Two practitioners of the art of lumber buying

Being a fond reminiscence of two lively figures in the lumber fraternity of three decades ago.

By Stephen G. Freeman Stephen G. Freeman & Co. Newport Beach, Ca.

lrHE COZY cottage-like building

I setting apart from the rest of the bustling lumber yard, with its swivelfrom-the-wall bar, was the hallmark and office of Frode Kilstofte, president and major shareholder of Rossman Mill & Lumber Company in those halcyon days of the '50s. Company headquarters were at their Wilmington (Los Angeles, Ca.) yard.

The skillful buying and selling of lumber is, indeed, an art and the successful are truly artists. Here, veteran lumberman Freeman remembers two of the best from those very different business dsys of the '50s and '60s.-ed.

Calling on him was, judiciously, the last call of the day, it being an event, with Frode its hearty, effusive host. You joined him in a drink or so as well as lively conversation not related remotely to lumber-which, in terms of this publication, would register "R" if not "X" rating. He maintained too a lower desk drawer of "photo-art."

After a sufficient romp Frode would come to the business at hand. Despite his many outside activitiesvarious boards, service clubs, philanthropies-he was eminently aware of current market conditions and activity. He knew precisely what he wanted, bought decisively, well, and in quantity.

Then suddenly he died.

And a true figure was gone.

Frank Hill, a minority shareholder and general manager, took over operating from their Cherry Avenue location. (Apparently Frode's cottage-office would be a shrine). Though Frank's modus operandi was totally unlike that of Frode, he was one of the best, most astute lumber buyers of all time.

Frank was a quiet, gracious man, yet warm with humor. Nothing hurlyburly with him; time was forever. He enjoyed listening, whether in person or over a phone. A cardinal tenet became apparent: one never asked Frank "What do you need?" His answer, always cool, calm, and with the ring of utmost sincerity, would be, "Oh, nothing. Really nothing at all. Our inventory is too heavy.,'

Yet in his subtle fashion, which even today I cannot reproduce, he had you go through your entire reper- toire of offerings. Listening courteously, silently (sometimes on the phone you felt perhaps he was no longer there) you would ultimately highlight certain items simply to evoke a response. At such times he would comment but noncommittingly.

On running through the entire roster of offerings and having received not even a flickering of interest, usually you paused, rather wearied. Frank might then say, ,,you mentioned studs, (perhaps one of the first items you had offered) what was the price again?" (You hadn't mentioned price). "And whose studs are they?" You stated the price and (to recreate an actual case) advised "They're Mendo studs." Mendo Studs was a large producer based on the old Ridgewood Ranch, near the California towns of Willits and Ukiah. It operated between 1957-1966 and was owned by the Welch brothers. It shipped truck and trailer only. The firm was not connected with the present Mendo Mill & Lumber Co., which is primarily a retail frm and is based in Ukiah.

"Well, I might be able to use some," Frank might say languidly, the implication being he might give you a token order, a gesture of graciousness for your time and effort. "But the price is a bit steep."

We'd work on that, and gently, in his charming manner, somehow he brought you to his figure.

"How many loads are you offering?" he'd ask.

"Oh, no specific number," you,d say. "As you know, Mendo is a large mill and with time they can handle good quantities." A silence would ensue before Frank would speak.

"Well, I guess we might use, say, 30 loads or so." And that was your order...but, of course, Frank Hill "never needed anything. "

Frank became very ill and was hospitalized. He wished to maintain contact and welcomed phone calls. And after awhile you knew it wouldn't be long. In light conversation I joked that we'd route the Mendo trucks with their studs by the hospital having them give a special toot on their horns in salute. He laughed...and that was our last conversation.

The three facilities of Rossman Mill and Lumber were sold in 1967 to the Ward and Harington Lumber Co.

After several interim owners, the properties were purchased by LouisianaPacific, which in turn eventually disposed of them for purposes outside the lumber industry.

Tool Maker's Copycat Lawsuit

SK Hand Tool Corp., a manufacturer of quality hand tools, has filed a lawsuit seeking an injunction and damages against three distributors of hand tools for "marketing inferior quality hand tools with SK look-alike packaging and copycat advertising," according to SK.

The lawsuit requests a preliminary injunction order against Central Purchasing Inc., North Hollywood, Ca., Harbor Freight Salvage Co., Camarillo, Ca., and B&B Automotive Tool Warehouse Inc., Bensenville, Il.

The suit describes Central Purchasing as an importer, distributor and marketer of hand tools; Harbor Freight as a warehouse distribution center for hand tool products and an affiliate of Central Purchasing; and B&B as a distributor and marketer of hand tools at wholesale.

The lawsuit alleges that the three defendants have used packaging, etc. which "copy every significant detail of the SK trade dress, including label layout, background colors, illustrations, type style, label format and container color'"

Further, the suit alleges, B&B distributed a circular advertisement entitled "The Twin Look to SK" which uses pictures and descriptions of SK's hand tools photocopied from pages of SK's own catalog.

"Use of these pictures of SK's hand tools in B&B's advertising is false because the pictured hand tools are not B&B's hand tools and B&B's hand tools are not replications of SK hand tools, and are of inferior quality," the suit states.

The lawsuit seeks redress on 12 counts including permanently enjoining the defendents from using the trade packaging and requiring them to turn all such material over to SK for destruction, to advertise to correct "misleading impressions" conveyed by previous advertising and to pay numerous damages plus court costs.

Thomas M. Corcoran, SK chairman and ceo, said, among other things, "Unless defendants' use is prevented, SK will lose sales and profits in amounts which will be very substantial. In addition, the good will which SK has obtained as a result of its investment in its distinctive trade dress for over half a century will be lost to it and diverted to defendants." He also stated that consumers place great reliance on a manufacturer's reputation in choosing hand tools.

Wholesaler Performance High

Small to medium-sized wholesalers in the midwest and south are outperforming their counterparts in the west, southwest and east in revenue growth, according to a two-year search study conducted by Geneva Corp.

The study, called the Geneva Index, is reportedly the first verified index of revenue, profit and owner compensation figures of small to medium-sized privately-owned businesses.

Findings involve a group of 500 merger and acquisition candidates, firms that are involved in service, manufacturing and wholesaling. Such firms range in size from $500,000 to $20-million and are located in 43 states. To fill in the performance picture, each company's financial returns as well as business evaluations by Geneva were studied. Then the financial statements, including balance sheets and income statements, were restated to more accurately represent the true earning power of a company.

By and large, performance of small to medium-sized wholesalers across the nation remained mixed. Such enterprises were larger in terms of average revenues, recording some $4.7-million versus a national average of $4.1-million. That figure was the highest of all three sectors. So was the relationship of revenues per employee at $180,580an indication of employee productivity.

On the other hand, growth by small to medium-sized wholesalers lagged. Average annual revenue growth was held to 8.390 as compared to both a national average of 12.6s/o and a service firm level of 22.70/0.

Regionally, midwestern and western wholesalers were star performers, substantially outperforming their national counterparts. Average annual revenue growth rates of ll.4t/o and ll,3o/0, respectively, pushed them well above the national 8.390 average.

When it came to owner compensation, the findings show, wholesalers fared poorest of the lot. Such enterprises drew markedly lower levels than either manufacturers or service firms. This held true for total compensation, $109,000; indirect compensation, $21,000; or as a percentage of revenues, 2.390.

Compared nationally, eastern wholesalers are drawing the highest amount of total compensation, $12,0(n, while midwestern wholesalers draw the highest direct salary, $105,000.