2010 Plumbing Supply Forum Tuesday 1st June 2010 Powerhouse Museum – Darling Harbour, Sydney

1. 2010 Plumbing Supply ForumTuesday 1st June 2010 Powerhouse Museum – Darling Harbour, Sydney David R. Hagopian Director of Strategy and Technology Plumbing Manufacturers Institute

2. Greetings Greetings from • Barbara Higgens, Executive Director, • Lee Mercer of Moen - PMI President, • Jack Krecek of Elkay - First Vice President, • The PMI Board of Directors

3. On Our Board of Directors Moen TOTO USA Elkay Neoperl Kohler Haws Corp. Price Pfister Symmons Industries T & S Brass Sloan Valve Co. WCM Industries

4. A Word About The U.S. Economy • Unemployment rate increased to 9.9 from 9.8%. • Total job loss since the recession began in December 2007 top 7.2 million with 2.2 million in the manufacturing sector. • 2010 jobless claims equal to 460,000, far above the level of 355,000 that has been consistent with private sector job growth. • Labor market remains fragile.

5. A Word About The U.S. Economy • New orders for manufactured goods rose 1.3% in March. • Consumer Confidence Index is up to 57.9%. • Single-family home construction rising 1.6% in March from February and 17.2% from a year earlier. • The Homebuyers Tax Credit is helping to spur home sales.

6. The Economy • For the sixth month in a row, more firms reported an increase in employment rather than a decline. • 59% of companies plan to increase production over the next six months. • Only 30% of those companies expect to hire additional workers. • The remaining firms reported they would rely on increased work hours to accommodate production increases.

7. The Economy • Housing market has seen a steady upturn but multi-family housing starts are down 18%. • National Association of Home Builders’ forecast calls for production to return to a healthy trend in 2012. • 2012 demand is expected to be 1.9 -2.0 million housing units which breaks out as follows: • 1.5 million single family, • 350-400 thousand multifamily units • 100-150 thousand manufactured homes. (source: Heuther/NAM and NAHB “Eye on the Economy”)

8. Economy and PMI • Members companies have seen layoffs, short work weeks and pay cuts. • No dues increase since 1998. • PMI membership is relatively stable– though we lost 2 members in 2010.

9. Economy and PMI • The 10th annual PMI codes and standards workshop is coming up in July. • The 2010 Spring Meeting in San Diego, California was among the top 4 best-attended Spring Meetings since 1998.

10. On The Radar Screen • Lead in Plumbing Products • California, Vermont, Maryland, National • Water Efficiency • WaterSense Rebates • Graywater • Definition

11. California Lead Law AB 1953 is currently in effect. PMI is key to the enforcement mechanism of Department of Toxic Substance Control sampling and Third Party Certification to NSF 372.

12. National Lead Law It is essential that the “playing field” be fair and level for all manufacturers!

13. Federal “Get The Lead Out Bill” PMI supports National U.S. Legislation to harmonize requirements for: Lead in Plumbing Products.

14. Federal “Get The Lead Out Bill” • Harmonizes 0.25% max. lead requirement across all 50 states (California, Vermont and Maryland already comply).

15. On The Radar Screen Home Star Program PMI is promoting legislation which offers rebates for the purchase of high efficiency products (WaterSense).

16. On The Radar Screen PMI Is Working to Promote Water Efficiency • Consumer Behavior • Whole House Savings • Codes and Standards • Alliances • Legislation

17. U.S. Department of Energy • Attempting to redefine valves as showerheads. • Department is examining testing protocols. • Looking to mandate WaterSense products.

18. On The Radar Screen Alliances and Partnerships • Alliance to Save Energy (ASE) -- linking water efficiency to energy efficiency • Alliance for Water Efficiency (AWE) • American Rivers • ASHRAE: High Efficiency Buildings Coalition • GreenPlumbers • U.S. EPA WaterSense Partner

19. Industry Research Projects Plumbing Efficiency Research Committee = “PERC” AWE, IAPMO, ICC, PHCC and PMI Drainline transport project is in-the-works. Next up: Thermal Shock and Low Flow Products

20. Continued Outreach Through Important International Liaisons • BMA – Bathroom Manufacturers Association (UK) • CEIR – European Valve Association • CIPH -- Canadian Institute of Plumbing & Heating • PPI Group – Plumbing Products Industry Group (Australia) • WPC -- World Plumbing Council

21. Proactive Planning Strategic Advisory Council Meeting: PMI Board of Directors, Past Presidents, Industry Thought Leaders and Guests May 4-5, 2010 Primary objective: To continuously add value to PMI member companies through relevant and innovative programs.

22. PMI’S Strategic Objectives Promote Inform Educate Enhance Advocate

23. Enhancing Our Public Relations, Outreach and Communication • Re-branding of PMI; New logo -- Plumbing ManufacturersInternational • Enhanced PMI Members’ Only Section • Social Media Sites • Podcasts, Webinars, Online Training • Reports and Data

24. PMI Websites and Social Media Enhanced: www.pmihome.org New: www.safeplumbing.com and PMI Linked-In Community

25. Conventional Communications Through PMIPublications PMI TECH TALK Quarterly Shipment Reports Monday Morning Economic Forecast Weekly Legislative Reports

26. Upcoming PMI Meetings PMI 2010 Fall Meeting The Liaison Hotel Washington, DC October 3-6, 2010

27. Upcoming PMI Meetings PMI 2011 Spring Meeting Hotel Monteleone New Orleans, LA March 27-30, 2011

28. Environmentalists Scientists Architects Globalization Consultants Economists Government Officials PMI Meeting Speakers

29. Tell us about US: Politics, Healthcare, The TEA Party, The news media. Jeff Patchell’s Questions

30. “A wise man once said, never discuss philosophy or politics in a disco environment.” “Government is the Entertainment division of the military-industrial complex.” “Communism doesn't work because people like to own stuff.” Appropriate Quotes Frank Zappa Irreverent Musician 1960’s – 1980’s

31. With two wars, an economic crash, federal spending at an all time high, the US electorate chose President Obama and Vice President Biden to lead the Executive Branch of our Federal Government. Regardless of politics, Americans are a patriotic lot! US Political Situation

32. US Political Situation

33. US Political Situation

34. Votes By County District

35. Health Care

36. Health Care

37. What is the TEA Party? • Taxed • Enough • Already Captures anti incumbency sentiment

38. Cable News Coverage • Nielsen Cable Network Coverage Estimates (as of December, 2009) • CNN/HLN: 100.22 million Households • CNBC: 97.59 million Households • FNC: 98.04 million Households • MSNBC: 93.0 million Households

39. Consumer Choice in Cable News FNC has more viewers than CNN/HLN, CNBC, and MSNBC combined WHY?

40. Consumer Choice in Cable News

41. Cable News Coverage • An Australian that really knew his market: • Came to the US • Studied the end consumer • Offered a product that fulfils needs • met • unmet • unrealized

42. Business Success in the US is a function of knowing and meeting needs (better than your competition). Thank you!

43. 1921 Rohlwing Road Unit G Rolling Meadows, Illinois 60008 USA 847/481-5500 847/481-5501 Fax www.pmihome.org