Foreign panel markets growing

THE PAST year has been one of I the most successful ever for the American Plywood Association international marketing program. Total U.S. panel exports in 19g6 reached 600 million square feet,3/ 8" basis, an 86oh increase over r 985.

In the long-established primary market of Europe, four factors have contributed to the improvement, according to Tom lrast, director of APA's international operations.

(1) The decreased value of the dollar, which made U.S. structural panels more affordable;

(2) A better economic climate in Europe, which encouraged trade;

(3) The fact that the Canadians were not as active in Europe due to strong domestic demand, and strikes affecting many mills;

(4) The effect of APA promo- tion, which maintained hieh visibility for U.S. structural panelj

Europe registers over 2 million housing starts each year. But much of the construction is of masonrv. The more rewarding immediaie markets for structural panels are export packaging and concrete forming. APA field representatives in Europe, therefore, give much of their time to the industrial and shuttering (concrete form) markets. while also continuing to work for expanded housing opportunities on a long-range basis.

APA's European headquarters is in London, where Raymond C. Mitzner, P.E., directs operations in the U.K. and on the Continent. Other European offices are in Antwerp, Belgium, and Hamburg, West Germany.

"One of the key trends in the British market is the steady growth of the home repair and remodeling sec- tor," Fast reports. "Do-it-yourselfers now consume about one- quarter of allpanels imported. Commercial construction also shows strong potential as it is projected to increase 13% by 1990. However, the fastest growing market is industrial, predicted to increase I706 in the same period."

Story at a Glance

U.S. panel exports reach 600 million sq.ft.. European economic climate encourages more trade. high Potential for increased exPorts. APA bears down on Promotion.

On the Continent, Denmark, with 50% of today's housing alreadY in timber frame, is one of the few European countries where residential construction currently is a significant market for APA products. Traditionally, a high percentage of the imported structural Panels come from the U.S. But aggressive sales efforts by competitors beyond North

America have made an imPact. "Three factors will determine the tJ.S. ability to maintain market position," I'-ast said, "the dollar exchange rate; action bY imPort trade organizations; and most importantly, continued strong APA Promotion."

In Holland, where the U.S. has a predominant share of North American panel business, the climate is right for continued market growth, according to Fast. Industrial applications are the largest market opportunity, but residential contruction also holds promise. Although Holland's total housing starts are decreasing, wood housing can gain significantly from government subsidies for timber frame construction and from the constant search for more energy-efficient building methods.

Shipping is a big industrY in Belgium. Over half of the imported plywood goes to materials handling and transportation applications. "With projected growth in materials handling. we feel we can increase panel exports to Belgium modestlY but steadily," I'-ast said. "with a 500/o share of North

American panel exPorts in 1986, there is plently of room for growth in the German market," Fast exP/Continuetl on ttext Page)

(Continued from previous page) lained. Approximately half of the business currently is in the industrial sector. Applications with the strongest opportunities are truck liners and plywood pallets. German residential and commercial construction markets are expected to make a larger contribution as knowledge and acceptance of U.S products and systems increase.

The ltalian market for panel products is primarily industrial, especially in materials handling applications. APA promotion of the new 1100 liter bin, popularly known as the "Big Bin," has led to ltalian use of the bin for storage of wine and tomato paste. With continued promotion, the prospects for greater U.S. penetration of the ltalian market are encouraging.

Looking beyond Europe, F'ast noted that 1986 was also a noteworthy year for panel promotion in the Pacific Basin and Caribbean. APA extended its direct representation to Japan and the Dominican Republic.

In the past year the association has completed demonstration houses in China, Japan, Ecuador, Chile, Guatemala, and El Salvador.

These new units, which bring the total number of wood demonstration units to 59 worldwide, are part of a long-range effort to replace traditional nonwood materials and methods with more cost-effective U.S. wood housing systems,

In Japan, the highly successful 1986 Summit House demonstration project required a special waiver from the nation's Ministry of Construction to exceed current Japanese code height limits for wood buildings. To obtain the waiver, the threestory house in Tokyo had to demonstrate resistance to fire, earthquakes and severe winds. "As a result of the construction of Summit House. the Japanese have eased code restrictions on three-story wood buildings," Fast said.

Since it was dedicated in May of last year, the house has attracted more than 23,000 visitors. In addition, nearly 2,500 Japanese builders and architects have to date attended the continuing series of seminars sponsored by APA and the Western Wood Products Association.

"To sum up, " F'ast said, "whether the promotional activity is in Europe, the Caribbean, or the Pacific Basin, APA's pattern of research and action is the same. Before initiating any promotional activity, we evalute the potential market thoroughly. We consider each nation's housing needs, tariff barriers, code restrictions, and local construction methods and traditions. Next, we develop a strategy to capitalize on both the immediate and long-term targets of opportunity. Frequently this means efforts to reduce tarilfs and break nontariff barriers and to beat down code restrictions. "

APA works closely with designers, code oflicials and members of the distribution trade. In developing countries, they've found that demonstration units, combined with seminars, are a geod way to present wood construction systems to local builders and code oflicials.

In all cases, follow-up is critical. Bringing about change in public perceptions, removing code blocks and trade restrictions, and countering long-established construction tradi: tions are tasks requiring constant attention over an extended period of time.

"Yet progressive change can take

(Please turn to page 75)

Lumber One Shuts Doors

Lumber One, a $25 million home improvement chain, San Diego' Ca., has closed its five stores as the first step of its planned reorganization under Chapter 1 I bankruptcy protection.

Operator Cole Industries, Inc., National City, Ca., filed the petition to reorganize under shelter from creditori, reporting assets of $2.8 million and liabilities of $4.2 million.

Solana Beach general manager Bill Evans said he hoPed the stores in Solana Beach, National CitY, Fallbrook, Temecula and Ramona, Ca., closed by cash-flow Problems and the "whole industrY being in a transition mode," would reoPen in three weeks.

More Lumber Sent East

The West's four toP lumber Producing states all shipped an increasing share of lumber to the ninestate Northeast region last Year, according to the Western Wood Products Association.

Oregon increased shiPments to the Northeast from 3.840h of their 1985 toral to 4.'750/o in 1986, while that sent to California fell from 34.30/o to 33.101r. Some 2l.5oh remained in the state.

Washington's shiPments to the Northeast rose to 6.30h last Year from 4.940h, with 19.101r retained' 75.7401t to California and 8.2601r to Oregon.

California shiPPed 2.6% of its lumber in 1986 to the Northeast, uP from 1 .240hin 1985, as 6-5.401r stayed in the state, down from 6'l .1olt in r 985.

Good '87 For Home Centers

Home centers are among the durable goods retailers forecast to experience relatively high year-overyear growth rates during the first half of 1987.

Despite the exPectations of most analysts ". people didn't rush out late last year to buy all of their big ticket durable goods before the end of sales tax deductibility. Apparently, consumers are more aware than most economists that only a few items such as automobiles offer automatic sales tax deductibility. So' without this much discussed incentive, consumers will extend such purchases out over a longer Rerig-d, making the earlY months of 1987 attractive growth prospects for such merchandise," says James Newton, president of Economic Perspectives, Inc.

Managers BuY Sequoia SUPPIY

The Sequoia SuPPIY division of Wickes Cos., Inc. has been sold to a new company created bY the management of that division.

Paul Hylbert, President of Sequoia SupPlY for the Past two years, is president and chief executive oll]cer of the new company'

Vice presidents are Dick Passaglia, marketing; Hal Huff, western regional mgr.; TerrY Kohnke, northern regional mgr.; Hal Holden, southern regional mgr., and GarY Joslin, chief financial oflicer, administration and finance. All of the present Sequoia management staff continue in the new company.

Headquartered in lrvine, Ca., Sequoia Supply is one of the nation's largest wholesale distributors of lumber and building materials. Founded in 1948. it was acquired by Wickes in 1975. Included in the sale are all of Sequoia Supply's assets, including its 33 distribution centers in 23 states.

"sequoia SuPPIY is an excellent company, but as a wholesaler it does not fit our strategic Position as a major retailer of building materials," said Sanford C. Sigoloff, ceo of Wickes. "The sale will allow us to redeploy assets in accordance with our primary direction'"

Hylbert noted, "As an indePendent wholesaler distributor, we are excited about the prospect of being of greater service to our customer base."

All senior members of the management grouP of Sequoia SUPPIY will be stockholders of the new company.

Laminated Panel Trade Name

Permalam has been selected bY the American Laminators Association as the new industry trade name for thermoset decorative Panels meeting the association's performance standard ALA 1985.

The new trade name will make it easier for specifiers to refer to the product and the standard, previously -kno*n as Thermoset Decorative Composite Panels.

1986 Housing Totals

The final figures for new housing starts in 1986 totaled 1,808,960, up slightly from 1985's 1,808,198 units.

Los Angeles/Long Beach led the nation for the second consecutive year with 69,990 new housing units. This total represents a 2901t increase over 1985's level. Washington, D.C. ranked second with 52,120 units, up 210/o over the previous year's level, according to F.W. Dodge Co.

Other top l0 housing areas: Atlanta, Ga., -51,330 units, up golr; Riverside/San Bernardino, Ca., 49,050 units, up 32olr; Phoenix, Az., 42,8'19 units, down l7%r;San Diego, Ca., 37,611 units, down 40h.. Chicago, ll., 31,874 units, up 460lr; Tampa/St. Petersburg/Clearwater, t'I., 30,947 units, down l20lr: Dallas. Tx., 30,781 units, down 3-5olr; and Minneapolis/St. Paul, Mn., 26,887 units, up 90[.

In the fourth quarter 1986, the top l0 housing areas were: Los Angeles/Long Beach, 1,5,879 units, up 1-506; Washington, D.C., 11,9-51 units, up l2olo; Riverside/San Bernardino, I 1,128 units, down 606; Atlanta, 9,843 units, down 160[l San

Diego, 8,786 units, down l6oh.. Chicago.8,227 unirs, up 22olt., Phoenix, 7,339 units, down 33%: Minneapolis/St. Paul, 7,126 units, down 7oi; Detroit, Mi., 7,0,56 units. up 5001,1 and Anaheim/Santa Ana. Ca., -5,923 units, up l3%.

K mart Exec On Retailing

"A retail business is a unique business in that it is constantly able to renew itself. Retail businesses generally don't die because all their customers move away. They die because the customer loses interest in them."

Continuing this thought, Bernard M. Fauber, chairman and ceo of K mart Corp., parent of Builders Square, said recently, "Customers lose interest because they are no longer being satisfied. And, by satisfaction, we mean principally that the products, service and physical environment no longer fulfill the customer's demands."

In another part of his talk on the occasion of K mart Corp. being honored by the Newcomen Society

The Merchant Magazlne of the United States, Fauber called Builders Square the largest warehouse home improvement retailer in the country and explained that K mart had broadened its retail operations to include it because "many of our key product classifications have growth potential well beyond what can be satisfied inside K mart."

The Newcomen Society, an organization whose name perpetuates the life and work of Thomas Newcomen, a British pioneer in the field of steam engines, holds meetings throughout the U.S. and Canada to honor leaders in various frelds.

California Housing Strong

The California housing industry is forecast to have another strong year based on continued demand for housing caused by falling mortgage rates, according to the Bank of America.

In 1986, housing starts rose l2olo to 270,896 units, and construction of new single family homes ;umped 16.70/o to 130.020.

Colihrnio Pre-Sloin

6980 (heng Avenve, Lonq Beoch, Colifornio 908O5 l2r?l 602-2405

FIRE RETARTI \NTS

A Must For. Hotels. Hospitols, Schools, Government lnstitutions. Rreos of Public Flssemblg, Restqurqnts' Theoters, Night Clubs, Storos. Hozordous Industriol Flreos in Mines, Foctories 6r tlJorehouses'

Fira-Iact tlJT-'I09 - ff Closs Fl Product lnturnescent Lot@x Point (lcBO #3636, Stote Fit@ Morsholl #C-100, LF Citg Fpprovol #94303)

Fire-Toct LIJT-l0l - R Closs B Product lntumesc€nt Oil Bose Point 0CBO #3656, Stote Fire Morsholl #C-100-1, LA (itg BPProvol #94303)

New Bay Area Reload Open

[:ncouraged by lhe sllccess of its cargo rcload lacilirl in ('rockett. Ca.. illrcl the strong ecollollv ol the San I;rancisco area. [)opc & 'l'albot. Inc. hus nroved to il lte\\. larger relcxrcl laciliti' at the [)ort of'Ileclriood Citl. ( lr Tlrc ( roekett (,I)cr'rli{,n }r.rs hcrirr closcd.

"l)cntand for our luntber in thc IJur .\rea has ntct or crcccdecl all of' il)lttt.tt !ttr)t i, l)Ltt:t'i/))

IN0USTBY representattves on hand for |te openrng o1 the Popc & Talbot reload fac I ty at tfe Port of Redwood 0ity, Ca: ll) Dav cl Cassella Suzy Clayton. Terry Saunders {2) .lohn Sweet Reed TrLt Charlie Noble (31 ilapt Joh n Nc Ne I llett Horsman. Jinr

I aber, Pau Sause (4) Greg Passmore. John Parsons [5) Cl ff 0 Nei John B ssett (6) Flli0t Wilson, Bob []ochrane, Mike Royers Guy l averty (7) Bill Freedland, Dan Harper {8i ilolvard & Gloria GraLrlich {9} Art parker Denn s Byerie Glenn Miller Il0l Al Gedroez Flob [,]ues ll l) Fred DrP etro, Michael Flann ery ll2l ft,lorr e T sda (13) A White (l4l Dick Canreron I I 5l Jack Lawrentz. BLrd Bri stow south Bay Forest Products, a very special manufacturer of specialty lumber products, has a winning combination for you. manulacturer specializing in western specialty softwoods