Retailer and Consumer Vie*points on Grade-Marking

By Kenneth Smith Secretary-Manuger, Lumber a Allied Products lnstitute, Los Angeles

Address Delivered at the Annual Meeting of the West Coast Lumbermen's Associotion, Tocomo, Wosh., January 99,1937

In 1930 the progressive retail lumber merchants of Los Angeles embarked jointly with you (as your licensees) upon a great adventure in merchandis;ng. We needed desperately to end substitution of No. 3 for "Common" in order to overcome the price chaos that was destroying the established businesses built and carried on for the previous 60 years on the basis of selling just one grade of construction lumber-"Common". You needed just as badly to restore the confidence of the public in lumber in that great metropolitan market.

We carried the torch for you through the depression even after you were forced to discontinue your trade promotion work. Then, in 1936, we really "went to town" with "'W. C. L. A." officially grade-marked Douglas Fir Boards, Dimension and Timbers.

It is a happy privilege to be here today to report on the achievements of our joint enterprise and I hope, by giving you a picture of that experience, to bring you something that will be helpful to you, not only in cooperation with us in pushing forward to greater achievements in the selling of your products, but in the reestablishment of confidence in Douglas Fir in all of your markets to an even greater degree than we have so far achieved in Los Angeles.

Grade-marking was mothered by necessity. It was adopted by the lumber industry as an essential measure to arrest the growing public disgust with lumber grades and merchandising practices; to prevent sub-standard lumber being sold as standard; to prevent grade substitution and lessen product substitution; to safeguard the integrity of the industry's standards; and restore the age old confidence of the public in wood.

Necessity, needless to say, kicked us into a realization that we must do what had long been advocated as both ideal and practical, that is: Quit selling unmarked lumber ourselves and then "take the mystery out of lumber" by telling the public why we were no longer going to sell Douglas Fir Boards, Dimension and Timbers unless each piece bore the official grade-mark of the West Coast Lumbermen's Association.

Depression emphasis on "price" had brought us by 1935 to the point where lumber was being sold on price alone again almost to as great an extent as was the case in 1928 and 1929 when we first began to seek some way to preventing our market from becoming strictly a low-grade "price" market and destroying the asset value of businesses which had been built on quality merchandising.

We had learned from experience that just offering grademarked lumber was not enough. Realization had come too, from looking a desperate situation in the face, that so long as we continued to countenance the selling of unmarked Douglas Fir for construction purposes, contractors would buy No. 3 and substitute it for No. 1. Worse, that the price at which No. 1 and No. 2 could be sold would cont;nue to be set by the dealer who carried nothing except No. 3.

So, when our leading dealers, comprising a group doing more than 75% of the business in Los Angeles, decided last year to quit selling unmarked Douglas Fir and spend $12,000 to correct that condition, their primary motive, very frankly, was to keep their own business from being destroyed by uninformed and unprincipled competition; but we had the added incentive to serve the public honestly and to build future good will for our industry and prevent further inroads of substitute competition by seeing to it, as far as we possibly could, that the lumber industry made no further contribution to the gypping of the public by jerry builders.

As evidence that I am not in any way exaggerating the seriousness of the situation which confronted us, I would like to quote you from a signed editorial published three rveeks ago in the Los Angeles Times:

"Early this year . a vigorous new campaign was launched to put the quietus on gyp building. Giving great impetus to this worthy campaign have been the efforts of the Lumber and Allied Products Institute of Los Angeles, the building requirements for F. H. A. insured loans and the proper building demands made by smart lenders. In a metropolis of such rapid growth as this such vigorous campaign is essential. Bitter experiences of the past emphasize that fact.

"In past very active building years here there were horrible examples of construction. There were houses put up of such flimsy construction that one could almost push his elbow through the walls.

"When the anti-gyp-builder campaign was announced this year,, it immediately took its place as one of the most important influences in making this not only one of the most active construction years Los Angeles has ever known, but also one of the best from the standpoint of good building.

"It is the kind of campaign that must go on and the promise is that it will. The movement that any such good and valuable efforts lets down, even to a slight degree, gyp builders crawl back into construction activities."

As that question from the Times evidences, our program has been astoundingly successful.

We have not discovered anything new and we have not done anything sensational. All we did was to quit selling unidentifiable grades and then use proven and established advertising principles to let the public know we had reformed.

We got enthusiastic about it. We made a fuss about it. We treated it as a great fundamental change in our business. (And it was). We gloated over the fact that we were no longer doing cracker barrel peddling. We got lenders to demand it. (Most of them are glad to do it because it is added insurance on their loan.) We convinced the specification writer that he protects himself and his client by <iemanding it. (Most of them were already doing it.) We convinced the sp'eculative builder that he gave himself a superb sales advantage by using it and then bragging he had.

We advertised to the home owner. We advertised to the casual consumer. We advertised to the purchasing agent, the speculative builder, the architect, the engineer and the contractor. We advertised to the lender.

We spend most of our money for 3 or 4-column ads that dominate the page. We blow one up occasionally to use as a poster in our yards and I have brought along a couple of these to show you more graphically than is possible by words just how we are handling this advertising campaign.

In the 10 months we have been running it we have used about 25 different ads but mostly they have been telling the

TRADE.MARKED SELECTED FIRM TEXTURBD

BATAAN--.LAMA()... BAGAC

Philippine Mahogany Philippine Hardwood

CADWALLADER GIBSON CO., INC.

Los Angeles, Calif.

Ctric. M. Wininger Manager and Sole Owner

Telephone Glencourt 4293

WHITE PINE, SUGAR PINE, REDWOOD, OREGON PINB, PLYWOOD PANELS, SHINGLES, LATH, ETC.

"Not the cheapest---Just thc best"

PYRAMID LUMBER SALES CO.

\THOLESALE LUMBER PRODUCTS

Room 415 Pacific Building Oakland, California

Dealers

WHO HANDLE ANGIER BUILDING PAPERS DO NOT HAVE TO GO OUT OF THE LINE TO COMPETE ON PRICE OR QUALITY.

THE ONLY COMPLETE LINE

SHEATHING PAPERS PLAIN-TREATED-REINFORCED-R,ESILIENT ANCOVER_BROWNSKIN-ECONOMY BROWNSKIN CONCRETE CURING PAPERS

HEAVILY REINFORCED WITH COR"DS AND BURLAP ANSULATE-STATITE_PROTECTOMAT CATALOGUE AND PRICE LIS? ON REQUEST.

Angier Corporation

Framingham, Mass.

35O So. Anderson St. 562 Howard St. Los Angeles San Francisco

Uholesale to Lumber Yards

guararutee - lf[tEY BR0S. - SAIIII lrl|llllGl

Lor Angeler Phone-REpubllc 0802 same story on about two themes in different language.

The lst: "IS ALL LUMBER JUST LUMBER TO YOU?" calculated to try and take the mystery out of the lumber business and to help the consuming public find out the grade best suited for the use they are making of it.

The 2nd: To sell the idea that the way to get what they buy is to specify W. C. L. A. officially grade-marked Douglas Fir Boards, Dimension and Timbers.

We have harped on the theme that grade-marking of lumber is not an advertising device; that it is a commercial practice to safeguard the integrity of standard products; that it is not a means of exploiting proprietary products; that it is an Association undertaking to secure adherence to recognized standard grading rules for their-and our own-protection.

We have gotten, in addition to the publicity which we sought, an astounding amount of editorial support. Our drive against jerry building found a very responsive chord in almost every org'anization in the city which is concerned with the construction industry and with the good to the public generally from a social and economic standpoint of having sound, satisfactory and economical housing. We have had the support of the Associated General Contractors, Building Contractors' Association of Southern California, the Apartment Association of Los Angeles County, the Federal Housing Administration, most of the builders, and practically every engineer and architect in the city.

And then we have had the support of, astounding as it may seem to you, some of the jerry builders in the city, not because we wanted it but because they recognized that the public was sold on grade-marked lumber and wholly for the benefit to them in merchandising their gyp houses, they discontinued using unmarked No. 3 and dunnage and began using grade-marked No. 2, in some cases even using No. 1 in order to use that as a means of convincing the unwary buyer that all of their construction was on a quality basis. Three different organizations in the city are working on other angles for controlling the jerry building in an endeavor to make it possible for the man of low and moderate income to safely buy a home and we are confident that, before 1937 is out, we are going to have the jerry builrlers definitely on the run in Los Angeles.

No Lumber Shorta ge or Price Squeeze, Says Vilson Compton

Washington, D. C., February 1-Noting with satisfaction the apparent settlement of the last remnants of the maritime strike, on the Pacific Coast, Wilson Compton, manager of the National Lumber Manufacturers Association, said today that there is no likelihood of a lumber shortage in any part of the United States, and that the current trade talk of an impending "lumber famine" is unwarranted. He criticized it as "scarehead salesmanship."

The steady increase over a period of many months in the consumption of lumber, combined recently with labor difficulties, especially on the West Coast, has led to much speculation regarding the supply of lumber. This is so particularly in view of the increased demands which appear certain in view of the success of the small homes demonstration drive now underway in every important section of the country.

Dr. Compton stated that the lumber industry will be amply able to meet all 1937 requirements for lumber. "Of course, the maritime strike," he said, "the tremendous floods in the Mississippi and Ohio valleys, and adverse weather conditions have caused many important temporary dislocations. But the industry has reserve capacity which is equal to any demand emergency."

Dr. Compton further explained that there had been a good deal of interested propaganda regarding an alleged prospective "lumber famine." He added that there is no reason why all the building plans in contemplation should not go ahead. No doubt, temporary difficulties here and there would present local problems of some magnitude; and a condition of lumber over-supply had become so chronic during the depression that it was easy, although inaccurate, to interpret a moderate increase in prices or a delay in deliveries as a serious lumber shortage, if not indeed a "famine."

Regarding prices, the lumber executive said that there have been some substantial increases throughout the country over prices in October, the last pre-strike month. The price spurts have been for the most part in markets ordinarily dependent substantially upon sources of lumber supply recently most affected by strikes and adverse weather. The present floods in the Ohio and Mississippi Valleys will not seriously obstruct the production of construction