BC Wood News on-line

Either by phone or e-mail, we've been hearing this from members lately. It's not surprising - that's a huge increase by any measurement. Although we tried to explain the change in dues structure through the newsletter, mail-outs etc., we are all so busy attending to the urgent that it's easy to miss communication of any kind. So, what follows is a frank discussion on the rationale behind the increase in dues.

BC Wood has been around a nearly 17 years and, over that time, our mission and our funding have remained relatively consistent. We use industry contribution (i.e., your fees) to match with provincial and federal funding. Then, taking advantage of economies of scale, we assist BC Wood members to develop export markets. What has changed drastically over the years is the amount of industry contribution required to access government funding.

For those of you that recall the early years of BC Wood, you will remember that dues were based roughly on the size of the company. They ranged anywhere from $2,500 to $10,000. In the late '90's a reduced fee was introduced for smaller companies. In 2000, all that changed as the provincial government of the day, through FRBC, requested (demanded actually) that BC Wood open up its membership to every company by lowering the dues to $50! That lasted for a couple of years, until the change in government in 2001. After a lengthy review, the new government concluded that BC Wood was a valuable organization but additional contribution from industry was required. As a result, we raised our dues to $500.

In 2002 the Provincial Government created a new organization called Forest Innovation Investment, and the Federal Government announced the Canada Wood Export Program. Both programs were designed to assist wood product manufacturers to develop export markets and have contributed generously to market expansion for our industry (over $2 million per year). However, both programs contribute very little to the administration costs of delivering the programs. To cover these costs, BC Wood increased the costs to members of participating in marketing activities.

The key point is that there is a tradeoff between the cost BC Wood charges for its activities and the amount we charge for dues. In the past, we have increased the cost for activities and kept the cost of dues low. The problem with this model is that our funding partners perceive low dues as a lack of industry commitment. To rectify this perception, BC Wood's board voted to increase the dues while decreasing the cost of activities. The net result, for those who participate in at least one activity, is zero increase in overall costs.

We recognized that the increase in fees was not going to be easy. So, we restructured the organization to provide additional value to members. First, we divided the membership into product sectors (millwork, cabinets, remanufacturing etc.) and put a BC Wood staff member in charge of each sector. Secondly, we created industry advisory committees for each sector. Thirdly, using the help of these committees, we developed sector-specific market development activities that then became the basis of this year's funding proposals. The new structure offers a superb value: members can leverage their marketing budget many times over, and each sector decides which marketing activities to pursue. I am pleased to report that the restructuring worked very well: industry participation and input was excellent and BC Wood received funding for virtually every activity we requested.

I recognize that you, as a manufacturer, have to weigh the costs and benefits of membership in BC Wood to your firm. There are many benefits of belonging to BC Wood, and I won't list them here. But the key benefit now, as it has always been, is increased export sales. If you are in doubt, then I urge you to give the new model a try and renew your membership. Then, participate in at least one BC Wood activity this year. At the end of the year, let's sit down and review the benefits you received and the costs you expended. No other province in Canada has an association like BC Wood but we need your commitment to continue the vital work of developing and expanding your export sales.

Please contact me at 604-882-7100 or bdowning@bcwood.com if you have any questions.

Successful Industrial Lumber Mission Returns from China
Brian Hawrysh

I recently returned from a mission with five BC Wood member companies participating in the Industrial Lumber Mission to China. Without question, we all gained a better understanding and a renewed interest in the opportunities for lumber exports to the Chinese furniture, interior finishing and giftware sector. Our group consisted of representatives from Carlwood, Central Cedar, Bakerview, Powerwood and G.W. Tree and all reported on having a very informative and successful trip.

"It (China) is an interesting and amazing place which I would encourage everyone to visit. I think there are some real opportunities for our company and follow-up will be critical." Jim Fenton - Central Cedar Ltd.

Our five day itinerary included visits to eight different manufacturing plants in the strong softwood market of Shanghai and the South China city of Dongguan, where a traditional hardwood market remains dominant. We also participated in very successful business networking sessions, bringing together our Canadian companies and the key lumber distributors in each region. The Chinese companies we met gained a better appreciation for the species, grade, sizes and appropriate end-uses of industrial lumber readily available in BC, and for the manufacturing capabilities of BC Wood members.

For me, the main highlight of the trip, was the realization that there are real opportunities for BC's suppliers of industrial lumbers in China. While the market is certainly a competitive one; it is not all about price. There are so many potential customers in this large and rapidly expanding market, more than we can comprehend, and each has slightly different needs. The vast majority of end-users in China have no concept of what BC has to offer. The key is to gain a better understanding of who they are and what they require.

Jeff Li, BC Wood's representative in Shanghai, did an excellent job setting up our plant visits and meetings in China. He is currently following up with the companies we met in an effort to generate and qualify further inquiries for industrial lumber. Members wanting a list of companies visited during the mission and their specific inquiries should contact
Brian Hawrysh at bhawrysh@bcwood.com or 604-882-7100.

A return trip to China is currently being planned for Feb/Mar 2007 which will include company visits to end users and provide an opportunity for participating BC Wood members to promote their own companies at Woodmac, the largest wood products show in China. Members interested in participating in the February program should contact Brian Hawrysh as soon as possible, as the size of the group will be kept small and focused.

For more information on the Industrial Lumber mission to China contact Brian Hawrysh at 604-882-7100 or bhawrysh@bcwood.com

Resort Mission to China
Daryl Holmes

BC Wood recently hosted a group of members on an 8 day Resort Mission to China in March this year. The main goal of our visit was to develop strong business relationships with Chinese companies in view of exporting product to China. In particular, we were keen to partner with Chinese developers and designers to educate and promote the use of wood frame structures. Participating companies included Canadian North Log Homes, Longho Enterprises, Powerwood, Anglo American, Structurlam & Canada's Log People. Over the 8 day mission, the group visited a number of building and development sites and also participated in meetings with local developers. Members attending felt that the mission provided important and valuable insight into the marketplace in China for their products. The following are findings that were evident throughout the mission:

All products represented by our member companies were well received by Chinese delegates, however, the education level and knowledge of wood products was poor.
Locally, 2x4 construction is still a relatively new method of building that is being accepted by a few residential developers throughout the market.
The demand and acceptance of wood framed buildings is increasing slowly.
The supply of wood frame buildings is not to a standard we are familiar with here in Canada.
Skilled labour appears to be absent from sites we visited. The standard of wood finishing, both interior and exterior, is poor.
The marketplace does not demand what we consider to be high quality of building standards. The sites visits conducted were not indicative of our B.C. 2x4 and timberframe concepts.
Resort developers and designers are beginning to look harder at the use of wood in construction.
Resort or high end residential complexes are beginning to embrace the concept of wood construction, particularly in golf course developments and vacation developments.

The opportunity for members to sell into this resort marketplace is in its infancy and it will take a concerted effort from industry members to educate and promote the use of wood, before the demand for our products will increase. These opportunities rely on our ability to educate the local market on the quality and style of Canadian wood structures. Being able to locally showcase our brand of buildings is essential for successful growth in this highly competitive market.

For further feedback and information on findings from this mission, please contact Daryl Holmes at dholmes@bcwood.com or 604-882-7100.

Incoming Outdoor Wood Mission
David Pao

BC Wood recently organized an incoming mission from China for buyers interested in sourcing landscaping and outdoor wood products from Canadian companies. Buyers in this group were particularly interested in Western Red Cedar products and Pressure Treated Lumber. With site visits to 12 mills, remanufacturing facilities, and treatment plants, the group had a good opportunity to learn more about grading and sizing specifications in Canada, and a chance to see what products are readily available.

Forintek's Paul Morris hosted a seminar at the UBC office that focused on outdoor wood and pressure treated lumber techniques and applications. Landscape Architect Lindsay Gowler also provided a presentation on the uses of wood and highlighted several outdoor wood projects currently in the Chinese market. In addition to visiting Canadian companies, the group had an opportunity to visit several sites near Victoria to see outdoor wood in use.

The feedback from the Chinese buyers was very positive, with the definite potential for new business opportunities with member companies. Contact details for the group are available by contacting Brian Hawrysh at bhawrysh@bcwood.com or 604-882-7100.

2010 Wood Products Specifiers' Book

The deadline is now! Don't miss out on this unique opportunity, exclusively for BC Manufacturers.

The 2010 Wood Product Specifiers' Book showcases millwork, furniture, engineered wood products, log and timber frame homes, cabinetry and remanufactured wood products from B.C. Wood member companies.

This high profile book will be professionally designed and will incorporate high quality graphics and copy, showcasing your product.
The book will feature a leather bound, wood cover featuring one of four native hardwood and softwood species from B.C.
The book is targeted at, and will be distributed to, the architectural, design and construction community, who will play a key role in developing the 2010 Olympic infrastructure.
The book will provide your company with unique exposure to the key decision makers within these companies.
Approximately 250 copies of the book will be printed and distributed to select firms throughout British Columbia, Alberta, and the Pacific Northwest United States.

Space in the book is limited. To sign up, simply contact Dave Farley (dfarley@bcwood.com)at 604-728-8786. For further information and to see company samples, visit our website at www.bcwood.com and click on the 2010 Specifiers' Book icon.

Upcoming Shows and Events

Carrefour International du Bois
May 31 - June 2, 2006
Nantes, France

Distribute your samples and brochures at the Carrefour International du Bois!

The Carrefour International du Bois tradeshow is held every two years in Nantes, France and attracts the key decision makers in the Western European timber trade. This is an excellent venue to make contacts with buyers of Western Red Cedar, Douglas Fir, Hemlock and Western Hardwood specialty lumber.

BC Wood staff will attend this show and member companies can have promotional literature and samples distributed from a BC Wood generic booth. Please contact Brian Hawrysh at 604-882-7100 or bhawrysh@bcwood.com for more information.

BCIT "How To" Workshops
June 5th - 23rd
BCIT Burnaby Campus

Focused on productivity improvement, these workshops have benefited hundreds of local companies over the past sixteen years. Covering a variety of topics in the areas of:

Materials Management
Process Improvement
People Skills

The workshops identify where improvements can take place and how to actually implement them.

For more information please access the BCIT Venture Web Site as www.bcit.ca/venture.

Doing Business with China
May 23-24, 2006
Four Seasons Hotel
Vancouver, BC, Canada

This conference will provide PRACTICAL HANDS-ON MARKET ACCESS and 'HOW-TO' ADVICE for all businesses involved (or thinking about becoming involved) in wood and forest products trade between North America and China. It's also a 'must-attend' for North American manufacturers whose businesses are being affected by imports from China.

Chinese manufacturers will tell you what they need, what they can supply, and how your firm can do business with China;
North American manufacturers with years of experience will tell you what to do, and what not to do, in developing profitable business relationships with Chinese manufacturers;
World class experts will discuss the trade outlook, and market outlook, to 2010;
Business people from Asia and North America will be attending for the networking opportunities this conference offers.

British Columbia Institute of Technology ('BCIT') is hosting this conference, with the support of major industry stakeholders. This is an opportunity not to be missed. The speakers and networking opportunities are unique. The price is right.

At C$150 per person, this could be one of your best investments in 2006!

BCIT, Canada's premier polytechnic institution, has a particular interest in China. It has been very successful for many years at providing training and development services to China, and promoting the use of North American technology with specific emphasis on markets for North American wood.

For more information, contact:
Kit TamWoodbridge Associates Inc.
Tel. (604) 699-0182
Fax. (604) 699-0185
Email: kt@woodbridgeassociates.com
Website: www.woodbridgeassociates.com

Download PDF here for more information.

ASPEN OPPORTUNITIES WORKSHOP
Tuesday, June 6, 7-10pm
Raven Room, Town Square
Fort Nelson, BC

A joint workshop with Forintek & BC Wood

Are you interested in developing a business around Fort Nelson's valuable aspen? Come to our workshop and learn about the opportunities!

Forintek will present

Markets identified for different grades
Log and lumber inputs required
Lumber grade recovery
Raw material source and costs
Technical support available

BC Wood will present

Availability of market support through
- Trade Shows
- Trade Missions
- Global Buyers Mission
- In-market personnel
- Wood Supply Network (WSN)
Aspen Expo in Japan
Published literature available
Membership

For more information on this workshop, contact
Dennis Mawhinney via e-mail: mawhinney9467@shaw.ca, or
Tel: 604-532-9467

Download PDF here

RSVP May 22, 2006

2006 GBM Update
Randi Walker

As a member of BC Wood, by now you should have received your invitation to participate in the 2006 Global Buyers Mission, September 7th to 9th, in Whistler.

You probably heard that we pre-sold half the space to returning participants from the 2005 event, and not surprising; almost $18 million in new sales has been attributed to that one event!

Word has gotten out to buyers too and we already have registrations from Memphis, TN, Lakewood, WA, Cloverdale CA, Oklahoma City, Lansing, MI, Denver, CO, Hollister, CA, Worcester, MA, Santa Maria, CA, Seoul, Korea, Tokyo, Japan and Vorderthal, Switzerland.

Our Mission Leaders in China, Europe, Japan, Korea, Mexico and Taiwan are recruiting for qualified buyers in their respective markets and we should have no problem reaching our target of 170 buyers at this year's GBM.

You do not want to miss this great opportunity to make new connections to buyers from around the world - all at one exceptional event. Great business, great location and great fun!

Contact me at 604-882-7100 (rwalker@bcwood.com) or visit our website and choose the GBM icon on our homepage for more information on how to register - before it's too late!

Japan Market Update
April 2006
Jim Ivanoff

Japan Trade Shows
Every March BC Wood's Japan Program is highlighted by the Architecture and Construction Materials Show, organized by the Nikkei Newspaper Group. This show routinely attracts well over 200,000 attendees and is definitely the most dynamic of the shows we participate in. This year's edition attracted over 6.8% more visitors than 2005, for a total of 260,358 people.

This year also marked the largest Canadian pavilion at this show to date. With BCMON participating in this show for the first time and more BC Wood members taking part, our pavilion covered 32 booths in total. It was also the second largest pavilion at this year's exhibition.

As with the Japan Home Show last November, the effects of the growing Japanese economy could be noticed on the show floor. Not only was attendance up overall, but the interest level of the attendees in looking for products was also seen to have greatly increased. Exhibitors were also showing their confidence in the economy. This was demonstrated by the many new and extravagant displays that brought excitement to the show floor. While the overall design of Canadian pavilion remained the same as last year, this year it benefited from a new twin island layout that ensured that all booths had good traffic flows.

BC Wood had 10 members represented at this year's show including BC Door, Insulspan, Lake Country Log Homes, Loewen Windows, Masonite Doors, Merit Kitchens, Pacific Rim Cabinets, Sauder Mouldings, Snowcap Lumber, and Tamlin Homes. One of the main reasons that BC Wood member participation has grown at this show is that it attracts many architects and design offices who work on higher-end projects. Such attendees are a prime target for Canadian manufacturers of high-end building products.

Western Japan Total Living Show
Aside from the large, national shows to which BC Wood actively recruits individual members to take part in, BC Wood also exhibits at key regional shows representing all members. While these regional shows cannot be compared in scale to the national shows, they are nonetheless important events that help us to make inroads into local markets beyond Tokyo. This past year, we did 3 of these regional shows, including the Total Living Show in Kita-kyushu from March 17th to 20th.

BC Wood returned to the Total Living Show in 2006 after a one year absence. The last time we exhibited at this show in 2004, the results were mixed as it was felt that the Kyushu economy was still suffering. In 2006 it was a completely different story with builders and importers actively looking for products and a much more upbeat mood in general.

Based on the interest in log homes we received in 2004, Lake Country Log Homes decided to take part with us this year. As in 2004, the Consulate in Fukuoka organized a Canadian aisle at the show which incorporated BC Wood, the Consulate display, and 2 other local distributors of Canadian products. This set-up worked well and was a good counter to the US section at the show.

Being a regional show, the TLS does not attract the large numbers of visitors like the JHS or Nikkei Shows. However, the TLS remains the main construction industry show in Kyushu and as such, attracts key industry people from across Kyushu and southern Honshu. This year we noticed much more interest among visitors in importing products which indicates that the Japanese economic recovery is starting to reach Kyushu. While Kyushu had been a depressed region for many years, major Japanese corporations have started investing heavily there to build new production facilities. This has been led by the Toyota Group which can no longer find enough workers in its home prefecture of Aichi, as well as major electronics manufacturers who are bringing production facilities back to Japan from China. These new, well-paying jobs seem to be improving the prospects for the Kyushu housing market.

Another positive development at the TLS was that we had very few end-users coming to our booth, which was a big reversal from 2004. I believe this also explains why the show's atmosphere improved despite the overall attendance being slightly down. The organizers also told us during the show that they have been trying to refocus the show towards industry and away from the general public. Hopefully this strategy will be continued for next year.

New Window Labelling System
As a part of the Ministry of Economy, Industry, and Trade's (METI) efforts to promote energy efficiency in Japan, they have decided to ask window and sash manufacturers to voluntarily label their products with basic energy efficiency information. While importers fear new METI regulations as being potential non-tariff barriers, METI's stated goal is to get this information to end-users so they can make an informed decision about buying energy efficient products. In this case, their efforts seem to be primarily aimed at getting spec housing and condominiums to switch from single to double-paned windows.

The Import Building Materials Association (IBMA) is leading a group of companies to make sure that imported products are not unfairly treated by these voluntary regulations. They are looking at establishing a labelling system for imported windows, similar to the one established by the domestic industry. However, it is questionable as to whether this is necessary or not as under METI's guidelines. Even manufacturers can label their own products and they have stated that foreign performance data would be acceptable. The biggest concern for imported window manufacturers is whether or not METI decides to make these "voluntary" guidelines mandatory in the future, with testing systems that will require Canadian manufacturers to have their products retested in Japan.

In order to monitor this situation, BC Wood's Tokyo office staff have been taking part in consultative meetings organized by the IBMA. We have also decided to approach METI directly over this issue and will thus jointly meet with METI, along with our Canada Wood partner QWEB and Canadian Embassy officials on May 10th. By working with our members and partner organizations, BC Wood will come up with a strategy to deal with these regulations to ensure that our products are not discriminated against in the Japanese market.

While new regulations such as these are not normally viewed in a positive way by manufacturers, this initiative may end up increasing the opportunities for high-performance Canadian windows in Japan. This is due to the fact that there has been very little consumer awareness about the energy efficiency of homes/ building products and thus, windows are most often chosen based on price only. If this effort by METI is successful, more builders might be persuaded to use higher performance windows, creating a larger potential market for Canadian manufacturers.

Contact Jim Ivanoff at ivanoff@canadawood.jp for more details.

Anchorage Home Building and Renovation Show
Daryl Holmes

The Anchorage Home Builders Association Home Builder & Renovation Show was held on March 17th- 19th, 2006. This show was the final show in BC Wood's 2005-2006 market development program and was attended by the following companies: Viceroy Homes, Pacific Homes, Woodtone Building Products, Hamill Creek Timberwrights, Old Yale Log Homes, and Insulspan. This regional show has been a valuable sales and marketing vehicle for members in the past 4 years and continues to be a fruitful endeavour for our industry attendees. The show itself attracts local builders, developers, architects and also end users. Over the 3 days, members were able to not only secure new sales leads but also continue to service existing business relationships within the Alaskan market.

While the Anchorage market is considered a small niche regional area, it has begun to grow in opportunity for our reman, prebuilt and timberframe members. The areas surrounding Anchorage, (Matsu Valley), has continued to develop and house builds have been increasing rapidly. Land availability in Anchorage has been scarce, which has opened up the market in the neighbouring areas of Wasilla and Palmer. These newly developed areas will continue to grow in the next 5-10 years and the presence of BC manufacturers is welcomed by home owners and builders, who value the quality and service Canadian companies can provide. B.C Wood's goal is to maintain our presence in this market and grow our marketshare, in keeping with the growth of the local development in the Alaskan marketplace. We will be returning in 2006-2007 and will be further investigating other geographic areas of Alaska in order to capitalize upon other opportunities outside of Anchorage.

To sign up for our activities in Alaska, visit our website or contact Daryl Holmes at 604-882-7100 or dholmes@bcwood.com to discuss your participation.

Lumber Manufacturing and Product Knowledge Course

BC Wood and Canadian Mill Services will be offering a Lumber Manufacturing and Product Knowledge Course in mid to late June. This two-day course will cover a number of topics and will be ideally suited for those in the industry without a formal background in wood or those looking to brush up on their understanding of wood products. Marketing, sales, and other support staff will find this course an excellent opportunity to better understand the terminology, manufacturing process, and end-uses of product in the wood products industry.

Topics this course will include:

Grading and Lumber manufacturing terminology including lumber recovery
Lumber remanufacturing from logs to lumber
Interior Species - End uses and identification as lumber
Coastal Species - End uses and identification as lumber
Wood structure and properties - lumber grading characteristics
Introduction to structural grade rules
Introduction to appearance grade rules
Plant health regulations in the international market place

This course is tentatively being scheduled for late June. If you are interested in this course, please contact David Pao as soon as possible at dpao@bcwood.com or 604-882-7100 to register.

New BC Wood Staff

Please join us in welcoming Cindy Esgen to the BC Wood team. Cindy is our new Receptionist/Admin support person, replacing Kathy Dorrington, who has moved on to a challenging new position with Tryton Industries. Cindy's strong administrative and organizational background will be of tremendous assistance to BC Wood and our members. Cindy can be reached at cesgen@bcwood.com or 604-882-7100.

Got Something to Say?

If you have any questions, comments, or would like to contribute to BC Wood News On-line, please contact David Pao at:

BC Wood
#200 - 9292, 200th Street
Langley, BC
Phone: (604) 882-7100
Fax: (604) 882-7300
Toll Free: 1-877-422-9663
or email dpao@bcwood.com

March/April 2006	Volume 3, Edition 37

Copyright 2004. BC Wood, All Rights Reserved.
For past issues of this newsletter, please see the archives.