" 1 996 was' one of the best yearswe've had in five years," saysRob Therrien Jr., president

of AI Melanson Co. Inc., Keene, N.H.For the most part, roofing contrac-

tors agree with Therrien-1996 wasan excellent year, though it doesdepend on regional and local fac-tors. This optimism is consistent withNRCA's 1996-97 Annual Market Sur-vey: The 1996 dollar volume of workrose in the United States to $19.6 bil-lion, a $1.25 billion increase from1995. However, during 1997, the dol-lar volume of work is predicted todecrease to $18.2 billion.

During 1996, a significant increasewas recorded in the South (52.5 per-cent), with a moderate rise in theWest (8.4 percent). The Northeastand Midwest, on the other hand,experienced declines of 35.6 percentand 9.4 percent, respectively.

SURVEY BACKGROUNDNRCA's fmdings for the 1996 U.S.roofing market and projections for1997 are based on about 500 re-sponses to a questionnaire that wassent to 5,000 commercial and resi-dential roofing contractors through-out the United States, includingNRCA members and nonmembers.

About 89 percent of respondentsare company officers. Reportedannual sales volumes are as follows:less than $1 million-36.7 percent;$1 million to $3 million-32 percent;$3.1 million to $8 million-25 ~r-cent; $8.1 million to $12 million-

by Sandy Burns and Marl A. Paulson

4.1 percent; and more than $12 mil.lion-2.2 percent. Most of the re-spondents' companies have been inbusiness for 11 to 20 years (27.6 per-cent), though 25.6 percent havebeen operating 10 years or less and19.7 percent, 21 to 34 years.

The survey sought informationabout contractors' total sales, thetypes of materials used, percentageof commercial and residential workperformed, and percentage of newconstruction vs. reroofing work. Con-tractors' projections for 1997 alsowere included. In the survq, con-tractors were asked to report oncommercial and residential work,not low~lope vs. steep-slope. Forexample, a commercial establish-ment with a steep-slope roof wouldbe considered a commercial project.

Survq results are designed to pro-vide market information; however,the data are not statistically signifi-cant. Because the United States wasdivided into only four regions forthis survq, there are wide variancesin responses, depending on contrac-tors' locations.

Single-ply roof systems captured37 percent ($1.28 billion) of the newconstruction market, a decrease from40.5 percent ($1.27 billion) in 1995.For reroofing, these systems account-ed for 31.2 percent ($3.24 billion) ofthe market, compared with 32.7 per-cent ($3.09 billion) in 1995. Roofingcontractors predicted that these per-centages will remain relatively un-changed during 1997.

During 1996, BUR was behind sin-gle plies, with 24.6 percent ($850million) of the new constructionmarket and 29 percent ($2.99 bil-lion) of the reroofing sector. Similarto the single-ply market, BUR'smarket share is expected to remainrelatively stable during 1997.

Modified bitumen roof membraneusage during 1996 was about the sameas last year in the reroofing segment-23 percent. However, in new construc-tion, its use jumped from 16.9 percent

in 1995 to 21.2 percent in 1996. APP-and SBS-modifieds were employedalmost equally. Contractors expectthat in reroofing, modified bitumenusage will increase to 23 percent ofthe market, and in new construction,decrease to 18.7 percent.

Sprayed polyurethane foam (SPF)captured 2.5 percent of the new con-struction segment (which is consis-tent with 1995); for reroofing, SPFusage was 3.4 percent, up from 2.6percent in 1995. Liquid-applied sys-tems remained relatively even withlast year's numbers: 1.2 percent innew construction and 2 percent inreroofing.

As for metal roof systems, they gar-nered 3.9 percent of the new con-struction market and 2.5 percent ofthe reroofing segment. Architecturalmetal roof systems were used slightlymore often than structural systems inboth markets.

THE COMMERCIAL SECl'ORThe commercial market weighed inat $13.9 billion (70.9 percent) in1996, an increase of $700 millionfrom 1995. Contractors projectedthat commercial work will decreaseto $13.18 billion during 1997.

Once again, reroofing dominatedthe commercial sector in 1996,accounting for $10.4 billion (74.8percent). The remaining $3.5 billion(25.2 percent) was spent on new con-stmction work. Of the reroofing workperfonned, tear-offjreplacement wasthe most common at 62.5 percent,consistent with 1995's figure.

Similar to last year, the Northeastreported the largest margin of differ-ence between the percentage ofreroofing (79.7 percent) and newconstmction work perfonned (20.3percent). The South had the small-est margin of difference betweenreroofing (70.4 percent) and newconstmction (29.6 percent).

Survey respondents reported thatsingle plies (e.g., EPDM, C$PE[Hypalon8] , PVC), built-up roofing(BUR) and modified bitumen con-tinue to be the leading systems in thecommercial marketplace.

April 1997 Profession4l Roofing 19

million) of the total asphalt shinglemarket, and organic shinglesaccounted for 9 percent ($90 mil-lion). Tile captured 7.6 percent ($80million) of the market, a 1.3 percentincrease from 1995, while commer-cial material usage on residential sys-tems increased about 1 percent.

Survey data showed that there wasa 212 percent increase in residentialwork during 1996. This is more con-sistent with 1994's figure; during1995, contractors in the South saw a$659 million decrease in this seg-ment-from $1.193 billion in 1994to $534 million in 1995.

On the other hand, roofing con-tractors in the West saw the largestdecrease in residential roofingwork-from 39.1 percent in 1995 to33.5 percent in 1996.

According to the 1996-97 marketsurvey, roofing contractors in theWest experienced the largest in-crease in the overall commercialroofing market ($400 million) whencomparing 1995 and 1996 survey fig-ures. Meanwhile, roofing contractorsin the South saw the largest decline-$1.55 billion.

PREDIGrIONS FOR 1997Unlike the past few years, surveyedroofing contractors predicted a 7percent decline in 1997's U.S. overallroofing market to $18.22 billion.This can be attributed, in part, to thepessimism of those contractors doingbusiness in the South-they project-ed a 22.2 percent decline for 1997.

Commercial work is expected toaccount for 72.3 percent ($13.2 bil-lion) of the total roofing market.This figure is consistent with 1995,when commercial roofing was 71.9percent. Respondents believed thatnew construction and reroofing inthe commercial market will dropslightly from 1996's numbers to $3.3billion (24.7 percent) and $9.9 bil-lion (75.3 percent), respectively.

Contractors in the Midwest pre-dicted increases in the commercialmarket, while those in the Northeast,West and South believed there willbe declines during 1997.

Based on survey data, material usein the commercial new constructionsegment is expected to remain con-sistent with 1996 figures. Contractorsdid predict, however, that modifiedbitumen usage will decrease by 2.5percent in this market.

For commercial reroofing work,contractors said BUR systems willgarner 29.8 percent of the market(consistent with the 1996 figure).Single plies will hold 29.3 percentof the market (a 2 percent decreasefrom 1996), followed by modified

THE R~mENTIAL SECfORThe residential roofing marketchecked in at $5.7 billion (29.1 per-cent), an increase from last year's$5.15 billion.

Consistent with the past couple ofyears, survey respondents reportedthat reroofmg captured a majority ofresidential business--82.5 percent($4.7 billion)-with new construc-tion representing 17.5 percent ($1billion) of the market.

Of the residential reroofing workcompleted, tear-ofIjreplacement wasthe most popular at $3.6 billion (77percent), which is a slight increasefrom last year. Re-cover work de-creased during 1996 to 23 percent($1.1 billion).

As for reroofing materials, asphaltshingles (which include fiberglass[52.4 percent] and organic [11.1percent]) continued to dominatethe market with a 63.5 percent ($3billion) share, a 4.5 percent ($250million) decrease from 1995. Com-mercial material use on residentialroof systems captured 22 percent($1.02 billion) of the reroofing mar-ket, an increase of 2.1 percent. Mean-while, metal, tile and slate eachincreased slightly from last year.

For the new construction market,¥phalt shingle usage decreasedslightly from last year to 57 percent($560 million). Fiberglass shinglesaccounted for 48 percent ($470

20 Professional Roofing April 1997

1996: $13.9 billion

bitumen at 23 percent (the same aslast year) and asphalt shingles at 6.8percent (a 0.1 percent drop).

The residential sector is predictedto represent 27.7 percent ($5.04 bil-lion) of the market. Contractorsindicated that new consb"uction willrepresent 19 percent {$980 million)of the residential sector and reroof-ing 81 percent ($4.06 billion).

In the residential new consb"uc-tion and reroofing markets, materialuse is projected to be similar to 1996.

Although the overall residentialmarket is not expected to changemuch during 1997, contractors in theMidwest and South predicted slightdecreases. Roofing professionals inthe West and Northeast, however,projected marginal increases.

1997 (p): $13.18 billion

Reroofing

Metal 2.5%

-Other includes tile. SPF and liquid-applied roof systems and asphalt shingles

BunNG DECISIONSRoofing conU"actors revealed in thesurvey that buying decisions for roofsystem types and specific manufac-turer's roof systems differ, dependingon whether the project involves re-roofing or new construction work.

For reroofing, conU"actors decidewhich type of system to use 61.5 per-cent of the time and which manufac-turer's system to employ 86.3 percentof the time.

In new construction, architects/specifiers are the decision makers81.4 percent of the time for the typeof system used. When it comes toselecting which manufacturer's sys-tem to use, conU"actors decide 55.2percent of the time, and architects/specifiers decide 41.9 percent of thetime. General conU"actors and build-ing owners make the decision therest of the time.

1996: $5.7 billion 1997 (p): $5.04 billion

SUMMING IT UPThere are many opinions about roof-ing industry economic conditions for1997-the outlook primarily dependson the region in which contractorsoperate their businesses. ~

New constructionWood shingles.shakes 3.5%Slate 5.1 %" "

Other" 3.5% "Metal 4.2%

Reroofing

Othef'* 3 % """-

Metal 3.2%

Slate 3%Tile 2.1%/

Sandy Burns if NRCA'sexecutive assis-tant, and Marl A. Paulson if editor ofProfessional Roofing magazine. Toobtain a complete copy of suroey findings,roofing professionals should unite toBurns at NRCA, 10255 'W: Hi88insRoad, Suite 600, Rosemont, IU. 60018-5607; telephone (847) 299-9070, fax(847) 299-1183.

Tile 7.6%

Low-slopematerials 22%Low-slope /

materials 19.1 %

"Other includes cement-based, composite/synthetic and copper shingles.

Apri11997 Professi~alRoofing 21