Optimism Among Hardwood Distributors

Business should remain strong for West Coast hardwood distributors, in the U.S. anyway, according to the Pacific Coast Wholesale Hardwood Distributors Association.

Sectional reports were a highlight of PCWHDA s annual meeting April 25-28 at the Mauna Lani Bay Resort in Hawaii.

Rick Burrows, Plywood Tacoma Inc., Tacoma, Wa., reported a strong first quarter 1999 in Washington State, with a slight slowing due to local layoffs. "It looks like 1999 will be a year where sales will be up, but gross prof- its will be down," he said, citing justin-time inventory as a must to control costs. Honduras mahogany, maple and cherry were the hot woods for the moment.

In Oregon, business was good in 1998 and so far in 1999 and looks promising for 2000, according to Peter Hall, Lumber Products, Tualatin, Or. He advised value-added business to differentiate your company from the competition and was one of several presenters to note a paucity of good people for hire. Material in demand: maple, red birch and cherry.

Kelley Aura, Aura Hardwood

Lumber Inc., San Jose, Ca., noted a very strong market with excellent margins in Northern California. Mills, though, have been moving into the area to sell direct. Oak, maple, cherry and poplar were the woods of choice.

Business in Los Angeles improved 5-l5%o in 1997 to 1998 and continues to grow in 1999, said Joe Somerville, Somerville Lumber Corp., Hawthorne, Ca. High inventory levels are making for a competitive market, while mills have built up their order files, increasing costs. Direct mill sales are up, and the labor market remains extremely tight.

Following an excellent 1998 and into a good 1999, Jim Caldwell and Shirley Reel Caldwell, Reel Lumber Service, Anaheim, Ca., predict a slight slowdown for Orange County in 2000. Oak, poplar, maple and Honduras mahogany are in demand.

Farther south, Jim Frost, Frost Hardwoods, San Diego, Ca., said business locally has been excellent due to a strong economy. Still, prospective employees are difficult to find-with a zEo vacancy rate for local apartments-and prices are very competitive. Top sellers are maple, Honduras mahogany and cherry.

Business has been uo and down in Arizona due to an influx of new competition, noted Chip Spellman, Spellman Hardwoods, Phoenix, Az. "In 1998, there were five wholesale distributors, now there are nine," he said. "Everyone has had to become more aggressive. Sorting, color, widths and lengths has become the theme of the day. If you do not do it, your competition will to get the order." Red oak, knotty look, red birch, maple, cherry, and Honduras mahogany are most sought after. He forecasts that with more people relocating to Arizona, next year should also be strong.

Western Canada was the notable exception to an otherwise optimistic session. "Socialism has brought B.C to its knees," reported British Columbia lumberman Gordon Reimer. "Business is slow to dead. Profitability is just a word to dream of." Canadian currency, which he called "the northern peso," continues to reach new depths. Hard maple and cherry are the lumber and plywood species of choice in the local market.

PCWHDA will meet again April 30-May 3, 2000, at the Phoenician, Scottsdale, Az.

Marketing To Home Sellers

HomeBase, Inc., Irvine, Ca., has joined forces with a real estate agency to encourage home sellers to repair or upgrade their residences.

The marketing plan, being initially tested at San Diego County stores, provides home sellers with Bonus Dollars that can be redeemed at HomeBase locations. The amount of Bonus Dollars sellers receive is based on the selling price of each home.

Taylor Place Real Estate broker Catherine Taylor, who devised the program, says it's a win-win-win-win situation for the home seller, buyer, agency and store since it increases the value of the home.

"Many people who are thinking of selling know they could ask more for their home and appeal to a larger number of buyers if they made simple but needed improvements or repairs," Taylor says.

Suggested applications for the Bonus Dollars include improvements to enhance the home's marketability and as a gift/sales incentive to the home buver.

DOMESTIC SALES: Jerry Long, Michael Parrella, Lynn Bethurum. Janet Pimentel, Pete Ulloa, Bruce Keith. George Parden, Jim Taft.

INTERNATIONAL SALES: Nestor Pimentel. Oscar Portillo.