Trend #2: Model of Efficiency

A challenging housing market is driving cabinetmakers to maximize utilization

SPRINGFIELD, Ore. – Just two years removed from one of the biggest housing booms of all time, the pullback in new construction will create a challenging 2008 for cabinet manufacturers. Fewer homes mean a smaller demand for case goods.

“Buying the right product and utilizing the material in the most efficient manner is the name of the game,” said Mario Serra, National Accounts Manager at Timber Products. “Everyone is trying to maximize efficiency while decreasing waste."

The trend toward product efficiency is expected to reach new heights in 2008 as companies plot strategy and search for new ideas to make it through a rougher-than-expected market.

Maximizing Relationships
During challenging times, suppliers can be an even more valuable business resource. Serra said his company’s consultative services have experienced great demand as cabinetmakers face the 2008 climate.

“Timber Products takes it a step further by acting as an efficiency consultant and helping customers determine the right materials for the end product,” said Serra. “We can simplify the ordering process, suggest product alternatives and deliver at just the right time to save our clients money and improve the bottom line. We always ask lots of questions and truly discover a customer’s needs.”

For example, in an effort to reduce material costs, Serra is seeing more manufacturers considering frameless cabinet lines, a popular European style that is gaining popularity with American homeowners and kitchen designers and don’t require expensive hardwood frames.

Five Top Tips
To increase efficiency in 2008, here are five steps that cabinetmakers can consider:

1. Use alternate cores: Hardwood plywood with a core other than particleboard, MDF or veneer often can be less expensive. In addition to the standard offerings, Timber Products has a new OSB center panel that is very strong, sturdy and more economical.

2. Swap species: Cabinet manufacturers can reduce costs by using a lower priced species. Timber Products recommends introducing new species as a way to lower cost while maintaining style and appearance. For example, Serra suggested Lyptus, a readily available, sustainable species that is similar in grain and appearance to cherry, alder, and mahogany. The cost is significantly less and the appearance nearly identical.

3. Order cut to size: Companies can order panels cut to the exact size they need rather than making the cuts themselves. “This maximizes panel utilization,” said Serra. “Timber Products will make all the cuts so the company is buying 100 percent usable product. It’s also an easy way to control payroll and equipment costs while increasing productivity.”

4. Think big: Buying alternate size panels greatly reduces waste. Timber Products recently was the first panel manufacturer to introduce a 4x9 panel that is gaining more interest in the market because it can produce standard 6-foot and 3-foot cabinets without waste.

5. Pre-finish: Cabinet companies that might not have the capacity to finish product or that have reached VOC limits can order hardwood plywood panels from Timber Products that arrive prefinished. This service reduces the labor of finishing the product on-site.

Look Beyond Costs
Serra said manufacturers should look beyond the price sheet to be successful in 2008.

“Some shops get confused between the purchasing cost and the utilization cost,” he said. “Utilization cost is the final real cost of a finished component, panel or door after the manufacturing process. It is possible to buy hardwood panels that have a very low purchase price but a very high utilization cost. Our job is to provide our customers with a panel that not only has a competitive purchase price in the marketplace, but also results in a very low utilization cost once it has gone through the complete manufacturing process.”

Contact: Gary Rubin, CMD, 503-488-4443, grubin@cmdagency.com

About Timber Products Company
Founded in 1918, Timber Products Company offers a wide range of diversified wood products, specializing in hardwood plywood. The company is one of the largest material suppliers to the U.S. kitchen cabinet industry. Timber Products owns nine state-of-the-art manufacturing facilities across the United States, a major international division, and 118,000 acres of forestland in Northern California managed under the strict standards of the Sustainable Forestry Initiative (SFI®) program. Timber Products was the world’s first hardwood plywood manufacturer authorized to carry the SFI label. The company also operates TP Trucking, a nationwide transportation division.