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Absolutely Explosive Heilcal Pile Industry Growth in the Last 8-10 Years - Why No Consolidation Activity Yet?
by Bill Bonekemper
HPW Publisher
August, 2023
Since this author began working in the helical pile industry in 2001, the industry has undergone an absolutely explosive amount of growth in the overall annual revenue the industry now generates, also in the number of new helical pile manufacturers in North America along with an enormous increase in the number of contractors that install helical piles and anchors.
Helical Pile Manufacturers
- HPW’s research reveals there are now at least (25) helical pile manufacturers located in the U.S., which is an increase of (8) manufacturers since HPW last published this statistic in 2015
- Also impressive is the number of Canadian-based manufacturers now totaling at least (16) or twice as many as reported in 2015
- The combined total of (41) manufacturers is four times the number of companies that were manufacturing and selling helical piles in 2001 - a 400% increase in (22) years!
Helical Pile Installation Contractors
Another equally impressive growth rate resides with the number of contractors that now install helical piles. In the “old days” circa 2000 - 2010, helical pile installers were a fairly specialized group of companies. The large deep foundation contractors for the most part were not interested in installing helical piles and anchors because they didn’t know much about them, and there was a general feeling that “those things” were only used for low capacity projects like boardwalks, decks, some underpinning, etc.
But along with the extraordinary growth of manufacturers, the number of contractors now installing helical piles and anchors is more than impressive. As an example, HPW currently has (254) helical pile installers listed on its U.S. States and Canadian Provinces pages. The number for North America is obviously much, much higher as is evidenced in part by an analysis HPW published in 2021. In that survey and the resulting article (read article here) the (8) manufacturers reviewed in the article provided the number of installers they claimed to have installing their products, and the total was approximately (1000) dealers/installers. In attempting to extrapolate what the current number might be in all of North America based upon (41) manufacturers, it’s rather simple to believe the current number of installers is easily three to five times more.
Self-Performing Manufacturers (Manufacture & Install Piles)
It should be noted that several manufacturers of helical piles and anchors also install them - some exclusively, while others both sell to other installers and/or install themselves. This business strategy is more prevalent in Canada than in the U.S. One of the most striking examples of this strategy is the Travers Solar Project in Alberta Canada, where Roterra Piling manufactured (228,564) helical piles and installed over (115,207) of them (read about it here).
Industry Consolidation
Industry consolidation is a phenomenon that has been happening on the planet since the very first competitors realized that it made more financial sense to join forces with a competitor rather than compete for the same customer dollar thus causing smaller and smaller profit margins. Some entrepreneurs resist mergers and acquisitions simply due to their or their family members’ ideals and dreams - thinking that what they have built from scratch will last “forever.” Other entrepreneurs take the complete opposite stance by building a successful company with the underlying intent to sell it someday for a substantial sum.
Why should the helical pile industry be any different? It’s not. It’s inevitable that sooner or later the consolidation process will surface in our industry – the only question is when.
What are some of the forces or conditions that will spur consolidation activities?
- Too many manufacturers competing for the same sales dollar
- Valuable product patents with substantial years remaining before expiration
- Long-term contracts with high-volume customers
- Substantial annual sales that would become more profitable through operation consolidation
- And of course, there is the time-tested axiom – you either grow or die
Conclusion
First and foremost, this author continues to be amazed by the growth of our industry. It has been very exciting and gratifying to be part of this major business success story. If in 2008, the year HPW was started, someone would have predicted where the industry would be in 2023, it would have been a difficult prediction to comprehend.
Nonetheless, consolidation is inevitable. It isn’t whether or not it will happen – but rather when it begins. There are enough large manufacturers, distributors, franchisee networks and installation contractor conglomerates with very attractive bottom lines to attract the eyes and minds of those with merger and acquisition interests.
