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| May 1, 2003 | Volume 2, Edition 12 |
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Innovation and Value-Added Products Bill Downing, CEO For the secondary wood products sector to grow, we need to foster and promote innovation. Fortunately, we have many innovative people in our industry and I am amazed at the ingenuity I witness in the development and manufacture of value-added wood products. Case in point: Mr. Brett Malcolm of Osoyoos.
A major advantage of the Z-Stud is that it can be manufactured using lower grade lumber or lumber from small diameter loges. In addition, a Z-Stud uses half of the solid wood fibre of conventional lumber and can be produced to conform to a variety of standard or custom dimensions. Although Brett has had interest from US investors, he is keen to partner with one or more BC firm’s to manufacture and distribute the Z-Stud. If any members are interested contacting Brett, his number is 250-495-2472. Innovative ideas like the Z-Stud could have worldwide implications and BC Wood encourages members to work together to bring innovative new products to market. 
BC Wood Tradeshow and Mission to Southern China, March 2003 Simone Liang, Marketing Coordinator, Asia Pacific - China This past March, BC Wood offered a wood tradeshow and mission to Guangdong province, China. The focus was on supplying specialty lumber and components to Chinese furniture manufacturers and other wood buyers. Participants had the opportunity to attend the Furniwood tradeshow, the mission, or both.
The majority of the furniture and associated products displayed at the
China International Furniture Fair were of In the Furniwood section of the tradeshow, BC Wood’s first full-size generic China booth (20 x 20ft), featured a wood kitchen, staircase, flooring, window and door. The booth was very popular among attendees and other exhibitors as it promoted BC wood species to many buyers who were not familiar with the species. Many professional visitors were amazed by the versatility of hemlock and the finishing quality of the kitchen cabinets. Inquiries for hardwood and softwood lumber and components, as well as for solid wood kitchen cabinets, were generated during the four-day tradeshow.
Opportunity Knocks in South Korea Mike Jahraus, Managing Director - Asia Pacific South Korea, which achieved an impressive GDP growth rate of 6% in 2002, has registered as the 13th largest economy in the world. It is clear that South Korea has now recovered from the Asian financial crisis of 1997/98. Wood and wood product imports are showing strong growth and the five BC Wood members that recently attended the Homdex trade show in Seoul all spoke highly of their experience. The future looks bright for wood and wood product opportunities in South Korea because of a number of factors:
BC Wood plans to develop a mission to Korea in February of 2004 for new entrants into this market. The focus will be on lumber, components, building products and interior decoration materials, with visits to a major tradeshow, housing developments and building product distribution centres. If you are interested in participating in this mission, please contact Mike Jahraus at mjahraus@bcwood.com. For more information and to view reports on the Korea market, please visit the Members Only section under BC Wood Marketing Programs.
Member Spotlight: All-Wood Fibre Mary Quinn, Market Research After attending the Southern China Mission and Tradeshow with BC Wood this past March, Albert Smith, Marketing Sales Manager for All-Wood Fibre, is quite pleased with the results. All-Wood Fibre operates a whole-log chipping business servicing Western Canada. In 2002 owner Leonard Legault, in consultation with Albert Smith, decided that it was time to explore and diversify opportunities for Aspen, Birch, Alder, and SPF niche products. Today All-Wood Fibre produces tongue and groove wall paneling, furniture stock, and millwork. After buying lumber and cants from small manufacturers, it is dried, further manufactured, and sold through sales groups to the final buyer. All-Wood’s competitive advantage is that they are the only manufacturer in Prince George currently drying, re-sawing, chopping and moulding hardwood products, all within the same company.
The China mission included attending the Furniwood tradeshow, which
focuses on furniture materials and accessories, where BC Wood exhibited
its first tradeshow booth specifically designed for the China market.
As part of this booth, Albert displayed species samples of
Aspen, Birch and Alder. He wanted to introduce these
For the mission portion, a group of twelve BC Wood member companies visited eleven factories in China and attended six business meetings. Albert thought that the trip was very well organized and arranged by the BC Wood staff in Abbotsford and China. "They really overextended themselves to make sure that everything was OK."
Albert offers some advice for future mission attendees, "If you can, give yourself some lead time and make sure that you have all of your brochures and samples ready." In addition, Albert thinks that you should know what you would like to achieve on the trip before you leave. "Know what the market is doing, but plan and expect that things will change. You must be flexible and adaptable, as things change so fast. Go with an open mind and you will get more out of the trip." Future plans for All-Wood include marketing their products to the Pacific Northwest. They are also planning to build an exhibit and attend a tradeshow in this area. Things in the interim look very good, as currently they are selling more than they can produce. Their only concern is securing fibre and while remaining competitive on manufacturing costs.
Update on the Members Only Section Mary Quinn, Market Research Members Exchange Section Located within the Members Only section of the BC Wood website, the Members Exchange Zone is a forum for BC Wood Members and Associate Members to post information. This could include information such as items for sale, employment opportunities, networking opportunities, or events. What better way to get your message across to the secondary wood products industry? Ads are free of charge and can be displayed for 30 or 60 days. If you have an ad that you would like posted, or if you need more information, please contact Mary Quinn at BC Wood. New Reports in the BC Wood Resource Center BC Wood receives and sources market intelligence reports on a regular basis. Some of these reports are not available in electronic form but in hard copy only. You can find out what the latest reports are and some brief descriptions of them by going to the Members Only section under Market Intelligence, Resource Center, What’s New in the Resource Center. Here is a listing of the newest reports in the Resource Center:
Home Improvement and Furnishings in China: A Market Analysis
Research Report on Furniture Industry and Market of China For more information on these reports, please contact Mary Quinn at BC Wood.
Canadian Housing Starts for 2003 "Low mortgage rates, continued employment, income growth and rising migration, will support a vibrant housing market again this year", said David Weingarden, Senior Economist at CMHC. "Construction will remain robust in 2004, with housing starts reaching 195,100 units. The slight decline in housing starts in 2004 will be due primarily to expected increases in mortgage rates. Housing starts in British Columbia will rise again this year as market conditions improve. This will continue in 2004 with the province expected to have the highest percentage growth in housing starts in the nation in 2003-2004. Source: CMHC
USA Housing Starts for January Total permits to start housing construction, an indicator of builders' confidence in future business, fell 5.6 percent last month due to a drop in authorizations for multi-family homes, the Commerce Department said. But single-family permits - the largest category of housing starts - rose to a new high. New single-family homes were constructed at a seasonally adjusted annual rate of 1.51 million units in January. "This was up 2.1 percent from December’s strong number and the fastest production pace since November of 1978. It also is just shy of the fastest construction pace on record - 1.53 million single-family units started in December of 1977," said NAHB President Kent Conine. Multifamily housing starts declined 7.6 percent to a 340,000-unit rate in January following a big jump in December. Source: NAHB
March Housing Starts in the USA Figures released today, by the U.S. Commerce Department, showed that new homes were started at a seasonally adjusted annual rate of 1.78 million in March, an increase of 8.3 percent from February's pace of 1.64 million units. Single-family starts in March climbed 7.7 percent to an annual rate of 1.41 million and the rate of multifamily construction during the month quickened to a pace of 366,000, a 10.6 percent gain. Source: NAHB
Canadian Building Permits, February 2003 Builders took out permits worth $2.4 billion for housing in February, down 14.2% from January. But again, the decline came on the heels of a record high in January, and February's total remained just 1.4% short of the average monthly level in 2002, which was an exceptional year. In the non-residential sector, construction intentions fell 1.9% to $1.5 billion. However, they were still 7.0% higher than the average monthly level in 2002. A sharp drop in commercial permits more than offset gains in the institutional and industrial components. So far this year, municipalities have issued a total of $8.2 billion in building permits, up 10.4% from the same period of 2002. It was the best showing ever for the first two months of any year, as both residential and non-residential permits were well above last year's cumulative levels. In the coming months, as these intentions materialize, the construction sector will remain healthy. Source: Statistics Canada
Japan Housing Starts for 2002 In general, the housing industry was in a ‘boom’ situation when starts exceeded 1.5 million per year. Compared with the strong U.S. market with 1.85 million housing starts for 240 million people, 1.5 million housing starts for 120 million people in Japan appears to be a lot. In 1987, amid the bubble economy, housing starts peaked at 1.73 million. On the contrary, the current level of 1.1 to 1.2 million housing starts is indicative of recession. One of the features of Japan’s housing industry is rapid swings in levels of construction and supply. Sudden drops in starts have been experienced three times in recent years: by 18.3% in 1980, 19.4% in 1991 and 17.7% in 1997. According to Mr. Makoto Koshiro, an expert in the housing industry, the main characteristics of the new housing market as revealed by recent statistics is that housing starts have been steadily trending down since the plunge in 1997 and that annual increases have been seen only in rental starts (up 2.7%). There has also been a noticeable slump in prefabricated new housing starts. In 1992 the share of prefabricated housing starts reached its peak at 17.8% (253,000 units), but has been decreasing since then. On the other hand, the share of 2x4 starts expanded from 3.8% (54,000 units) to 6.9% (79,000 units) over the same period. This proves that the 2x4 housing market is maintaining steady growth and increasing popularity in contrast to the domestic prefabricated housing manufacturers. Source: JETRO |
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This year's AGM, "Exploring New Paths - Connecting for Profit", will be held at the Sheraton Wall Center Hotel and Conference Center in Vancouver from October 1st to 3rd. Check the BC Wood website regularly for updates on our program, sponsorship opportunities and registration details. If you have any comments or suggestions for this years event, please contact Randi Walker, Manager of Member Services at rwalker@bcwood.com, or call our office toll free at 1-877-422-9663.
BC Wood Japan Office Announcements Mike Jahraus, Managing Director - Asia Pacific It is with regret that we announce the resignation of Tetsuya Furuta from his position as the BC Wood Japan Market Representative. Furuta-san was with BC Wood just over two weeks when his father unexpectedly passed away. Furuta-san’s strong product knowledge came from his experience with his family’s building products distribution company. In this difficult time for his family, he was requested to take over the family business from his father. We wish Furuta-san and his family all the best. BC Wood will be going through another hiring process in May and we plan to have a qualified candidate in place by June.
$12-M Partnership to Open Up Chinese Housing Market April 17, 2003, Vancouver - The government is partnering with B.C.’s forest industry on an aggressive five-year strategy to open up new opportunities for B.C. wood products in the fast-growing Chinese housing market. Premier Gordon Campbell, Forests Minister Michael de Jong, forestry industry leaders and members of the Chinese-Canadian business community announced the new marketing strategy today in Vancouver. Click here for the entire article.
The next set of tips, from Associate Member Exhibitree, is targeted to international exhibitors and stresses the importance of knowing your audience when visiting different countries. 1. Study different forms of business etiquette. Know your audience and how to greet and address them. Formality is the norm for most cultures, using titles rather than first names. Shaking hands is customary for most Europeans. Asians usually avoid body contact - Japanese welcome guests with a bow, Chinese nod, bow or clap. 2. Treat business with respect. A business card is like a passport showing status and identity. Give the same respect to a person's card as you would give the person. Study cards that are given. Never write notes on them, fold or even shove them in your pocket. On the reverse of the card, consider printing in the local language using a professional translation service. 3. Understand the significance of colours and numbers. Be sensitive to the meanings of colour and symbols in different countries. To be safe, always do your research. For example, black, white, yellow, and purple are often associated with funerals in Japan (purple in Brazil and yellow in Mexico). Red and yellow are considered lucky in China. In many Asian countries, "four" denotes death and should be avoided, including products packaged in fours; "seven" and "eight" are lucky numbers.
New Associate Members We are pleased to welcome the following Associate Member who has joined us since the last issue of BC Wood News On-line. If you are interested in learning about the benefits of becoming a BC Wood Associate Member, please contact Randi Walker at 604-556-3373 or toll-free at 1-877-422-9663.
Panalpina Inc. offers world-class forwarding services with 480 offices in 74 countries and agent partnerships in 62 countries. Air and Sea freight, logistics and supply chain management, door-to-door services based on regular, scheduled connections between all six continents. We are in the business of moving freight.
Regula Vickery
UPS Supply Chain Solutions UPS Supply Chain Solutions invites you to a luncheon seminar on Current U.S. Customs Initiatives on May 15 in Richmond. See the brochure for more information. Email mary.pen@ups.scs.com or fax 360-332-0158 before May 2, 2003 if you are interested in attending.
Catalyst Training Services Inc. Catalyst Training Services Inc. is two holding seminars on Front Line Leadership in Burnaby, BC (May 15 & 22) and Courtenay, BC (May 27 & 28). Front Line Leadership enforces the principle that every level of supervisor is responsible for creating an environment in which people understand what is expected of them, can communicate effectively with each other, are involved in decision making, and take accountability for the work entrusted to them. For more information, please see the brochure or call Dan Monteiro at 604-298-5505.
Canada Training Group Canada Training group is holding a session on Hydraulic System Maintenance & Troubleshooting Level 1 in Vancouver on May 26-27, 2003 and in Prince George on May 22-23, 2003. For more information or to register call 1.866.306.5421 or visit the website at www.canada-training-group.ca.
Venture Kamloops Wood Products Manufacturing Forum Venture Kamloops is hosting the second Wood Products Manufacturing Forum focused on strengthening the competitiveness of this industry for Solid Wood Manufacturers, Engineered Wood Producers, Home Builders, Finished and Semi-Finished Manufacturers. Forum II: Friday, June 13th, 2003 at the beautiful South Thompson Guest Inn, Kamloops, BC Topics & Speakers:
Financing – Implications of the Proposed New Forest Policy
Inventory Control – Systems That Can Save You Money
Marketing Opportunities – Korea New Technology in Saw Filing - Forintek
Keynote Dinner Speaker – Gordon Wilson And much, much more!
Details and registration information at:
International Contemporary Furniture Fair
Interzum
PCBC
Market Showplace For more information on these tradeshows, visit the BC Wood website.
Consultants & Marketing Services
If you have any questions, comments, or would like to contribute to BC Wood News On-line, please contact BC Wood
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Brett has recently obtained a patent for his wood product invention,
the Z-Stud. The Z-Stud is a composite structural framing member similar
to the "I" type joist. It has a basic "Z" configuration with solid wood
flanges bonded to a diagonal OSB type web. The resulting composite
provides a straight, strong and lightweight framing member that can
be used in both horizontal and vertical framing applications. 
The China International Furniture Fair, which Furniwood is part of,
is recognized as one of the key furniture tradeshows in China. This
year the tradeshow attracted over 40,000 visitors from all over the
world, representing the following product categories: home furniture,
office furniture, decorative items, carpet, furniwood
(furniture materials), woodwork (woodworking machinery),
home textile and decorative fabrics.
high quality, and many firms
offered OEM services (a manufacturer that produces products that are
marketed under another company's brand). These products are primarily
for export and are typically ordered on a custom basis by US and European
clients. Consequently, overseas buyers were the key target audience for
these furniture manufacturers.
Due to the success of BC Wood’s previous mission in September 2002
to Guangdong province, BC Wood organized a second mission trip back to
the same area, following the Furniwood tradeshow. The trip placed a strong focus
on supplying specialty lumber and components to local furniture
manufacturers, other wood product manufacturers, and lumber
wholesalers. Twelve BC Wood members and staff 
participated in this
mission visiting eleven organizations and attending seven business meetings.
Feedback from mission participants has been excellent and business is
being developed from the meetings and leads generated.
A full trip report, including product inquiries and pictures, will
be available in the 
All-Wood Fibre took part in BC Wood’s
Market Expansion Program earlier this year to define their marketing plan.
Going through this process identified that they should divide their export
markets equally between China, the USA, and Canada. With China now
representing a third of their export market, All-Wood decided to attend
the BC Wood China mission to seek out opportunities, to expand their
business, and to make contacts. "You can read and hear all you want,
but nothing quite equals the first-hand experience," explains Albert.
"You have to go to the market to be successful in international
marketing."
new species to
Chinese furniture buyers so that they could actually touch and see
the samples. The attendees at the show were very interested in
the species and how they could be used in furniture manufacturing.
"The Chinese are open to all wood species as they all look similar and you
can not tell the difference between them once they are stained and
finished," claims Albert.
Other exhibitors in attendance displaying the same species came from
Europe, Eastern Canada, and Eastern USA. Albert believes that BC
manufacturers have a distinct advantage though, "Since we are right on
the Pacific Rim, we can ship to these countries at a much lower cost than
the Eastern USA." However, the hardwood industry in BC is very
underdeveloped, so many potential customers are getting hardwood products
from Eastern Canada and the USA. "There is lots of opportunity for this
industry to grow," adds Albert.
Having set some expectations prior to his trip to China, Albert is happy
to say that they have been achieved. He wanted to take advantage of
networking with the other members on the mission, but most of all, he
wanted to meet potential customers face to face and gain some sales and
marketing contacts. "As some of the buyers we visited listed Aspen as
an interest, I knew that we would be a good fit for this mission," adds
Albert. Another objective of attending the mission was to evaluate what
the Chinese are doing with wood and how All-Wood’s products fit in.
"I came back from China with all my expectations met. Our products
are definitely a match to what they are looking for."
When asked about any cultural differences, Albert was quick to add
that everything was looked after for them, so there really wasn’t anything
to worry about. "All you have to handle is customs and passport documents.
The biggest part is the preparation, and BC Wood does a good job of taking
care of that," claims Albert.
According to Albert, the greatest benefit of the trip was the mission
portion. "With the tradeshow portion, you don’t really know who the
attendees are and it is hard to determine why they are at the tradeshow.
However, with missions, you know exactly who you are visiting and
what they are interested in. This allows you to prepare your questions
and pricing information," comments Albert.
| May 1, 2003 | Volume 2, Edition 12 |
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| Copyright 2003. BC Wood, All Rights Reserved. | |
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