What does the online shopping revolution mean for the Construction industry?

Business owners everywhere are preparing for the revolution of change resulting from approximately 51% of all consumer purchases being made online versus inside a brick and mortar store.  A 2016 study by comScore, an analytics firm, estimates that this number will continue to grow by at least 1% every year.  Consultants are working to prepare retail business owners for the impact of this increase by helping them integrate a strong online presence and to help them understand what measures can be taken to bring foot traffic into their storefronts. This topic has been examined from many angles to determine the impact on different areas of our lives both personally and professionally; but what does this mean for the construction industry? What are the benefits and opportunities that could come of this?

Small business owners of multiple industries are the first to take the hit.  Going to a print shop for your business cards and photo printing is a thing of the past, and these days, so is going to a home décor store, gift shop and clothing retailer.  Consumers can find exactly what they are looking for by simply typing it into a search engine.  Within a matter of seconds, they see what they are looking for available at multiple retailers and for various prices.  This allows the consumer to shop for the best deal and fastest shipping speed before making their purchase.  Online giants like Amazon have set the industry expectation that online purchases will arrive at your doorstep within two business days, with shipping costs included in the product price. Other companies like Wal Mart are quickly following suit as not to lose out to the competition.  Studies show fastest shipping speed is more important to the consumer than a price point that is 1-5% higher for the product.  Consumers can even grocery shop online now, having fresh produce and food delivered to their door in two business days – or picked up curbside at the grocery store! With the direction we are moving with these modern conveniences, taking an afternoon stroll visiting storefronts in your local downtown area are becoming a thing of the past.

“We all know online retail is hurting the business of physical department stores. Instead of phasing out these stores 100%, they are building new creative flagship stores in places like the woodward avenue corridor, while the big boxes and malls empty and close. This is unfortunate for the retail industry, and for builders who specialize in the big-box retail model, but for custom and boutique contractors, it can actually open doors on some interesting projects.” -Stephen Barcus, Project Engineer, MiG Construction

There are some benefits to the construction industry resulting from this change because as more retailers add a warehouse for order processing and shipping, more buildings will need to be renovated and built.  In addition to warehouse space, online retailers frequently need an accounting/customer service building as well that are sometimes at different locations. Though this may seem like a hassle to the business owner, their costs could actually go down from having to rent prime location space for their storefront.  Warehouses can be built anywhere without concern of the population/demographic of shoppers. In addition to warehouses, shipping companies are building more warehouses as well to meet the demand of the famous 2-day shipping deadlines and the overall increase in packages.

“Following a decline of 2 percent in 2016, non-residential construction output is expected to rebound this year, expanding by 3.7 percent. The institutional segment was the only area of growth for the industry in 2016, and government stimulus spending will help the institutional segment grow by 6.8 percent this year. Beyond 2017, however, the institutional segment will provide a smaller boost to the industry, as government stimulus spending is projected to unwind.

Providing support to the industry’s commercial segment is the rise of online shopping, which is beginning to see a faster rate of adoption in Canada. This will help support a U.S.-style buildup in warehouses across the country.” -NBC 2 News

According to an article by the Wall Street Journal, the digital market place is having a physical impact on urban landscapes. Throughout the U.S, industrial pockets are seeing a “economic renaissance” reports the article’s author, Erica E. Phillips.  We imagine that store fronts will also need to be renovated as they close down, perhaps we will see an increase in restaurants, shared office spaces, administrative buildings and more.

It’ll be exciting to see what happens as these areas morph into the new age- but sad to see more and more shops close doors.  With the close of every era, comes a new one for us to enjoy!

-Robin Slawnyk, MiG Construction

 

 

 

 

 

 

 

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What does the online shopping revolution mean for the Construction industry?

National Take Your Child To Work Day 2017!

Here at MiG, our employees feel so blessed to work for a company that is so family oriented!  One Staff member asked President Brian Deming if she could bring her kids in for the day, and his response was “Please! We would love that!”

We had a total of 4 kids in the office with us today, ages 4, 5, 6 & 7!  Our Junior TeamMiG participated in some paperwork, they had a meeting, did some in-office courier work and became masters of three-hole punching and printer fetching!  Here are some photos we took during our special day!

Using blueprints to build a horse stable

“I want to be an Engineer when I grow up”

Having an important safety meeting and dressing up in MiG Gear!

Another great day at MiG Construction!

National Take Your Child To Work Day 2017!

Meet Timberly, our Controller

Timberly has been with MIG Construction for fifteen years and in the construction industry for twenty. She has been married for twenty-four years and has two children and four grandchildren.  She and her family enjoy Detroit sporting events (Go Tigers!), Casino Life at MotorCity, MGM and Greektown, and Campus Martius.

When she’s not at work you can find her working on her yard and pond projects and spending time with her family.  In the summer she and her family enjoy their annual camping trip!

A typical day at work for Timberly looks like her at a desk full of paperwork and a line of people at her door! She’ll tell you that she truly enjoys the people she works with and that it’s great to be a part of a team that care about doing their best to promote the growth of our company.

Timberly’s co-workers know they can count on her to help out whenever there is a question – she is always happy to take the time to work with everyone.  We also know we will be greeted by her smiling face when we walk into her office!  Timberly is an asset to our team and we are so happy to know her and work with her!

 

Meet Timberly, our Controller

What’s with the Construction Labor Shortage?

While the children of our generation are dreaming of being Doctors, Lawyers and Business Executives – the construction industry is wondering; who will take our place?  Labor shortages are no stranger to this industry anymore and 2017 is already struggling because of it. It’s easy to see this issue on the rise as we find it less and less popular for Construction to be a family business, a taught skill in schools – or even a hobby for the youth.  A lot of America’s youth are occupied with extra-curricular activities at school, enjoying social media and video games instead of working on the house with a family member and learning trades from the ground up.  It’s got us wondering – is skilled labor soon to be a lost art?

Opinions on this matter are all over the map.  Some millennials feel that it’s ok that a labor shortage is on the horizon, some believe that there are other things on the horizon that will take their place; such as 3-d printers or robots.  “3d printers will be building all of the custom designed homes of our future”; one visionary said.  One the contrary, our opinion is that we have to believe and argue – that no piece of technology can replace the craftmanship of a true carpenter – pounding his life’s experience and visions into every nail.  We can’t imagine the quality and integrity ever being the same!

In my opinion, one of the underlying issue as it pertains to the labor shortage throughout the US, is the loss of vocational programs in the school systems. The vocational programs are being deprioritized at schools, all at a time when many skilled tradesmen are making $100,000 a year. Students are increasingly being told that they need to go to college to be successful, which may or may not be true depending on the field of employment that is sought. There are many students who would greatly benefit from exposure to different opportunities and a different path in school, not to mention the lucrative job opportunities available in the skilled trades. -PJ Jenkins Jr. MIG Director of Strategic Growth and Business Development

As reported by the Bureau of Labor Statistics and National Association of Home Builders (NAHB), an estimated 143,000 open construction opportunities are available across the nation.  It’s easy to assume that there should be an abundance of workers looking for construction work considering that people across the country report trouble finding jobs.  However, because the construction industry lost 2.7 million jobs between 2006 until 2012 during the recession, a lot of skilled trades workers were forced to leave the industry and seek work elsewhere.  The end result is that most of them have settled into new careers and never returned to their skill sets. Combine this with our previous mention of how the latest generation of youth aren’t aspiring to join this industry, how schools have cut programs that encourage development in this area – and how families are not passing this trade down the generations like they used to; we are faced with the shortage we now anticipate to increase over the years.

From the recession until now, there are still nearly 1 million fewer residential construction jobs and nearly a half million fewer commercial construction jobs available on the market.  Why? Because it is so hard for companies to find skilled workers, job completion rates have dropped and some companies are taking on fewer projects.  Additionally, a lot of small businesses were forced to close their doors and weren’t able to reopen.  This doesn’t mean that the jobs went away – because people are continuously seeking out contractors when work needs to be done.  It does mean that these jobs are costing the consumer more because the demand is high while the supply is low.  It also means other companies are facing higher demand and need to increase their staff to accommodate – and clients are waiting longer to launch their projects. Companies report that applicants flood in for open job postings; with a mere 5% of them qualified for the position that is being offered.

“The building industry is a great place to get started in the working world with a good-paying job in an honorable profession that has a path to advancement. We need to tell that story.” – John Courson, President and CEO, the Home Builders Institute

Companies fear that this is just the beginning of the labor shortage and hope to spread the word to communities to reconsider this as an honorable profession.  So much pride comes from building something that becomes a part of history.  A building in which celebrations will happen for years to come, hospitals where lives are saved – homes where memories are made!  It’s incredible to be a part of those things.

Building demand is projected to continually rise over the coming years. Maintaining this shortage will only ensure one thing – development will decrease, home prices will increase and building new business space may become un-affordable to aspiring business owners – which means fewer jobs for our future youth.  Construction is the foundation of everything.  The homes we live in, the restaurants we dine in, roads we drive on – places we work.  It’s time to remind the world of where it all begins.  Right here.

-Robin Slawnyk, MiG Construction

 

What’s with the Construction Labor Shortage?

Staff Spotlight: Meet our President, Brian Deming

Brian Deming, President                         Staff Spotlight – April

Brian has been with MIG Construction since 2007 – in which time he’s applied his previous experience in the industry to enrich our environment, and learned things from us that have advanced his experience.  It’s been a great partnership and we look forward to several continued years with him leading the team!

 

Brian is a respected leader within the company and he does a great job extending his experience and knowledge to our appreciative staff.  A day in the life of Brian is pretty busy!  In addition to being President of the company, he does some work as Project Executive/Manager on many of our projects!  Brian would say that his favorite part of his job is building and supporting teams to create great projects.

Before MIG, Brian worked for Giffels Associates (now IBI Group, Southfield).  He is a graduate of Wayne State University (Go Warriors Tartars!) and has lived in and loved the Detroit area all along.

Brian is enjoying getting his oldest off to College and watching youngest in Gymnastics competitions.  He is a proud father of two daughters, He enjoys backpacking, running and watching Detroit sports teams.  His favorite landmark in Detroit is the Guardian Building.

Brian’s employees say that he is a great role model within the company and cares very much for the success of his Staff.  They note that he works tirelessly and with great effort to meet deadlines and to wow the Clients.  Another of his employees remarks that regardless of the day, time – or workload – he always has a smiling face and willingness to help/direct any way that he can! Brian is a fundamental part of the positive work environment available for #TeamMIG!

Thanks for taking the time to meet Brian!  Every month will feature a new staff member, so check back for updates!

Staff Spotlight: Meet our President, Brian Deming

A closer look into Hospitality Construction

CONTRACTOR TALKPJ Jenkins Jr, answers some questions from Bodman Law legal expert and Treps Nest co-founder Michael Melfi about hospitality construction trends, the challenges of the building process, and he tells how differentiates itself in the busy hospitality sector.

Michael: What hospitality design and construction trends are owner/operators in search of?

PJ: The trends in the hospitality sector are shifting dramatically in a very cool, progressive way. For that reason alone, we are seeing a lot of different requests come through our office. Instead of the communal tables and large spaces in which was a big trend years ago with the Starck designs, now owners are asking for intimate spaces with open kitchens and private chef’s tables to really showcase the chef and the art of cuisine. With today’s reality world featuring many celebrity chef’s the hospitality world has become an industry designed around the chef’s needs. From a building materials standpoint, we are seeing a lot of action with subway tile and reclaimed wood mixed with a unique millwork style that fill in the property, such as at Greenspace Cafe in Ferndale, Michigan. I worked closely with project designer and architect John Janviriya of JJV Design in taking a raw 4000 sq ft space and cross utilized materials to create a beautiful plant based restaurant.  Other creative design elements we have seen incorporated within the design theme is the incredible space at Buddakan in New York where the entire space is the wow factor but the use of a custom functional buddha cabinets throughout are also a big trend we are noticing lately. Another big trend we are seeing being implemented are the “GREEN” design restaurants like The Plant Cafe Organic in San Francisco, which has a solar system on the roof to power their kitchen. It is certainly exciting to see designers and contractors working together to create such unique spaces.

We are also seeing some very cool and unique trends in the the bar game within the restaurant and we are fulfilling a multitude of requests for this specific area. In particular owners have begun to implement and create more cool mixology beverage programs. The best I have seen is the Aviary in Chicago. This place is a sophisticated open cocktail kitchen that takes the term mixology to a new height.  Having a trend in the restaurant and bar side makes building a venue exciting as it’s like building two venues under one roof. We feel fortunate to be a player in this space. It gives us builders who enjoy the creativity a chance to showcase our unique style of building.

Michael: What are the three biggest challenges of hospitality construction and why?

PJ: I would say the biggest challenge is for sure the actual coordination of the project— the amount of mechanical, electrical and plumbing (MEP) associated with a project usually make up about half of the entire project budget. These elements take up large areas within the walls and ceilings, and our goal as contractors is to make these pieces disappear so it isn’t visible to the customer enjoying their meal or create a space that exposes the MEP’s in a creative way by design. So basically, along with being a contractor we are also magicians’ ha!

Another challenge is the idea of making sure all key components within the property are meet the requirements associated with each individual use. For example, the requirements for the dish washing room are much different than the requirements for an open kitchen, and even more so than the fabric and materials that occupy the main dining area. All these elements need to work together in terms of durability, function, and how they will be utilized by guests.

Lastly, and most importantly, is making sure the contractor, owner and architect/designer are all in sync well in advance at the time of signing the lease for the space. This part is crucial. If there is a gap in communication in the slightest bit, the project could be delayed significantly and the budget could get out of hand in which we try to avoid at all cost. I suggest to owners to find a group that has an existing chemistry. Projects are much smoother when all parties developing the project have been on the same playing field before.

This sounds like a simple concept, but often, owners are moving forward with brokers who are pushing their own agenda to try to get the deal closed. It’s not uncommon for owners to be brought into a property that doesn’t have the core elements necessary to make it a restaurant. Things like having exhaust assemblies for going to the roof, proper water line size, and even sprinkler systems are not the broker’s focus when trying to close a deal. Brokers are very helpful when looking for potential spaces but my advice is to make sure not to move too fast and involve an architect/designer and/or a contractor in the process from the very beginning, you’ll be able to prevent yourself from making these very costly mistakes.

Michael: What kind of things has MIG done to differentiate your business from others that focus in the same market?

PJ: We have developed several hospitality projects around the world and each project is unique. Different rules, different markets, different designs. So, when we get a hospitality project we are dedicated to the owner to make sure they can be successful. An advantage we have is that we have been on every side of the hospitality business; from ownership to consultant to developing the concept to building the space, we understand the ownership side in which creates sensitivity for any project. Our value engineering practices is also an area in which we differentiate ourselves from others in the industry. While we can save money, it is imperative that we preserve the design intent. This means we find creative ways to switch out products that offer a significant cost savings while maintaining the integrity of the project.

Additionally, with regards to our company, one of the main focuses we have is making sure all of the owners and the key staff members are involved in the process. It’s important to us to make sure that the kitchen is set up for the chef, rather than meeting the general manager’s criteria, or even the owner’s criteria in some cases. We make sure each area is setup to meet the needs of the team who will occupy and make the decisions in the space.

As we have been a part of many hospitality projects in major markets we have a keen eye for the necessities. We are always looking to implement ideas that do not cost the owners extra money, while still making a property functional. Providing this service means the owner doesn’t have to spend additional money for a beautiful space that is functional for both restaurant staff and its guests.

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PJ Jenkins, Jr. is the Director of Strategic Growth and Business Development for MIG Construction, a commercial general contractor and construction management firm with offices in Detroit, Michigan and Atlanta Georgia. To learn more, visit www.migconstruction.com and  www.migsouth.com

 Michael S. Melfi is an Intellectual Property attorney at Bodman Law and Co-Founder of Treps Nest.  Michael has a dynamic background that allows him to provide insightful legal services, while creating business development strategies for funding and growth. To learn more, visit www.michaelsmelfi.comwww.trepsnest.com

 

A closer look into Hospitality Construction