Wholesaler planning

I T HAS been especially true of I the leading wholesalers in the lumber and building materials business over the years that the best of the lot were in the vanguard in adopting better management techniques and methods to retain their positions of leadership.

As wholesaling moves on toward the ever changing business world of the 1980s, Inland Lumber Co. of Colton, Ca., one of the largest independent lumber wholesalers in the country, has again been in the forefront in adopting new management structures and attitudes.

In the past year or so management has been making a series of evolutionary changes to fine tune the company to present and future business conditions.

Not surprisingly, given its success- ful track record, Inland Lumber is taking full advantage of the housing boom with a considerable increase in sales and yet is doing it with less people. It has pared a third of its people from the Colton yard alone to illustrate their improved efficiencies.

These changes are very much by design, rather than in reaction to any passing market condition. Planning is taken seriously and acted upon.

Founded in 1946 by Fred Thomson, the company now has distribution yards in Colton (45 acres) and Tustin (5 acres) in Southern California and Woodland ( l5 acres) in Northern California. Trading offices are situated at Colton, Tustin, Arcadia and Fremont in California and at Portland and Tillamook in Oregon.

Actively involved in company planning in addition to Fred Thomson, chairman of the board, is his son Gary, president, vice presidents Ted Russell and John Boyer and controller Bob Brown.

The growth the firm has experienced the past year is the direct result of

Inland's planning, according to Gary Thomson, "It's controlled growth, not unexpected and is just about on target for the goals we set for ourselves a year ago."

The yearly projection put together by the planning group is reviewed monthly as to the current status both of the financial and the operating plan. "We look at costs for each department and try to match, as nearly as is reasonably possible, the levels our program has established. We want to grow for a purpose, not for growth's sake alone."

Story at a Glance

Large wholesaler is making changes to cope with the ever shifting business world use of computers and advance planning . what they see in the next five years.

Despite the stress on numbers that such planning inevitably involves, Inland is very much people oriented. Like all aggressive companies, they want the best people they can find. "Good solid people who have proven capabilities. If they are young, fine, notes Gary Thomson, "but ability outweights youth any day."

A review of their trading staff quickly bears this out: ages range from the late twenties to 73. the senior member being George Clough of their Arcadia, Ca., office who brought his 56 years of experience to Inland a year and one-half ago.

excellent lumber traders from other wholesalers.

Considerable attention has been given by Inland to backing up its sales force with the business tools necessary to increase productivity. The addition of distribution yards was a calculated move toward having their trading offices backed up by distribution yards with the physical inventory ready to serve the customers.

A new computer system is being installed at the Colton headouarters to manage all the numbers generated by their expanding operation. It is the Microdata "Reality System", an interactive online type computer that can tie in with existing systems and is capable of receiving input from many stations continuously through a standard CRT keyboard unit.

As they have added yards, people, equipment and the inventory to go with them, the cost of running the business has increased commensurately. Management of all the numbers, and especially the dollars, has received increased attention.

"We have to manage our inventory for tighter control of our money," observes Gary Thomson. "Tougher competition between all of us at the wholesale level makes it inevitable. The cost of money means the retailer simply can't afford to tie up as much operating capital as before in maintaining inventory, so more inventory will have to be carried by the wholesaler. That means that inventory control will be even more critical to assure the customer satisfactionl'

People and money are the key elements in the business, notes Thomson. "lt's a numbers business, trading money, moving money with people," remarks the 35-year old who adds with commendable modesty, "l reahze I wouldn't be where I am without being the son of the boss, but I reallv enjoy what I am doing andamthankful for the opportunity Dad hasgiven me."

Inland Lumber's planning for the future has resulted in some interesting guestimates as to the biggest changes ahead in the next five years for the company and the industry.

The firm expects to be more of a multiple yard operation, small 4-6 man trading offices backed by regional distribution and re-manufacturing yards. Like other wholesalers, it expects to be doing a more efficient job of handling its inventories and managing the capital needed to operate.

Lumber and building material mass merchandisers will increase in number and share of the market; more and more modules will be used in building as on-site costs rise; less rail shipment East; Western woods will stay in the West, though some Southern yellow pine will invade the Western market; the influx of Canadian lumber will increase as their log costs are lower than most domestic producers.

The company has its own training program, but as it has grown rapidly, it has inevitably had to attract trained people from the major corporations. Additionally, it has brought in some ( Please turn to page 46 )

Other opinions on the future envision strategically located distri-

COMING & G0ING (1) new LMA pres. Bill 0berholser and immediate past pres. Bud Spencer. (2) Len Viale, Herb Eaton, Pat Viale. (3) Ralph Lamon, The Merchant Magazine's Dave Cutler, Pete Middlekauff.

(4) Maurine and Bob Babicky. (5) Bill Stevens, Bud Robey. (6) Bill Niesen, Nifty Gay, Bernie and Elaine Barber, Betty Gay. (7) Les and Jeane Ley. (8) Barbara and John Polach. (9) Lyle Shafer, Bud Spencer, Jean