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Do we fqce o permqnent lumber ond plywood shortoge?

THE lumber and plywood trade associations, r among others, are kind enough to send us their weekly and monthly reports to their members.

For the last couple of months it has become increasingly clear that what most of us thought was a temporary shortage in lumber and plywood may well become permenent.

Let us quote from some recent newsletters:

(.1) American Plywooil Association, September 20, 1968. o'A long term housihg forecast by the National Association of Home Builders predicts that housing starts should double within l0 years from 1968's estimated 1,450,000 units. This is rather more optimistic than a recent plywood association projection of 2,500,000 starts by L978," o'Some retailers report losing customers because of tardy shipments. Field men working hard to keep record straight when complaints not justified, and to favorably resolve'beefs'.

(.21 Southern Pine Newslener, September, 1968. o'Field reports indioate problems in meeting growing demand for lumber. Inventories low or nonexistent at many mills. shipments sometimes two or three months behind orders. occasionai customer complaints about quality.

'oHowever, mill cooperation vitally needed. Producers urged to keep standards high and avoid undue lapses in shipping schedules. Future of Southern Pine depends on it.

'oWhile struggling to prevent loss of markets, field staff also continues to try to build them. Witness these developments: Million bf. SP from SPA member mills sold by New Jersey wholesaler in August, mostly to retailers and truss producers. Twenty truckloads ordered by Buffalo, N. Y. wholesaler who wants to double that if sources available."

(3) Ranilom. Lengths, September 20, 1968. "In the upward movement of prices on building materials from May, 1967, to May, 1968, lumber and plywood were high on the list of those making gains. According to the Bureau of Labor Statistics, the price index on all building materials rose 5.6 during the one year period. However, some of the gains realized by the wood products field went like this, all up: Selected softwoods 24.3, softwood plywood 2I.0, Douglas Fir 19.1, Southern Pine 13.9 and millwork 5.6. Cdmparable increases were made by asphalt rooling, up 14.5, window glass, up I3.9, and copper tubing, up 13.8; however, most of the other key building items including paint, building block, gypsum products, building brick and concrete products.rose in a range from 2.0 to 7.5.

"Index prices on all construction materials have moved up steadily except for a brief downward tilt in the early 1960s. Lumber and plywood prices did not share in this trend, slipping behind the other materials in the late I950s. Lumber, using Douglas Fir as an example, only recently began closing the gap. For plywood, the trend'has been almost entirely downward until this year: It would appear, then, that the dramatic jumps experienced by prices of wood products this past ye.qr hive, in a sense, been a long-awaited correction."

Thus we see in the near future (A) a vast increase in housing starts, with a consequent tremendous increase in dernand for lumber and building materials. (B) a current shortago of iupply of lumber which will certainly grow worse as all the Iactors regulating supply and demand are compounded. (C) a certain further increase in lumber prices which will undoubtedly bring this commodity on a par with, or exceed, averages of other building materials, with the significant exception of plywood.

Under present conditions it is difficult to conceive of any large increase in production within the forest based industries, cerLainly nowhere near enough to supply a I0O/o increase in housing starts in the next ten years.

One might also wonder where all the wood substitutes are going to come from. They are based on natural resources, all of which, we might add, are non-renewable.

What is the answer for the retail building materials dealer? Write us. We'd like to know where you think we are heading in the next ten years?

P$ff].| t'J]|OTESA[E

Cfft{I PAI'|Y

.TEA,\IED TO SERVE THE DE.AT,ERS NEEI)S SPECIALISTS ll{

REDWOOD

K/D or Green Lumber, Plywood, Split Products, Shingles and Shakes.

DOUGTAS FIR

K/D or Green Lumber, Special Cuttings and Speciality Plywood.

INSUTATING PRODUCTS

Ceiling, Roof Deck and Sheathing.

DISTRIBUTI(ll{ A1{D SERVICE CEI{TERS

ARCATA 707 1822-0371

Stan Eisner

Roger Oilar

Frank Stanger

George Thompson

GARDENA 2131321-9202

Perley Fisher, Mgr.

Stan Cochran

Lynn Layton

Ray McKendrick

SANTA CLARA 4081 296-0407

Leonard Viale, Mgr.

Ed Blunt

Bob Raymer

John Harmer, manager and part owner, Southland Lumber & Supply Co., Inglewood, Calif., feels that Southland owes its success to "expanding the range of mater' ials stocked and getting away from a lumber base." John also lets service, product knowledge and speed rate high on his list.

In the last l0 years, Southland's percent' age of contractor business has switched with industrial, bringing their profits from in' dustrial accounts to 50/o of the total. The industrial business carried Southland through the slump. Harmer noted that small contractor business has picked up in the last five months where previously their business decreased. Southland takes a loss on "anything tied directly to the do'ityourselfer," said Harmer; for example, turned spindles, filagree dividers, decorative type items and'cheap tools. Harmer mentioned that three do-it-yourself opera' tions located within a three block radius of Southland have folded.

Southland belongs to the Sentinel Hard' rvare Group, not a co-op, which gives a

Brother- sister team runs first clas

cash rebate. Harmer buys through "normal channels," wholesalers and Los Angeles jobbers. This flexibility gives him the unusual items and sood service his industrial ac-

Story qf q Glqnce

Dealer astutely turns his attention to nearby industrial accounts at Los Angeles' gigantic lnternational Airport. The only way to get and hold industrial accounts is thru service, he emphasizes.

counts want. "The only way we can compete is by service. If you do it on purchase price, you go down the tubes in this town. We have to back up very strongly what we sell. And it has to be handled in a hurry. If you take six weeks, the guy's on your back," Harmer said.

Harmer and his sister, Mrs. Leah Miller, president oI Southland. grossed over $/2 million last year, mixing 50al industrial' commercial accounts with 30% contractor htrsiness and,20/o retail. Southland is loca.

ted adjacent to Los Angeles International Airport, which accounts for their high per' centage of industrial commercial, mainten' ance trade as the airport grows and new plants are built.

Accounting breaks it down into 30/a hardware and paints, 70/o bfilding pro' ducts.

They discount almost all bills, allowing 2/o ofr on invoices paid before the 10th of the month. Charge business has tripled in one year, with Mastercharge, Bank' Americard and Southland's own financing making it possible. Their retail trade area covers nearby Westchester and Playa del Rey and down the pacific coast to Palos Verdes, about 12 miles away. They schedule regular delivery runs to the airport and Westchester, free to regular accounts and new orders over $20. A lumber roller truck and two one-ton pickups are used. They charge $9 per hour for cutting lumber.

Southland employs four inside personnel, 4 to 5 outside and one part-time inside man for cleaning and stocking. Harrner hirtx lrom Xlerchant Xlagazine classified ads. He uses local classified ads when not looking for experienced. specialized help, lr'hich he finds in The Merchan. He's had no luck u'ith the unemr)lovment bureau.

Southland Lumber is open 7 a.m. to 5 I).m. on weekdays. 7 a.m. to noon on Saturdays. Plant size is 165' x 2,X0', with a 2..1.00 sq. ft. showroom. Office space in the two story building accounts for 288 sq. ft.; parking covers 9.500 sq. ft. The lumber area covers approximately 130,000 sq. ft. The cost of land is high in Southland's area; so. Harmer plans to build up. The major shed will be revamped this year from storagc to selling-storage, stocking hardu'oods. pine. bolts. finished goods, a larger panel displav. floor tiles. and building products. It rvill increase plywood storage by 50/o or more. He'll be adding I.000' to the store in 1969, inch"rding a new load rack set up and a nt'rv fork lift to reach high spots.

Harmcr av('rages $d,000 per year on advertising, mostly in the Yellow Pages of the phone directory where he lists the yard under specialty classifications like wallboard, ceilings etc. Southland was with the Bill Dine service: but Harmer feels his type of operation doesn't get full benefit from Bill Ding, which nettt'd him only three calls per day. Ocassionall,v Harmer uses co-op ads.

The yard handles jolrs right on through to llooring and paints. They handle roofing work for small contractors. Pre-fab work includes crating and precutting plywood, hardboards, shelving, etc. No heav1. work like trusses is donc. Southland's open purchase orders with most major airlines at the airport rcquire selling plumbing and electrical. welding supplies. micro switches, industrial steel. bolts, anything those accounts nced. Harmer digs to fill unusual orders in the Yellow Pages, related accounts or new (iontacls. This helps keep big accounts and saves them time. Harmer finds that name hrands outsell unadvertised brands 2 to I. Price makes no difierencc. Rt'garding his busine-*s. Harmer said" "All phases have gone up this year." Fencing, patio sales, roo{ing and room addition are seasonal. Biggest incre.ase in business in the last l0 years is hardware, which ties in successfully with constmction, industrial and paints.

Southland originated in l94X when Harm('r's sister, Mrs. Miller, and her husband opt'ned a war surplus and lumber store. Harmer joined the husband-wife duo when he got out of tht' Navy in 1946, the same yt'ar the business left war-surplus and went retail building materials. Harmer, whose lather sold logging supplies in Oregon, handlcs the buying and management of the yard. while Mrs. Miller, who was widowed, takes care of credit. oflir:c and retail sales.

John Crowell, Mrs. Miller's son, is yard foreman. Harmer is a cub scout pack leadcr. is active in PTA, Baptist Church, Exchange Club and Inglewood's Chamber of Commerce. Activitics "broaden your outlook," he said, "sometime-q you get pocketed in too mur:h in your business."

Harmer feels that home building associations should promote more room additions, and outside remodeling of older homes. modernization and upgrading. His yard serves an area which is completely built up in housing. Too much emphasis is placed on attics and basements, which have little or no value in southern California. He believes working with local retail Iumber associations improves the image of the lrrmlrt'r business.