OPERANNG OPPORTUNITIES

WALLY LYNCH Paid Associates PO. Box 741623 Dallas. Tx.75243

I T USED to be the sticks you bought ! became more valuable the longer you had them in your inventory.

Maybe that will be true again someday, but it's doubtful. It will always be hard to make money with unsold lumber, no matter when you have it.

A carload of cedar that will fill de-

Hardwood Shortages

(Continued from page 9) non-use ofour forest resources," he said.

The Appalachian association lists the education of the public, legislators and consumers about the resource, how much exists, who owns it, and what management techniques best insure its continued health and welfare as its most important task.

The issue of the red-cockaded woodpecker appears to have minimal impact on hardwood timber production and supply at present, according to Elizabeth M. Pease, director of communications at the National Hardwood Lumber Association in Memphis, Tn. She explains this bird does not nest in hardwood trees and most of the land in the southeast is privately held. However, she qualifies her statement by adding that if the woodpecker were to be listed as an endangered species there could conceivably be a problem for the hardwood industry. In order to maintain nests, which require pine cover, many hardwood trees would have to be eliminated, thus upsetting the natural ecology of the forest.

The latest Resources Planning Act Assessment projects domestic hardwood sawtimber consumption growing over a third by 2030 with total consumption of hardwoods increasing nearly two-thirds. Hardwood lumber prices are projected to mand for the next three years is a profit disaster regardless of its value appreciation. Being a big buyer without big sales is nuts, whether you own the wood outright or not. Inventory is a problem when you don't have it and a profit destroyer when you have too much.

There are numerous examples of inventory concern turned to action.

Honda Motors in Japan is supposedly now turning its inventory 150 times a year. They take inventory during every shift, ask for and get deliveries of raw materials l0 to l2 times daily. rise at an average annual rate (net of inflation) of just over l0lo per year. The increases will probably be largest for high quality sawtimber of preferred species and products made from this timber. Hardwood inventories will continue to grow in the north, the report says, but are projected to gradually decline in the south after the year 2000 due to maturing of stands and shifts to softwood types. lgnoring a cause never cured a lault. A nonexistent, inept, or unimplemented plan never managed or reduced inventories.

A major chain in this country asks for (and gets within l% of its unit orders) delivery of mattresses within 30 working hours of order placement with 90 day dating.

A dinette manufacturer produces 10,000 SKU's and turns its inventory l0 times a year.

The growth experienced by structured wholesalers for the past several years indicates the same awareness on the part of many building materials dealers.

You can't sell anything for more than a customer will give you lor it. lt doesn't matter how much you have in stock or what you perceive its value to be.

Any idiot can buy, but it takes a merchant to sell. Inventory problems don't occur with the products and items that are counted and evaluated each week, or at other review periods, but with the stuffthat you don't need. We all know the culprits. The ptan to sell never existed, didn't work, or was not triggered.

In an effort to use smalldiameter, low quality hardwoods, research has developed waferboard. This uses smaller diameter trees as well as soft hardwoods such as aspen. Lab research studies show that wood composites combining wood fibers with plastic mesh have potential application in products such as kitchen cabinets, Joslin pointed out. This combination produces a material that can be molded. It is considered strong and resistant to dents and adverse effects of cleaning fluids. Other studies indicate that lower grades of hardwood lumber can be used successfully in kitchen cabinet manufacturing.

In summary, it appears that hardwood is plentiful although spot shortages may appear due to weather restricting cutting or unusually high demand for certain species. Education of the public and utilization of lower quality species will help to keep supplies plentiful in the years to come.

Some of us go off to trade shows without our computers and ask what's new instead of what sells. Then we buy what we think we remember we need instead of what the customers tell us they want. Everyone has special order goods as old as the company.

Nineteen hammers, six deep, is another "no gooder" everyone has. The point is that when what we have doesn't move, we aren't geared to get it out of the system. We ignore it and re-order what sells until we choke on what customers don't take from us.

If you buy the theory that 2006 of your items do 80% ofyour business, and you should, then recognize something. Your problems are going to be with 8006 of your items.

N.G. Building Code Ghanges

Effective June l, 1990, all treated wood products sold in North Carolina will have to be dried to 1906 or below moisture content.

The proposal adopted by the North Carolina Building Code Council in early September also specifies that indelible ink quality marking stamps for treated lumber must be placed at least two feet from either end of the piece. Plastic and metal tags or similar labels are not acceptable.