was justified to do so.
Profitability, manpower, machine power, spending were all part of the bid package with a look to the future to be able to make the company grow, expand and flourish.

To bid on a job today you are doing so to keep the company afloat. Enough to pay for the workforce, the fuel costs, keep the equipment running and paid for and maybe break even. No, not good for the US Demolition Market but a necessary evil to make it work.

Today we have a National Holiday here in the states ( a bank holiday as you call it) that is called Labor Day. Labor Day celebrates the American Workforce. In part it signifies the end of summer, the start of the school year the beginning of the march into colder months, towards spending time with family our winter holidays of Thanksgiving and Christmas.

In today's online newspaper the Boston Globe the headlines states
On this Labor Day, 5 million Americans have been out of work for more than six months, a record number that forecasts a slow, difficult recovery.

The last huge stock market crash robbed most people's retirement savings of almost 60-75% of the value. And that was before they were laid off.

Job layoffs here in the USA have been rampant for the last 2-3 years.
Businesses are still closing, bankruptcies for even what it seems solid corporations are happening across the board.

The bankruptcy of General Motors here is the states has put even more people out of work and closed numerous plants. You might think, well there's an opportunistic market for demolition contractors. Well yes and no. Until the restructuring of GM plans for the demolition of any plants are put on hold, for how long ? Years probably, maybe longer.

September 6, 2009
9:40 AM
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As I guess I am probably perceived as the leader of the "web-based assault on US demolition contractors", I just wanted to respond to that latest thread.

All that Stephen says is 100% correct. The US is considerably larger than the UK, and both countries are separated by more than a single language. Despite this, however, it is still most often the case that those UK contractors based in the South (for example) will win the work in the South while work in Scotland is generally awarded to Scottish contractors.

But in my opinion, none of that is anywhere near as important as the underlying issue here. Bids are coming in WAY below estimates. And while I accept that these estimates are far from being 100% accurate, I do not accept the fact that a 20-% differential between estimate and bid price is healthy for the US demolition business. Nor do I believe that demolition technology shifts sufficiently in the 6-12 months between estimate and bid that would make this difference justifiable.

As part of my running of Demolition News, I am monitoring the US press and these "bids well below estimate" stories are now so common that they're becoming the norm.

Furthermore, I have just received details of yet another one from an anonymous (but US-based source) with a message attached that read, simply: "US contractors in denial".

Just one final point, just to set the record straight. As I have said previously, I have enormous respect for many US demolition contractors. And while I am delighted that the NDA has decided to adopt two of the UK machine guidances that I helped write, I do NOT believe that the UK always knows best. However, in the same way I would question the use of bamboo scaffolding on a contract in China or India, I believe it is only healthy to discuss a pricing practice that will ultimately impact upon the livelihood of demolition workers, whether they're in the UK, US or anywhere else for that matter.

September 5, 2009
12:00 PM
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James;12633 said:
Mark,

Also a lot of those

September 3, 2009
2:27 PM
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Brandenberg is the biggest wrecking company in the U.S. at the moment. "Bobs" landscaping didnt steal that one away from a legitimate wrecker.
Dengler Demolition

September 3, 2009
6:54 AM
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I think you can ignore that last post as my system now seems to have caught up!!

September 3, 2009
5:37 AM
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On the basis that my last post/response has now vanished, can I assume that I am now being "censored"?

September 3, 2009
4:03 AM
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September 3, 2009
3:02 AM
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As a journalist of some 25+years, one of my key goals is to illicit a response or an emotional reaction. And having just read your latest reply, I can tell you that you achieved precisely that: I have gone from astounded to staggered to deeply disappointed in just a few short paragraphs.

I am not going to go through your points individually as I am sure we all have better things to do. But to suggest that it's OK for Bob's Landscaping to tackle a major demolition project if he has the finances in place is probably one of the most disturbing things I have heard for many years.

Demolition remains a tough, hazardous and potentially lethal industry in which to work. And to suggest that someone without the proper training and experience can then pop along, wave a bond in the air and then get on with a MAJOR demolition project in a safe manner is quite frankly ludicrous. If this were true, then demolition companies could help recoup some of the losses made on these low bid projects by simply canceling all their training and selling their specialised demolition equipment and just buy a few backhoes and hope for the best!!

And your argument that "it's been like it for years" just doesn't hold water as far as I am concerned. Men were dying on demolition sites for years but, thank to a few forward-thinking and like-minded individuals, systems were put in place and training was instigated to minimise the risks. As a result, the vast majority of the world's demolition workers know that when they leave for work in the morning, there's a very good chance they'll be going home again.

I am also disappointed that you have chosen to criticise the aims of my audio podcast without actually hearing it all the way through. You're probably also unaware that we have also run a 10 minute video presentation by Mike Taylor in which he states his case without any questions from me. And, unprompted, he decries the current economic situation and calls for a global sharing of information, precisely the aim of my podcast and website.

I have enormous respect for many of the individuals that post threads here at demolitionforum, and I greatly value their views, even if they don't always match my own. But my understanding of a forum was that it was a place for discussion, not just a place to share niceties while the industry from which we all derive a livelihood suffers the worst recession in living memory.

September 2, 2009
4:06 PM
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demolitionnews;12634 said:
Another key point raised by Mr Taylor was the fact that some of these demolition projects are attracting bids from "Bob's Landscaping". Ours is an industry that has long striven to improve site safety and reduce accident rates through a mixture of training and ever increasing professionalism.

Are we to stand idly by while "Bob" and his like undermine the profitability and possibly survival of legitimate demolition contractors whilst quite possibly putting their own lives and the lives of other in danger?

Again this has been happening for years, you're talking in circles here. There have always been the Bob's out there and there always will be, and there's pretty much nothing you can do about it.

But let's take your analogy, so if "Bob's Landscaping" submits the lowest responsible bid, the owner should through their bid out?

What if Bob does has the financial background, bonding, and the like?

Again look at the bidder's on these large projects, I see legitimate companies bidding on them, not "Bob's Landscaping".

Again, a lot of these contractors started out as "Bob's".

There is no so called US bidding war going on! It's just the nature of the industry and you seem to be the only one asking about it.

PS - I will give some leeway, I didn't listen to the whole podcast, because I could already see where it was going and I couldn't stand listening to it anymore.

September 2, 2009
3:54 PM
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I don't know what you mean by cool with that?

I think you are missing the point, if a client sets aside 6 million dollars for a project, does that mean I should bid 6 million for that job? No! Again where are these estimates coming from? Most are coming from engineers that know nothing about demolition.

So if everyone's bids come in under the estimate of 6 million they should be thrown out because that is what the client set aside?

Look if bid affects a winning bidder's profitability, isn

September 2, 2009
1:48 PM
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So the low bid was almost 8% inside the next lowest bid, came out at roughly a quarter of the high bid and almost half costed this at a $2 million-plus job.
Is everyone cool with this? Did I miss a meeting?

September 2, 2009
1:39 PM
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PROJECT: Riverfront State Prison
SERVICES: Demolition Engineering

Brandenburg Industrial Serv. Co. Bethlehem, PA $1,254,000.00
Titan Wrecking, LLC Kenmore, NY $1,359,013.00
National Salvage & Serv. Clear Creek, IN $1,364,000.00
Site Contractors Hammonton, NJ $1,499,000.00
Nova Devel. New Brunswick, NJ $1,548,000.00
Robert Winzinger Inc. Hainesport, NJ $1,643,000.00
Hudson Valley Environmental So. River, NJ $1,741,000.00
LVI Mazzocchi Wrecking E. Hanover, NJ $1,795,000.00
Nacerima Environmental Bayonne, NJ $1,796,007.00
NASDI Waltham, MA $1,885,000.00
Geppert Brothers, Inc. Colmar, PA $1,987,000.00
S & R Corp. Lowell, MA $1,998,965.00
Haines Kibblehouse, Inc. Skippack, PA $2,171,242.00
CAP Demolitiion Belleville, NJ $2,180,000.00
Terrasan Environmental Sol. Old Bridge, NJ $2,455,444.00
Homrich, Inc. Carleton, MI $2,486,000.00
A.P. Construction, inc. Blackwood, NJ $2,542,200.00
Sabre Demolition Corp. Warners, NY $2,587,680.00
R. Baker & Son Red Bank, NJ $3,118,400.00
Safeway Environmental Bronx, NY $3,234,000.00
Gramercy Westbury, NY $3,266,000.00
Slavco Construction Clifton, NJ $3,947,500.00
W. Hargrove Demolition Camden, NJ $4,869,130.00

September 2, 2009
10:53 AM
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The client has set aside $6 million and the low bid comes in at a fifth of that and you're worrying about defining what constitutes a low bid?

I know things work differently on either side of the Atlantic but how can a forum that was presumably established to further the cause of US contractors condone a system of bidding that will have an immediate and negative impact upon the winning bidder's profitability, and will have a far reaching impact on the wider industry possibly for years to come.

Although they weren't commenting on this specific project, Mike Taylor and Ray Passeno from the NDA readily admit that contractors are submitting low bids merely to keep men and machines working. And whilst I certainly wouldn't blame these contractors for doing so, surely I cannot be alone in seeing that this short-term gain will ultimately lead to a longer term loss.

As for "stirring things up", I believe that my job as a journalist is to question the spokespeople of the industry to get their take on the latest issues, trends and topics. Both Mike Taylor and Ray Passeno gave freely of their time and were only too pleased to answer my questions.

Another key point raised by Mr Taylor was the fact that some of these demolition projects are attracting bids from "Bob's Landscaping". Ours is an industry that has long striven to improve site safety and reduce accident rates through a mixture of training and ever increasing professionalism.

Are we to stand idly by while "Bob" and his like undermine the profitability and possibly survival of legitimate demolition contractors whilst quite possibly putting their own lives and the lives of other in danger?

September 2, 2009
9:26 AM
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Mark,

I am not sure of your agenda here, but I'll bite.

First what constitutes a low bid in your mind?

If you are basing low bids on the engineer

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