It's hardwood quality, not price, that sells

lly Doughs R. Bolton (ieneral Manager Weyerhaeuser ChoiceWood

OI)A\''S rctailers ilre torn betwccn I corporate strategies and consumer wants. While giant retailers are waging a price war, their consumers are seeking more quality lor their dollar. In other words, a better value not just the lowest price. Nowhere is this more true than in the hardwood do-it-yourself retail board and moulding market.

ln a study made in 1987 by Virginia Polytechnic lnstitute and State [Jniversity, Blackburg, Va., the retail hardwood market was predicted to grow l44tYt over five years. Actual experience is showing this number to be conservative. Red oak is the leading species, lollowed by yellow poplar, hard maple and mahogany. Weyerhaeuser's hardwood sales are 42tt/r red oak, 28(h poplar, l2(l, hard maple. 101l, mahogany,8(Xr cherry, ash, alder, walnut. A major conclusion of the research study was that consumers purchase hardwood based on quality rather than price. although this has not been the nature ol the sales effort throughout the years.

The retail market for hardwood has gone through a major evolution over the past several years. At first, random width. random length lumber was purchased in truckload quantities. This lumber, hardly ever advertised, was stored in the back of an outside lumber shed. The hardwood was graded by National llardwood Lumber Association (NllLA) rules, which were designed in 1897 by hardwood producers. The cutting rule method certainly was not designed with the retail customer in mind. In an attempt to increase sales and make it easier to stock hardwoods. the retailers switched to a series ol fixed width, random length boards. lf there were l0 boards of the same size displayed, the consumer would look at all l0 and purchase the best one. Through this process all of the delect boards, or just ugly ones, would remain in the rack. Suddenly all the boards on display were of poor quality. At point, many retailers discontinued hardwoods due to quality image. They simply were trying to buy price and sell quality. The consumer went elsewhere.

The grade was still a product of NIILA rules. Split, cup, warp, sidebend, honeycomb, mineral, moisture problems and poor surfacing were allowable because the consumer would simply cut around them. The retailers were narrowly defining their market to consumers who owned sophisticated woodworking equipment. F'urthermore, they assumed the woodworker found enjoyment working around these defects rather than creating their projects. The savvy woodworker was realizing that the lowest priced hardwood board wasn't such a great value when he threw hallof it away, couldn't get the cuts he needed, used tons ofsandpaper or had his "work of art" split or warp after completion.

Some retailers decided to upgradebut to what? The concept of "clear one face" fixed width hardwood came into play. At the same time retailers moved the boards out of the shed and leaned them up against a wall in the back ofthe store. Soon they found a tangled mess of boards because consumers were very selective when purchasing hardwood.

In 1984 a small company in Titusville. Pa.. called Redi-To-Use Hardwoods had a radical idea. Sell retailers a defect lree piece ol hardwood. They provided a free hardwood merchandiser along with point of purchase literature for the consumer. The store didn't have to hold inventory in the back, since they could buy exactly what they needed by the piece, not truckload. Delivery was direct to the store, freeing up distribution center space and middleman markups.

Story at a Glance

How and why the sales of hardwood boards have changed over the years. .d-Fy customers react positively to a higher priced and higher quality hardwood product.

The merchandiser was attractive and shopable. The hardwood had gone from the back of an outside shed to the front of the store displaying a quality image in retailing. An interesting phenomenon occurred. Retail sales skyrocketed even with high retail price and more important high retailer margins. The stores found that hardwood could be an impulse purchase. Not only that, but the hardwood project purchase was accompanied by tools, stains, brushes, sandpaper, bits, lasteners, etc.

The list of retailers stocking the clear hardwood program is impressive. Builders Square, Home Depot, Lowe's, Channel, Grossman's and Home Quarters, to name just a few. Along with these major chains, thousands of independents sell the product.

Of course not everyone has learned the lesson from this evolutionary history. Many cling to substandard products at low invoice prices.

Retailers stocking the clear hardwood don't mind their competition's attitude. The clear product is selling at three to four times higher volume with great margins. And at their stores, the consumer is king.