Economic Outlook

By Sean P. Boyle,
Vice President Marketing,
LATICRETE International

The article below provides a brief high-level summary of the construction outlook for both the residential and commercial markets, including an estimate of tile consumption for 2018.

Residential construction

Residential new and remodeling construction plays a significant role in tile consumption and is a key barometer to the overall economy. Over the past several years, the residential market has continued to climb out of the trough from the recession, and has shown growth throughout 2017. Home values increased again in 2017 while existing home inventory remained at normal levels. Overall, residential growth looks forward to continued expansion in 2018.

New Housing starts – 2017 total new housing starts increased overall only around 3% over 2016. Single-family starts were relatively healthy, increasing over 2016 by almost 9%, however multi-family construction dragged the overall category down – starts for multi-family were down close to 8% after some high growth years in 2014 and 2015 resulting in overbuilding for the segment. For 2018, new total housing starts are projected to only increase close to 3% again, with single-family up only around 5% and multi-family slightly down versus last year. Total units again will hover around 1.3M. The impact from the Tax Cuts and Jobs Act signed into law recently will most likely dampen housing activity in very high home value markets ($1M or greater homes). However, it will not impact the majority of U.S. home owners, since they are still able to deduct interest payments on mortgage debt up to $750,000 which includes new mortgages or improvements made from December 17 through 2026.

 

Residential Remodeling – Remodeling is the other and larger side of the residential market place and has performed nicely throughout 2017 and is forecasted to lead again in 2018. The housing industry continues to benefit from robust sales of existing homes and is running at historic lows of inventory. According to many construction indicators, there is widespread agreement that residential remodeling spending will increase in 2018 versus 2017, at a mid- to high-single digit rate.

Residential remodeling continues to benefit from factors impacting new housing starts. As with the last several years, Millennials are remaining at home longer, and older individuals are choosing to remain at home or “age in place.” This will spur home remodeling and will continue to result in solid growth again in 2018 with bathrooms, kitchens and in-law room additions driving remodeling activity. Rising home values and continued low interest rates are allowing homeowners to take out home-equity loans for the remodeling project. This is driving demand across all aspects of construction – especially for new tile or stone flooring!

Overall, we forecast the residential market to account for close to 60% of all tile consumption in the U.S. in 2018. It will drive growth for flooring, with kitchens and bathrooms as the main project types. The new tax law mentioned above will however bring down a percentage of remodeling spending on very expensive homes – as deductions on interest will be capped – but overall the segment will be strong in 2018.

 

Commercial Construction

We forecast the commercial construction segment to experience steady growth in 2018, between 3% and 5% in new square footage over 2017. The commercial segment is being aided by a continued easing of lending standards that allow for more of the much-needed financing for large projects, combined with an increase in demand for commercial lending. Whereas the Tax Cuts and Jobs Act may lessen housing activity in very high-end home markets, the impact of the law is favorable for commercial construction due to reduced corporate tax rates, thus providing an incentive for investment. In addition, favorable commercial lending policies and recent survey results among architects show an increase in demand for services, so the environment is very favorable for expansion.

Looking within the commercial segment, low single-digit growth is basically forecast across most verticals with education and office building activity leading the way. All regions across the U.S. – except the North East – are poised for growth, with starts in the South Central and Mid-West states forecast to have the largest percentage of growth when looking at value of total starts.

Tile consumption 

As previously mentioned, 2017 residential construction experienced another solid year of growth for new and remodeling activity, and commercial construction increased modestly in terms of square footage. Based on this, we believe tile and stone combined consumption will increase to ~ 3.5 billion square feet in 2017, an increase around 4%.

Based upon the above-forecasted growth in each market for 2018, we can segment the ceramic tile and stone industry accordingly, and calculate the respective share in square footage of each segment with applicable growth percentages based upon the 2018 outlook. A conservative estimate range for 2018 indicates combined tile and stone consumption growth of between 4% and 6% to approximately 3.7 billion square feet.

Tile and stone consumption estimates are naturally subject to all the macro-economic and subsequent construction market risks as well. The recent tax law – coupled with a charged political environment – plus a myriad of changes in key markets around the world can instantly impact forecasts.

As with last year, all of the major institutions that track and forecast construction activity are projecting growth for 2018 at various rates.  It is that consensus which makes us confident that we are looking forward to an exciting 2018, and continued growth of ceramic tile and stone!

Business Tip – March 2018

Tax reform: yes, it is a big deal

By Pat O’Connor, Kent and O’Connor, Washington, D.C.

Tax reform legislation raced through Congress at lightning speed. So quickly, in fact, analysts are still digesting its contents and assessing its impact. Critics say it favors the rich. Proponents promise it will unleash the American economy. Others worry about the long-term impact on the national debt. Yet, the truth is, nobody really knows for sure how this legislation will reshape the economy or our society at large.

From the perspective of corporate taxation, we can say for certain, passage of the Tax Cut and Jobs Act of 2017 is a big deal. For years, the United States has clung to an outdated 1986 era corporate tax code and a 1960s system of taxing “worldwide” income that most other countries abandoned long ago. At 35%, the U.S. corporate rate towered over other developed countries’ rates. In a global economy, where companies can choose where to produce and invest, these features pushed many companies and trillions of dollars overseas. Bold structural changes were needed. And, the new law does just that.

Already, as of mid-January, over 220 companies have responded, either by providing bonuses, wage increases, or both to employees. AT&T gave $1,000 bonuses to 200,000 hourly employees and announced they will boost capital spending in the U.S. by $1 billion in 2018. Starbucks employees received wage increases and expanded benefits. Some dismiss these gestures as little more than window dressing with no real impact. Yet, others see this as an early indicator of positive things to come as the consequences of tax reform work their way through the economy. (Ed. Note: Conversely, since the reform has been enacted, we’ve seen major retailers close hundreds of store locations, and lay off thousands of workers. Whether coincidental timing or deliberate scheduling, the effects on discretionary income are yet to be seen.)

The new 21% corporate tax rate and the switch to a territorial system of corporate taxation are key changes. But these are not the only ones. Other changes include:

100% Expensing: The bill provides a full and immediate write-off of most machinery and equipment purchased for use in a trade or business, including both new and used property.

Increased “Luxury” Auto Depreciation Limits: The bill increases limits on passenger vehicle depreciation – commonly referred to as the “luxury vehicle depreciation limit.” The limits are increased from $3,160 to $10,000 in the first year; from $5,100 to $16,000 in the second year; from $3,050 to $9,600 in the third year; and from $1,875 to $5,760 in the fourth and later years.

Limit on Interest Deduction: For companies with more than $25 million in gross receipts, the bill limits the deduction for corporate interest paid. The deduction cannot exceed the sum of i) business interest income plus ii) 30% of the adjusted taxable income of the corporation.

Entertainment Expenses: No deduction will be allowed for entertainment expenses, although the company can still deduct 50% of the cost of meals for employees on work travel.

Credit for Family and Medical Leave: In 2018 and 2019, employers can claim a tax credit of 12.5 to 25% for wages paid to employees while on paid family and medical leave.

A new deduction for pass-through entities

One of the most intriguing and complicated changes is the new tax benefit for “pass-through” entities, which includes S-corporations, partnerships, sole proprietors and most LLCs. The essence of the new Section 199A is a deduction of 20% of the entity’s Qualified Business Income (QBI). The potential tax savings is prompting many business owners to rethink their operation. Here’s how it works:

Let’s say Joe owns a tile installation business, called Tile LLC, where the income is taxed as a sole proprietor on Joe’s individual tax return. In 2018, Tile LLC has a profit of $250,000, which is reported on Joe’s Form 1040, Schedule C. Subject to certain income restrictions, Joe will receive a $50,000 deduction (20% of his Qualified Business Income) on his individual tax return!

However, the restrictions on the QBI deduction add a great deal of complexity:

First, there is an income threshold to consider. If Joe is married and files a joint tax return, he and his wife’s taxable income must be less than $315,000 to claim the full 20% QBI deduction (less than $157,500 for single taxpayers). For incomes over $315,000, a partial deduction is allowed for joint taxable incomes up to $415,000.

If the entity is a personal services business (accounting, legal, consulting, and any other trade or business where the reputation or skill of one or more of its employees is the reason for the revenue, except for engineering or architectural services), no QBI deduction is allowed for pass-through income if the individual taxpayer’s taxable income is greater than $415,000 for joint filers.

For entities that are NOT personal services corporations and the pass-through income exceeds the income threshold described above, a QBI deduction is available, but may be limited. In this circumstance, the QBI deduction is the lesser of 20% of QBI or 50% of the W-2 wages paid to all employees by the entity; or, alternatively, 25% of W-2 wages plus 2.5% of the original cost of tangible depreciable assets.

For Subchapter S corporations, the rules requiring employee/owners to be “reasonably compensated” still apply. So, if Tile LLC is a Subchapter-S corporation, Joe would pay himself a reasonable salary of, say, $70,000 and receive a W-2 for that amount, leaving a pass-through profit of $180,000. The 20% QBI deduction would be $36,000.

Generally, an estate or trust is also able to deduct up to 20% of business income from a pass-through entity.

Yes, it’s complicated. Tax planners are eager to see guidance from the IRS to provide more detail on how this provision will be implemented.

But with change comes opportunity. And the opportunities created by the Tax Cut and Jobs Act of 2017 are indeed significant. While no company should rush headlong into a major restructuring, every company should explore whether their current structure continues to make sense. Almost overnight, we find ourselves in a new environment. Navigating this changed landscape will take skill, and the guidance of a knowledgeable accountant, but it will be well worth the effort.

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Pat O’Connor is a principal in Kent & O’Connor, Incorporated, a Washington, D.C.-based government affairs firm. A veteran of Capitol Hill with particular expertise in health, transportation and the environment, O’Connor works with trade associations and companies to find workable solutions to the most pressing regulatory and legislative issues. For more information, visit www.kentoconnor.com or call 202-223-6222.

Ask the Experts – March 2018

QUESTION

I am a homeowner having a glass tile install performed. The tile is a 3” x 12” glass subway tile with a color backing. It is being installed as the backsplash around the stove/oven. My tile contractor said to butt the glass tiles up to each other with no spacing in between – and to butt them up to the quartz countertop – but I was told by the tile store to use a 1/8” spacing.

All I am looking for is your technical opinion on the proper way to install the tiles regarding the spacing to give some instruction to my contractor for the install. The tile edges/corners are flat with no bumpers that would cause a spacing when they are butted up to each other.

ANSWER

We always encourage our members to follow the guidelines set forth in the TCNA Handbook. On page 37 of the Handbook it states “that in no circumstances shall the grout joint be less than a 1/16 of an inch.”

One of the reasons listed for a minimum requirement for grout joint size on all tile installations is “thermal expansion.” Glass tile is highly expansive. It also explains that the grout joint should be no smaller than three times the variation of the tiles themselves. That means if a particular group of tiles vary in size 1/16”, the smallest grout joint recommended for that particular group of tiles is 3/16” of an inch.

Most glass tile manufacturers have directions for the use of their products. I would encourage you to contact the manufacturer of the glass to get their recommended grout joint size. And make sure there is the appropriate sealant joint where ever the tile meets differing materials like a countertop or cabinet.

I hope this helps.

Robb Roderick, NTCA Technical Trainer

QUESTION

I plan to have a small bathroom tiled, shower walls with niche, shower floor, and floor (12” x 24” walls and 4” hex all floors). This is on concrete slab.

I’m working with a contractor who is bringing tilers in for the job and I’d like to make sure they are following standards. Can you tell me what the acceptable methods are for building/waterproofing a mud-pan, including shower wall and threshold?

I know they are creating a mud pan, but not sure what products or method they are using. I’m assuming there are a variety of products used and methods, which makes it complicated for the lay person. Any information/diagrams are appreciated.

Thank you!

ANSWER

You are correct that shower construction is complicated. It is critical that a shower is constructed properly.

Depending on the specifics of your installation, there are several methods for constructing showers published in the 2017 edition of the TCNA Handbook for Ceramic, Glass and Stone Tile Installation. These will guide a contractor who owns and uses them.

These methods include: B414, B441, B415, B420, B426, B431, B421, B422, B421C, B422C. These methods may vary somewhat depending on whether ceramic/porcelain or stone tiles are being installed. In addition, the Handbook contains several details for common configurations for curbs and membrane installation.

You are also correct that there are a variety of products on the market that are excellent for constructing successful shower and tile installations. Many of these materials meet or exceed the ANSI A118, ANSI A137.1 and ANSI A137.2 standards. A knowledgeable installer and contractor will be able to identify the appropriate materials and relate them to the TCNA Handbook method that is most appropriate for your installation.

If your contractor is a member of the National Tile Contractors Association I would be happy to speak with them and assist them with any questions or concerns they may have in selecting the appropriate method for constructing your shower. If your contractor is not a member of the NTCA, I would be happy to speak with them about becoming a member, and all of the professional benefits membership provides. A search for an NTCA member contractor near you can be done at this link: http://tile-assn.site-ym.com/search/custom.asp?id=2759 or http://bit.ly/2FJiak6.

I highly recommend employing a Ceramic Tile Education Foundation (CTEF) Certified Tile Installer (CTI). CTIs are installers who have proven their knowledge of skills in applying industry recognized standards, methods and best practices to ensure you get the correct installation from the substructure to the finished tile surface. CTIs can be located at this link: https://www.ceramictilefoundation.org/find-certified-tile-installers or http://bit.ly/2CSu5Jf.

I hope this helps!
Mark Heinlein – CTI #1112, Training Director,
Technical Trainer / Presenter

President’s Letter – March 2018

Best Practices – Contract Negotiations

We’ve invested time and money in estimating a project, reviewing all the specifications, drawings and contract documents, communicated with our suppliers and vendors, priced out all the materials and labor, calculated the risks of the job and submitted our bid. Great news!! We have been awarded the project. It is critical that we not relax and assume the hard part is over. If we do, we put our entire investment at greater risk.
One of the biggest mistakes any of us can make is not negotiating a fair contract for our services. Unfortunately, this happens more frequently than you might think. One of the first things we all need to understand and accept as fact is that almost all general contractors write contracts that are slanted in their favor. In many cases, they are seriously slanted against the trade contractor and put us at a disadvantage before we ever start.
It sounds elementary and it shouldn’t have to be said, but rule number one is, we should never sign a contract we haven’t read and understood. We should never think that because we have a relationship with the customer that they will take care of us and not enforce the contract.
Another common belief is that trade contractors are never successful negotiating any of the conditions in their contracts. Well, that’s exactly what the general contractors want you to believe. When we read the contracts, the first thing we must determine is, “Am I willing to take the risks assigned to me and sign this contract? If not, then I must identify the objectionable clauses and either strike them or draft acceptable language I can agree to.” At the end of the day, if we aren’t able to negotiate acceptable language, we must make the business decision to either sign what we have or graciously walk away.
Some of the key clauses that need our attention are:

Payment terms, including any clauses about “pay when paid” or “pay if paid” as a conditional precedent. Some states have laws regulating this language. This means that the contractor only has to pay you “if” he gets paid or at some time “after” he is paid.

Set off provisions, which allow contractors to hold money on additional projects under contract with them other than the project in question.

No damage for delays, which puts all the risk of the construction schedule on the trade contractors and does not allow any reimbursement of costs for delays even if we are not at fault.

Work force supplementation, which allows the contractor to charge you if they supplement your crews, with or without notice or default.

Back charge clauses, which allow the contractor to backcharge the trade contractor without notice or with limited notice for an unlimited list of things.

Since I’m not an attorney and can’t give legal advice, the most important thing I can say is that you should consult with an attorney prior to signing contracts. Once you understand some of these clauses you can begin to negotiate with greater success. It’s always a good idea to work toward having your proposal with all your inclusions, exclusions and clarifying notes included as part of the contract.
Companies that regularly practice these principles are usually Best in Class contractors. That’s something we all aspire to achieve.
Keep on tiling!

Martin Howard, President NTCA
Committee member, ANSI A108
[email protected]

Editor’s Letter – March 2018

As I am writing this, National Tile Day, February 23, is just three days away. Our social media and online digital sites have been awash in Why Tile? news and hashtags, and posts that serve to boost tile’s popularity with consumers, illustrating the properties, artistry and performance characteristics of the floor and wall covering that we in the industry have dedicated our lives to promoting, selling, installing and using in design. Tile manufacturers’ associations – foreign and domestic – as well as contractors, designers, Coverings, and others are all getting into the act. Did you catch any of it? How did you get onboard with raising awareness of tile as a great finishing material in 2018?

Did you miss it? Well, mark it on your calendar for next February 23, 2019 and plan a promotion or awareness campaign in your segment of the market. Wondering what to do? Enter #whytile or #nationaltileday in your favorite social media and see some of the efforts that took place in 2017 and 2018, then plan accordingly and join the festivities.

Taking a look at our story lineup this month, please be sure to catch the Business Tip, written by Pat O’Connor. He takes a look at how the new Tax Cut and Jobs Act may affect your business. LATICRETE’s Sean Boyle also gives us a view into economic trends and growth that will impact our industry in 2018 and beyond.

Also take a look at the Coverings preview. It includes information about an exciting new activity NTCA is spearheading at the show – the Installation Experience. At press time, it’s still in the planning stages, but read and learn about what we’ve got up our sleeve for your enjoyment and education, and plan to attend Coverings May 8-11 at the Georgia World Congress Center in Atlanta this year.

God bless,
Lesley
[email protected]

Technical Feature – Trostrud Mosaic & Tile Co., Inc. spearheads John Hancock health club renovation

By Lesley Goddin

Chicago’s iconic John Hancock building was put into service early in 1970, but 46 years later, one of the world’s highest indoor swimming pools drastically needed an update. Archimage Architects, Ltd. was awarded the project of a full remodel on the existing health club, including the pool and locker rooms. The space was gutted down to original concrete substrates, but until the demolition was complete, no one knew for sure what they’d find.

Clune Construction, the general contractor, awarded the tile contract to Trostrud Mosaic & Tile Co., Inc., early in the bidding process, due to the 10-week lead time needed for procuring the Italian porcelain tiles. This proved to be a fortuitous decision due to the on-the-job meetings with architects Kirk and Sheryl Stevens.

Trostrud was intent on setting a level-of expectation regarding the flow or puddling of water, at the barrier-free showers and the pool deck, insisting on a minimum 1/4” per foot pitch to drain to avoid pooling of water in the deck and locker rooms. The condo association balked, expecting the pool deck to drain just like a large shower floor. This conflict presented significant challenges, including a drainage drawing that was modified three times before getting agreement from all parties.

The existing pool was to receive a new stainless steel coping that would be set as high as possible to allow for the required pitch. At the perimeter of the pool deck Trostrud was required to meet existing aluminum flashing which could not be changed. The final drainage drawing consisted of several linear drains and many spot drains.

When the demo was complete and the tile mud beds were removed, it was clear that the existing concrete subfloor at the locker room required significant help. Leaking showers had caused rebar to rust and expand, fracturing areas in the sub floor. With the help of a structural engineer, the slab was rebuilt. All the adjustments resulted in a four-week delay in an already-aggressive schedule.

Once the floors in the locker rooms were resolved, the first phase went off without a hitch. The pool deck was another story. The pool contractor set his stainless steel coping 1/2” lower than agreed. Trostrud discovered the error when setting spot drains, in the beginning of the pool mud-bed installation. This greatly complicated the installation, and correcting the coping was not an option.

“We preceded the best we could,” said Brad Trostrud, vice president of Trostrud Mosaic & Tile Co., Inc. “Mike Miller, our foreman, worked his magic to make the deck drain effectively.”

The new schedule also required Trostrud to mud set over a freshly poured, uncured concrete slab. Even though Trostrud was using a floating mud bed, they worked with Tyler Barton from MAPEI and the concrete contractor to devise a better solution. It was determined that Barrier One Porosity Inhibiting Admixture, added to the mix, would allow Trostrud to cover the slab in 10 days.

The Italian porcelain tile was Caesar Uniqua in Tiburtina, Argentum and Imperium, and well as a solid black tile by Caesar. Glass mosaic was from Island Stone. Products were sourced through Virginia Tile in Wood Dale, Ill., and set using MAPEI products, including Ultracolor Plus, Keracolor U, Ultraflex LFT, AquaDefense, Adesilex P-10 and Mapecem Quickpatch.

When the job was completed, the condo board and Archimage Architects were extremely satisfied with the results.

Stone – Proper selection, preparation, installation and maintenance spell success in stone projects

By Lesley Goddin

For this month’s Stone section, we went to Roy Viana, Dal-Tile Director of Natural Stone and Slab and Carlos Chiu, Dal-Tile Product Manager of Stone Tile and Sourced Mosaics to get an overview of issues pertinent to stone selection, maintenance, and installation for the professional tile contractor.

The first step in a stone installation is to select the stone, not just for aesthetics, but also to be sure the characteristics of the stone match the intended application.

Both Viana and Chiu agreed that natural stones – granite, marble, soapstone, limestone, travertine, etc. – all have specific technical characteristics that make them unique, and make them perform differently in a given setting depending on use and customer lifestyle.

Match stone to application

Chiu recommended knowing the place and type of environment in which the installation will take place – and suggested answering these questions in order to ensure the natural stone is a match for the application:

  • Is it an interior or exterior application?
  • Will it be subject to freezing and thawing conditions?
  • Is slip resistance a concern?
  • Will the stone be in contact with water or humidity?
  • Will it be a floor or wall application?
  • Is it a high or low traffic area?
  • “Once you know the answers to these questions you will be able to narrow down the stones that are suitable for your application,” he said.

Viana added, “Take into account the color, pattern and texture of the stone, paying special attention to the larger overall appearance. Stone finishes, such as polished, honed, antiqued or leathered (to name a few), will play a significant role in the finished kitchen countertop selection.”

Don’t skip the sealer

When working with stone, be mindful of the need for a sealer, Chiu explained. “Most of the time, stone needs to be sealed before applying the grout and after applying the grout. Some other stones need the sealer to be applied on the six sides of the tile to prevent the stone from absorbing humidity and changing color.”

A sealer is important, Viana echoed, as an effective precautionary measure against damage caused by everyday use. “The sealer creates a protective layer over the surface of the stone, preventing liquid from being absorbed and causing discoloration,” he said. “Proper application of a sealer is extremely important.” It’s also important that the proper TYPE of sealer be applied, so become familiar with sealer options and consult with the stone supplier or sealer manufacturer to be sure the product will enhance – and not harm – the stone.

Porous and soft stone need special considerations

During the actual installation process, consider the stone characteristics before selecting setting materials. “For example, there are some stones that react to water and installing them with a regular thinset will cause the stone to curl,” Chiu said. “To prevent this, an epoxy needs to be used. In addition, some stones have reinforced backings, such as resin or mesh backings. Therefore, any stone with these types of backings needs to be installed with epoxy. Exterior applications sometimes require special setting materials.

“In terms of grouts, some stones – specifically soft stones with polished finishes – can get scratched easily if sanded grout is used,” Chiu added. “Therefore, unsanded grout needs to be utilized. However, there are limitations regarding what type of grout can be used based on the grout width. If your grout width is wider than 1/8”, sanded grout needs to be utilized. If the grout width is less than 1/8”, unsanded grout will need to be used. If your grout width is too wide to use unsanded grout, then use sanded grout but apply it carefully to prevent scratching.”

Keeping stone beautiful

Once installed, counsel your client on maintenance to ensure long life and beauty of the stone. “Keeping the surface clean is the golden rule of natural stone,” Viana said. “As a porous stone, it can be susceptible to stains and discolorations from various liquids, especially the acidic ones. Citrus juice, vinegar and common household cleaning products can cause damage to certain natural stone countertops, such as marbles.” Spills should be wiped up immediately.

Cleaning the stone should be done with specially formulated cleaning products designed for natural stone, Viana said. Also he suggested keeping stone away from toiletry products which may contain chemicals that damage stone. Keeping products on a mat or in a decorative basket can protect stone, as does using coasters on bathroom countertops.

“Being proactive about keeping your natural stone clean will significantly increase its longevity while maintaining its beauty,” Viana said.

Direct heat can also discolor stone, so stone countertops should be protected from hot pots, plates and pans by using trivets and mats as barriers between the hot items and the stone. “Bathroom counters are especially vulnerable to forgotten hair curlers or straighteners, which can burn, and even crack, some stone due to ‘thermal shock’,” Viana said.

With proper care, protection and preparation, stone can be suitable for almost every area. However, Chiu said that stone isn’t a suitable choice when it would be “submerged in water and the water contains some type of chemicals, such as chlorine. Pool or fountain chemicals will discolor the stone. Stone is suitable for all other types of applications. It is just a matter of finding the right stone, installing it correctly and maintaining it well.”

50th Five Star Contractor Member – Trostrud Mosaic & Tile Co.

Trostrud Mosaic & Tile Co., Inc., was founded in 1929 by Earl J. Trostrud Sr., originally concentrating primarily on residential construction as it worked hard to create a solid reputation.

At the end of 1939, with the outbreak of war in Europe, the company temporarily closed, and Earl Trostrud Sr. went to work making aircraft engine parts, and in the construction department of Kraft Foods. In postwar 1946, Earl Trostrud Sr. reopened Trostrud Mosaic & Tile Co., Inc., still focusing on the residential market and building its reputation for quality and craftsmanship.

In 1957, Earl Trostrud Sr. started pursuing commercial contracts and was awarded several gas station projects. These successful projects whetted the appetite for more commercial work.

In the spring of 1958, after graduating St. Olaf College in Minnesota, Earl Trostrud Jr. joined his father in the tile business and they both pursued commercial contracts, with the same ethics of quality workmanship, integrity and honesty that the company was founded on. They committed to treating everyone – no matter your role in the company or as a business partner – the way they would want to be treated.

In the summer of 1975, Earl Trostrud Sr. retired from the tile business. Ten years later – after graduating from University of Wisconsin Stout with a major in industrial design/product design and a minor in graphic design, and working in these fields – his grandson Brad Trostrud decided to give estimating a six-month try, working alongside his father Earl Trostrud, Jr.

Brad relished the opportunity to work with his father and to strengthen the bond. By now the company, based in Wood Dale, Ill., had grown to be 15% high-end residential and 85% commercial. It turned out to be a rewarding decision for both of them. Earl, now in his early ’80s, is still working every day, and holds the title of president. Brad is the vice president.

Earl and Brad have always been very active in the Ceramic Tile Contractors Association of Chicago (CTCAC) and Tile Contractors Association of America (TCAA), both serving in every position. Earl helped found the Chicago Tile Institute promotion fund to uphold the value of union-installed tile and stone. Earl is also the chairman for the Pension and Welfare fund since 1990, and served as a Zone Director for the TCAA in the ‘70s. In 2013, Earl was awarded the Carl V. Cesery Award that recognizes distinguished service to the tile industry.

Brad serves on The National Tile Contractors Association (NTCA) Technical committee and Tile Council of North America (TCNA) Handbook committee. Brad was also involved in the creation of Advanced Certifications for Tile Installers (ACT), a certification program to provide a level of consumer confidence for installation procedures that exceed ANSI Standards and TCNA guidelines. Brad has also served as director, treasurer and now is president elect for TCAA.

Joining NTCA

Brad came to NTCA through a Trowel of Excellence/Five Star Contractor meeting at the Crossville plant a few years ago, where he met Artcraft’s James Woelfel and David Allen Company’s Chris Walker.

“James and Chris are two of the sharpest minds in the tile industry I have ever known,” he said. “By the time I left Tennessee, I felt like we were all old friends. “

Brad also met Welch Tile & Marble’s Dan Welch, David Allen Company’s Martin Howard, Cox Tile’s John Cox and CTEF’s Scott Carothers in 2013, at the first Total Solutions Plus to include TCAA in Scottsdale, Ariz. “What a group of wonderful gentlemen, not afraid to share the great knowledge they have acquired during the years in our industry,” he said. “Getting to know them over the years has been a great blessing. So after a time, I felt compelled to join their NTCA.”

Since union setters and finishers go through an extensive apprenticeship program, CTI certification wasn’t a requirement for Trostrud’s Five Star Contractor status – NTCA’s 50th Five Star – but the company has five ACT-certified setters nonetheless, one of whom was tapped by the union to be the Chicago-Midwest head instructor for the BAC IMI.

Trostrud Mosaic & Tile Co., Inc., has been honored with various awards over the years, most notably the International Union of Bricklayers and Allied Craftworkers Craft Award for Best Mosaic in 2015 and best Tile Project in 2008. It also received TCAA’s 1st Place Commercial Project award and achieved Trowel of Excellence certification in 2012. It contends that it employs the best union trade installers in the business. The company – which has grown to 90% commercial – holds as its top priority providing the best tile installations
possible.

“We are not interested in being the largest or the least expensive tile contractor – we will not compromise on quality – we just want to be known as the best,” Brad Trostrud said.

Newest NTCA member benefit: Zlien

One of NTCA’s newest member benefits is Zlien, a company that assists over 24,000 contractors nationwide in protecting lien rights and reducing financial risk.

Zlien’s mission is to empower successful construction projects by getting the lien rights “mess” out of the way. Zlien’s website (zlien.com) explains that “Mechanics lien and bond claim rights are connected to every payment in construction – a $960 billion a year industry. By helping material suppliers, lenders, and everybody in between easily manage these rights, we strive to facilitate successful projects, smooth payments, and happy people.
“Our mission is to enable all project stakeholders to protect their finances and succeed in their jobs, all without a drop of stress.”

Building a fair payment process for the construction industry, Zlien’s cloud-based platform makes lien rights easy. Construction firms, contractors, suppliers, and other project stakeholders nationwide use Zlien to eliminate the administrative headaches and legal guesswork associated with lien waiver exchanges, preliminary notices, and mechanics lien compliance.

Zlien employs what it calls “The Lien Genome™” that the site explains like this:

“Four out of 5 construction businesses believe that managing lien security and lien waivers is hard. It’s no wonder, since lien laws around the United States demand more than 100,000 combinations of deadlines, documents, dates, and other requirements. We’ve mapped this landscape of lien laws, calling it the Lien Genome™. With a few basic pieces of project information, the Lien Genome™ will instantly explain how to protect lien rights and exchange proper lien waivers. Our goal isn’t to help you understand lien laws. With zlien, you’ll never think about lien laws again.”

Visit the Member Benefits section of the NTCA website at www.tile-assn.com to find out more about how Zlien can help you. Interested in becoming a member to make the most of this and other member benefits? Contact Jim Olson at [email protected] tile-assn.com.

HOT TOPICS – Dealing with substandard tile, part 1

By Lesley Goddin

On Dec 29, 2017, on the NTCA Members Only Facebook page, a discussion developed from comments from NTCA Member Damian Arine of Sun Country Customs in Arroyo Grande, Calif., about the challenges of contractors dealing with substandard tile.

Arine, frustrated with a proliferation of flawed product, asked why companies are “allowed to stamp a regulatory committee stamp on their stuff when it is obviously not up to any standards? It’s an ongoing thing. If you call and bring it to their attention, you might get an apology and some money taken off your order. But it still doesn’t change their methods.”

Arine continued, “I used to just deal with the problems. Now I bring it up to everyone who will pay attention. The distributor. The rep…even the company itself. Maybe one day it will make a dent but until then I’m blessed with being given different but ‘the same material,’ or tee shirts.”

The situation is compounded by the real-world situation the contractor is up against, Arine said. “It’s a horrible situation. You bitch at the distributor too much; well, they’re going to stop referring you. The homeowner wants it done and you want to save face.”

This discussion spurred the desire to investigate how contractors around the country are dealing with similar challenges, in two parts – looking at the problem; then looking at the solutions.

We do not have the space here to detail ALL of the horror stories about substandard, out-of-caliber, incorrectly fired, etc. tile, but suffice to say that every contractor we contacted had experienced this at one time or another.

For instance, Arine sent this photo of this unevenly-mounted tile. He said, “Best solution is to take them all off the sheets and install individually. Now this was a small shower floor so it didn’t add a ton of time. But it was still time. If I wanted compensation who do I go after? The homeowner didn’t know what they were buying. The distributor just sells it.”

Jeremy Waldorf of Legacy Floors in Howell, Mich., described a nightmare 550-sq.-ft. job in which the 12” x 24” porcelain tile sourced from a local distributor started breaking “in strange patterns” and resulted in pieces “literally falling out of the middle of the tile.” No matter what Waldorf tried, this continued. When he contacted the supplier, the rep told him that it was a firing issue that made the tile brittle and the installed tile would be durable, but each tile would have to be waterjet cut. “That just wasn’t going to happen,” Waldorf said. Though the supplier took the tile back and refunded the client’s money, it still meant this one-man business had to load up 550 sq. ft. of tile back on the truck, have the client re-select a new tile and then deliver the new truckload of tile three days later. His solution was to never use that brand of tile again.

Dealing with the problem

So, what to do? In broad strokes, these are the suggestions by small contractors and NTCA experts who have wrestled with this problem:

  • Understand the standards and know the TCNA Handbook methods
  • Don’t buy the tile
  • Order extra and do mockups
  • Stay ahead of the job
  • Do not install substandard tile
  • Be wary of homeowner-purchased product from big box stores
  • Keep clients informed of the twists and turns and progress of the job – both good and bad
  • Work with reputable distributors
  • Request all technical information before starting a project when working with unfamiliar suppliers or owner-supplied material; clarify that numbers for the project are based on it meeting standard
  • Educate the client to have reasonable expectations of what to expect from the job

Stay tuned to the April 2018 issue of TileLetter, when we’ll look at these suggestions in a little more detail. Want to add to the discussion? Feel free to email
[email protected] with your suggestions, experiences or observations on this topic.

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