Real walnut paneling for $1.8O per year

by Greg Frumkin GF Co. Santa Monica. Ca.

T HE TOTAL home improvement.

I mobile home, and r.v.i. paneling market in the United States is about 4,000,000,000 square feet per annum.

That's about 125,000,000 4x 8 panels which, if laid end on end, would be nearly 190,000 miles, or more than 7-ll2 times around the equator. Why all these fancy figures? Only to demonstrate the size of the market for a hartlwood plywood product.

Approximately 8U85% of this market on a hardwood plywood base is heavily concentrated in lauan plywood. In fact, it can be claimed that lauan plywood really started the home irnprovement paneling business, and was highJy instrumental in allowing the mobile home industry to grow so rapidly.

Lauan plywood wall paneling first entered the market with simply a clear lacquer face with v-grooves and became the dominant "leader panel" at all leading retailers.

As any market grows, it starts to sub-divide and become more sophisticated. The next step was to print, and so on to vinyl, paper overlay, embossing. Now just look at the variety of panels available in retail stores and the arnount of square footage that is devoted to this relatively high ticket item.

Today the scenery has changed. The "leader panels" are rnainly produced on sub-straits originating and manufactured in the United States . hardboard, mende board. thin particleboard, and the like. This has virtually wiped out the original natural lacquer finish that later become "Colortone".

However, the market has been growing and consequently the footage of lauan plywood has not been seriously reduced. Maintaining this footage has only been accomplished by sophistica- tion of product. Today, the scene is extremely sophisticated with gravure printing, very high fidelity paper overlay, vinyl, and increasing decorative embossing.

We are all in business for a profit; in a reasonably large industry this is brought about by bringing products of good quality at reasonable prices to the market place.

This whole paneling industry started for the rich. Hardwood faced plywood is the creme de la creme, and it seems that in our scramble to get a percentage of the very large market we are ignoring a sector which has all of the ingredients of success: competitive, beautiful. exclusive. and durable.

According to surveys made in the last two years, the fashion for paneling has become more sophisticated in the sense that few people today are paneling entire rooms. The tendency is towards one wall or a feature wall, or surrounding a fireplace and similar type installations.

This means that each sale of each installation has fewer panels, but there are more sales.

A low price panel today at the retail level is about $4 per panel. Therefore if the average sale is three panels, the sale at retail level is $12. At these lower prices. retailers are competing heavily with each other, so perhaps in the total sale there is 53 gross profit.

We nrove up to paper overlay, good print. etc. A Letail sale for tl.rree panels may be Sl4 with a somewhat higher nrargin. resulting in a retail sale profit ofperhaps 58 - 59.

Most horne improvernent paneling sales are for installations in existing houses, and a very large percentage go over existing walls. Consequently. relatively thin paneling is quite acceptable and easy installation (certainly thicker and maybe easier than wall paper).

Story at a Glance

Why a few minutes of extra selling time for high quality hardwood paneling can increase the retailer's gross profit per sale from $3-$18.

The most sought after wood in the United States American black walnut in all ol its glory, prefinished, v-grooved and well made can easily be sold at retail in lots of three panels at $42 with a gross profit to the retailer of around $ 18.

Paneling of any reasonable type of quality, particularly if it is hardwood plywood based, is good for a rninimum of l0 years. Therefore, for an extra $ 1.80 per year, a homeowner can have real American black walnut.

For a few minutes . . . literally, a few nrinutes of extra selling time, the retailer can considerably increase his gross profit. The custonrer who comes in to buy paneling for a wall probably won't conre back for the same wall for l0 years or more. Why let him get out of the store with a $3 gross profit when it could be $ l8 for perhaps three, four, or five minutes of extra sensible, genuine selling.

Other beautiful hardwood species are available. We chose walnut as our example because it is cornmercially about the most expensive of those panels with a relatively large demand.

Profit, not volume, is the objective. Why are we ignoring one of our country's economic cornerstones and why are we ignoring one of the world's rnost beautiful products, genuine hardwood faced wall paneling?

I I

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