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| May 5, 2004 | Volume 3, Edition 23 |
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Japanese Market Update: May 2004
Small Log Type Structures Currently, some of these importers are bringing in such structures from Finland and the US. One importer in Hokkaido claims to be selling 400 Finnish made sheds a year. They have high regard for the Fin sheds because of their excellent quality and attractive designs. The following are some examples of imported sheds I’ve seen at a DIY (home centre) here in Japan.
Currently, I have two clients who are looking for companies in Canada who might be able to supply such structures. Please contact me if you are interested in pursuing these inquiries at ivanoff@canadawood.jp.
Judo Association Loves Canadian Wood In addition to the beautiful heavy timbers, architect Kenichiro Takahashi chose to use many other Canadian building products including WRC paneling and hemlock doors. In a country where steel and concrete are considered the norm for commercial buildings, Takahashi-san had to give numerous presentations in order to convince committee members that a wood frame building was their best option. As a result of his tireless efforts, 350 guests from across Japan were able to see for themselves the possibilities offered by wood.
With the recent regulatory changes allowing for four-story wood buildings and the high cost of steel, Canada Wood sees great potential in increasing the share of wood frame commercial buildings in Japan. Working together with the Canadian Embassy and innovative architects like Takahashi-san, we will be looking to actively promote such structures and develop new opportunities for BC Wood members in the Japanese market.
Japan Tradeshow Information Session 
Thomas Moser Mission with BC Wood
New York City has to be one of the most vibrant cities in the world. Frank
was right when he said it was "the city that doesn't sleep". By visiting
various furniture stores and hotel lobbies, we got a good sense of
what
was "in" in the design world. From Yabu Pushelburg’s W Hotel with a
sophistication you wouldn't expect in Times
The main reason for the trip was to see Thomas Moser and his facility in Portland, Maine. Many of you who attended our conference last year will remember the presentation given by this remarkable man. Upon our arrival, we were met by Harry Fraser, CEO of Thomas Moser Furniture. He immediately took us for a meeting and tour of Thomas Moser’s factory. It was great to hear that Thomas started much like the rest of us and has built his company to over 100 employees and sells his product all over North America. His vision of high end, mass production furniture has really come through due to his focus on branding, persistence, a clear vision, and above all, customer service.
Due to the great efforts of Harry Fraser, we were able to see much smaller businesses in and around the same area. Bill Huston of Huston and Company was kind enough to take us for a tour of his facility which included a workshop and very attractive showroom. He has four employees making furniture and sells primarily in and around the state of Maine. Bill worked with Thomas Moser when Tom first started out, but has gone on and built up a nice business for himself and his employees. Another stop of note had to be the visit to the Lee-Nielson Company, makers of hand planes and wood chisels. This was another classic case of someone doing what they love with a clear vision, persistence, and great dedication to create a successful, growing business in the woodworking world. Speaking for myself, what do I think the group gained from this experience? We, as BC wood manufacturers, have to create our own niche markets and create work that can only be found in BC. We need to create our own branding that speaks out "this is from BC". This kind of trip is invaluable to the small manufacturer to really see what is out there and what we need to do to compete for that proverbial "piece of the pie". On behalf of the group, I would like to thank Dave Farley and BC Wood for creating these opportunities that over the long term, will have a great deal to do with the success of our businesses.
BC Wood Mission to Shanghai, China
This past March, six BC Wood members took part in a mission to Shanghai,
China. This mission was designed for producers and exporters of industrial
wood components (hardwood and softwood) and veneers for the furniture,
giftware and interior decorating products manufacturing industries in
China.
Ernie Thiessen of Squilax Timber was one of the mission attendees. This was Ernie’s third trip to China and he chose to participate in this mission in order to visit some current prospective customers and to meet some new ones. Dealing mainly with birch lumber, he was hoping to make some new furniture manufacturer contacts. Fortunately, as a result of this mission, he has a new prospective customer for Western Red Cedar lumber products. "This market is really developing and I think it holds good things for the future," commented Ernie. He added that his future plans include working on obtaining more contacts for birch and other species. This mission was the first one for Tony Pistilli of Carlwood Lumber. He attended the mission to gain a better understanding of the manufacturing structure in China. He also wanted to obtain new importer and customer contacts for his products. Carlwood sells maple, alder and birch hardwood lumber to the US, Europe, Japan, Korea and Vietnam. Currently, China encompasses 50% of their business activity, producing a dry, dressed lumber for furniture manufacturing. Tony was very pleased with the contacts he made during the trip, adding that, "We got to meet some new manufacturers who we have been quoting regularly." Tony also had some advice to offer members when traveling overseas, "Go into the market with an open mind and willingness to seek new products, customers, and ideas. You must be creative and willing to adapt your product to their needs." Tony plans to go back to China this year in order to solidify his contacts and meet more people. For upcoming BC Wood events in China, please contact Mike Jahraus at mjahraus@bcwood.com or visit our website.
BC Wood Member Spotlight: Pacific Homes
The Pacific Homes division of the company manufactures panelized homes for the domestic and export markets. Grant McKinnon, Pacific Group Partner, handles this division as well as the forestry side of the business. In the last couple of years, the homes division has doubled their sales, mainly due to their exceptional staff, service, and word of mouth recommendations. Pacific Homes feature their own "smart walls", which are prefabricated and insulated wall systems that are energy saving, healthier, and quieter than traditional wall systems. The homes are built with kiln dried SPF lumber that Pacific Homes accesses from their own in-house lumber broker, and sometimes from their own logging operations.
And he’s not kidding. In addition to manufacturing their own wall panels and trusses, they also manufacture stairs, joists, siding, and hang their own doors. For what they can’t do, Pacific Homes works with many community suppliers for interior housing components such as mouldings and windows.
With agents in Korea, California, and Alaska, Pacific Homes has made the US and Korea their biggest markets. They have also built homes in Costa Rica, Chile, the Bahamas, and Europe. "We have a good presence in the US because we are competitive on price and offer quick service. In the US, the labour is so expensive that it is cost effective for them to buy homes that are prefabricated in Canada. With the Koreans, they don’t have a large wood trade of their own, but have a substantial appreciation and affinity for it. As they don’t have wood frame or panelized homes available in their own country, they import them from Canada," comments Grant. Having dealt with many government agencies in the past, Grant says that BC Wood understands its members the best. "With their in-market representatives and program managers, they understand the secondary wood industry and have the same frame of mind as members do. BC Wood not only informs markets about BC wood products and builds a brand name for the province; they also help members attain their goals in the short-term." Last year, Pacific Homes attended the International Builders Show on their own. "We didn’t display at this show but instead, walked the show and researched the new products on display and saw what the competition was doing. We soon realized that our best option would be to exhibit with BC Wood in their booth space. The fact they we can cost share show expenses with BC Wood makes the shows very affordable to attend." Grants adds, "BC Wood is very focused and selects the right shows for their members in the markets that will bring them the greatest opportunities. They promote products, like members would promote their products, and select the shows that members want to go to." For the future, the main thing that Grant would like to focus on is managing their growth. "We are growing so much every year and we have just purchased some new machinery. We need to work out the bugs on the processing side so we can keep up with the demand."
Product Differentiation
Last month we examined the merits of doing your homework in the market. One
of the results of good market due diligence should be gathering information
you can use to better differentiate your products and your company.
Probably one of the most important acronyms in marketing is "USP", short for Unique Selling Proposition. Developing USP’s is the process of differentiating in ways that are meaningful to and valuable for your customers (as opposed to differences for differences sake). Far from puffery, a strong stable of USP’s can have a direct and beneficial effect on profit margins. Why? How many times have you heard someone say that all they care about is price? Well, when all other things are equal, can you blame them? The point being, that if there are no differences in the buyer’s mind between and amongst competing products’ features and benefits, quality standards or the manner in which the product is sold, provided, delivered or supported, it does come down to price in isolation, because price is the only differentiator left. There are multiple ways to differentiate finished products, particularly consumer items. Obvious ways concern athletics, quality levels, product features, ease of use, warrantees, etc. Not so obvious ways include ancillary services, delivery, distribution, etc. I can hear readers who manufacture commodities or component parts saying "Yeah John, but lumber is lumber, a turning square is a turning square, a veneer is a veneer, etc." OK, so let’s take lumber as an example. Is my lumber better than your lumber? Assuming it’s the same species manufactured to the same specs, maybe not, but here are the USPs that you might not have incorporated:
I could go on, but so far, the above list hasn’t really done anything earth shattering with the hypothetical product. What the list illustrates is that by studying specific customer needs and challenges, you can modify and enhance both how you provide your product, and the services you bundle with that product. Value-added is not just about adding utility to product, it's also about walking the walk in customer partnering – providing customized value in the way you deal with customers. Will customers pay for all of these added features and benefits? Depends. The key is, if you can demonstrate that the customers will save time or cost over brand X, chances are they will pay an increment, provided this is realistic. To illustrate, look for features and benefits that cost you $1.00 but which might represent $1.50 or more in savings or perceived value to your customer. This is how similar products can be differentiated for those who take the time to walk in their customer’s shoes. Together with better cost controls, this is also how margins can be enhanced.
John Kenmuir is a Certified Management Consultant and
US Construction Market
Building Permits
Housing Starts Source: US Census Bureau
Top 10 States for Housing Starts 2003
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Report on Market Opportunities for Value-Added Wood Products in the UK
Coming soon to the BC Wood Members Only website, is a report on the Market
Opportunities for Value-Added Wood Products in the UK. This comprehensive
report will cover all sectors. The purpose of this report is to:
Please check back for an announcement on the posting of the report to the Members Only section.
European Market Report, May 2004
Still looking West? That’s what Europeans did years ago. Now, it is
time to look East!
The next European show coming up for BC Wood is Carrefour International du Bois. This is one of the best professional shows for lumber suppliers (including semi finished/components) in France. If you can supply Western Red Cedar you should attend this show as France is desperate for it. I would strongly recommend participating in this show, which is held from June 2-4, 2004, as it holds great potential for sales opportunities.
We also attended the biggest building show in the UK, Interbuild in Birmingham from April 25-29. At this show, the Canadian Pavilion acted as an umbrella for more than a dozen Canadian companies, plus several associations and government bodies from all over the country. I might repeat myself, but I think it is worth it: With a commitment to regional habits and demand, you could do a great job and big business on this side of the Atlantic!
Sick House Issues Under the Amended Building Standard Law in Japan
Implemented on July 1st, 2003, the Building Standard Law was revised to deal with
"sick house syndrome". These regulations were brought
in to restrict the use of building materials with potentially harmful chemical
emissions, and mandated the installation of ventilation equipment. Chemical
substances presently covered by the regulations are chlorpyrifos and
formaldehyde. Recently, I attended a seminar which discussed what has been
happening since these regulations have been enacted.
In less than one year, building materials, which meet the sick house
standards, have been spread through the market. The grade of the building
materials is now labeled on each product. The label indicates that the
materials have been evaluated and categorized according to the Ministry of
Land, Infrastructure and Transport’s regulatory system.
However, just having the certification is not enough. The labels must also be found on job sites and the certified materials must be documented as being used at the job site during construction (a photograph must be specifically taken and submitted by builders and/or architectural offices). The revised law also states that it is mandatory to install ventilation equipment that runs non-stop for 24 hours a day in all rooms classified as "habitable rooms". There are three categories of living space outlined in the amended law. They are habitable rooms, ceiling cavities, and regulation exempt areas (non-habitable rooms). It has been a growing issue that the areas which are not considered habitable rooms, such as corridors, stairs, and bathrooms, are actually ending up becoming subject to the regulations by default as they become part of the overall airflow plan when the ventilation system is being designed. There are many issues like this that appear only after the builders begin working on their projects. As a result, manufacturers have to make great efforts to provide as much information as they can to local builders who are working closely with these new regulations.
Enjoy BC Forests During National Forest Week
This week is BC’s National Forest Week and the theme this year is Canada’s Forests: A Fine Balance. The week was established in 1926 by the Canadian Forestry Association and originally called Forest Fire Prevention Week. "No matter where you live in British Columbia, forests are part of your life," said Forests Minister Michael de Jong. "Over a quarter million people depend on forestry directly or indirectly for their livelihoods; and all of us rely on the education and health care services that our forest economy supports." To read the full press release, go to the Ministry of Forests website at www.for.gov.bc.ca.
Front Line Leadership from Catalyst Training Service Inc. BC Wood Associate Member, Catalyst Training Service Inc., is holding a two day program on Front Line Leadership on June 17 and 24, 2004 in Burnaby, BC. 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, download the registration form and the informational brochure.
Export Marketing Value-added Wood Products to the Western US The District of Squamish Economic Development is holding a seminar on Export Marketing Value-added Wood Products to the Western US. Jennifer Rose, Program Manager for the Western US at BC Wood, will be in attendance to discuss opportunities for BC wood products in the US Pacific Northwest.
Date: May 17th, 2004
Registration: Contact Angela Langford
Simon Fraser University Hardwood Research Project
The plant research laboratory at Simon Fraser University is conducting a
study on exploring the genetic diversity in hardwood trees, with a specific
focus on identifying and propagating novel naturally occurring hardwood
varieties with figured wood.
They are looking to BC industry, government and professional associations for assistance in locating trees with wood abnormalities (either in the form of burls or other more inconspicuous characteristics) so that they can collect as many figured wood samples as possible. If you are interested in helping, or require more information, please contact Lisa Lange at lmlange@sfu.ca.
To download the tentative 2004-2005, BC Wood trade event schedule, click here.
International Contemporary Furniture Fair
Carrefour International du Bois
American Institute of Architects Expo
PCBC 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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This is called the "Grill House" as it comes equipped with a BBQ
set in the center of the structure as well as a chimney to allow the smoke
to escape from the top. If the BBQ is removed, it can also be used as a
playroom or even a small cabin for sleeping. The retail price is Y980,000
(C$12,250). Its dimensions are 3.2m L, 3.2m W, and 4m H.
This shed is made to look like a machine cut log house. It retails for
Y298,000 (C$3,725) and is 2.4m by 2.8m including the porch. The overhanging
roof and little porch give it a more stylish appearance than a simple shed.
Larger versions of this can be found in resort areas being used as gift shops
and food stands.
Without a porch, this version has a lot more interior floor despite having
a smaller footprint (2.5m x 2.2m). However, the window gives it more of a
real log house look. Its retail price is Y368,000 (C$4,600).
On Saturday, April 24th, the Tochigi Prefecture Judo Association held a
grand opening ceremony for their new office building. Various dignitaries,
including both local and national politicians, attended the gala event to
celebrate the opening of this wood framed commercial building made from
Vancouver Island Douglas Fir.
Prior to the opening ceremony, I toured the new facility together with BC
Wood’s Canada Wood partners, as well as Mackenzie Clugston (Minister and
Deputy Head of Mission) and Matt Fraser (Second Secretary, Commercial) from
the Canadian Embassy. As a part of the official program, Mr. Clugston gave a
speech congratulating the various parties involved in this project. David
Litchfield of COFI presented the Chairman of the Judo Association with a
plaque, on behalf of Canada Wood, to thank the association for using Canadian
building products.
| May 5, 2004 | Volume 3, Edition 23 |
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| Copyright 2004. BC Wood, All Rights Reserved. | |
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