NLBMDA conference focuses on efficiency
LAS VEGAS —Making builders more efficient—and capturing more market share in the process—was the theme of the 2007 Industry Summit of the National Lumber and Building Material Dealers Association (NLBMDA), held in Las Vegas from Oct. 4 to 6. Lumberyard owners from around the country shared best practices, listened to consultants and networked with vendors at the JW Marriott Resort & Spa.
Scott Sedam, president of True North Development and a former Pulte executive, talked about the opportunities inherent in a down market. “People are feeling desperate,” Sedam said. “There are builder customers you can capture out there if you’re willing to change—especially if your competitors aren’t.”
Change can take many forms, and not all of them involve price, Sedam said. But many dealers are afraid to take a chance on new innovations or ways of doing things when times are tough. With some economists projecting a building downturn beyond 2008, “I don’t think staying the course is the answer in this market,” Sedam advised.
Dealers broke up into discussion groups to offer up their own suggestions on how to differentiate themselves in the eyes of their customers. Many of these ideas revolved around eliminating waste, either in time or materials. Some were as simple as removing the doors from sales offices to make customers feel more welcome.
Richard Cortese from TW Perry in Gaithersburg, Md., liked the idea of having his dispatchers call ahead just before the trucks leave the yard to see if there’s anything else to add to the order. “It was worth it coming just for that one idea,” said Cortese.
Offering free bookkeeping services for small contractor customers made sense to Ken Marson of Marson & Marson Lumber. “We have a vested interest in making sure they do well,” said the Leavenworth, Wash., dealer.
Other professional speakers at the conference included Ruth Kellick-Grubbs, a management consultant with the building supply industry who spoke on “Operational Excellence,” and Paul Bumblauskas, a sales training and development consultant who tackled “Practical demand-based marketing for the LBM industry.”
This year’s summit came at a tumultuous time for the association, whose president, Shawn Conrad, departed a week prior to the event. The NLBMDA board of directors voted on Oct. 4 not to replace Conrad, opting instead to turn its day-to-day operations over to SmithBucklin, a trade association management company. The NLBMDA will close its office in Washington, D.C., and move into a SmithBucklin office inside the Beltway during a 60-day transition period. The management group will now handle the lumber association’s staffing, accounting, educational programs, government relations and other functions.
Russ Snyder, a SmithBucklin employee, has been named as the NLBMDA’s interim president. The association will save approximately $170,760 a year by contracting with an outside firm, according to an analysis by SmithBucklin. The firm also manages the North American Building Material Distribution Association, trade association of LBM wholesalers, as well as the North American Association of Floor Covering Distributors and the Wallcoverings Association.
Various NLBMDA committees gave reports on their activities at the board’s annual meeting, including an update on the Innocent Sellers Fairness Act, a piece of federal legislation designed to shield lumberyards and other retailers against lawsuits. The bill now has 54 cosponsors in Congress. On the state and local level, regional trade associations are trying to find a legislative solution to the many scams involving fraudulent money orders and out-of-state orders for building materials.
“We’re seeing a significant increase in attempted scams against our retailers,” said Rick Seely, president of the Michigan Lumber & Building Materials Association. The various lumber associations would also like to craft a common position on the immigration reform issue, Seely said, adding, “We need to be speaking from the same page.”
The LBM Institute, the educational arm of the NLBMDA, will be tackling the plethora of green building standards—those now in play and those yet to come—in hopes of developing a common set of standards for residential building. A meeting for this committee, headed by Carl Tindell of Tindell’s in Knoxville, Tenn., is set for Nov. 13.
As always, the NLBMDA conference ended with a changing of the guard, as Steve Kelly of Kelly Bros. Lumber in Covington, Ky., finished his term as the association chair. Harold Baalmann, president of B&B Lumber in Wichita, Kan., was installed as the new NLBMDA chair.
Third-quarter earnings up at 3M
St. Paul, Minn.-based 3M had record third-quarter sales and earnings, with earnings growth of 7.4 percent to $960 million compared with $894 million in the same period last year.
The company had net sales of $6.2 billion, up 5.8 percent from $5.86 billion last year.
George Buckley, 3M’s president, chairman and CEO, said the company saw gains across all its business segments. In consumer and office products, 3M saw sales grow 5.9 percent to $898 million compared with $848 million in the same period last year. The company’s safety and security products business saw sales rise 10.9 percent to $766 million from $691 million last year.
“The strength of the 3M portfolio was evident in the third quarter as we again generated record sales,” Buckley said. “Geographic diversity was also an important factor. We continue to accelerate investment in research and development, sales and marketing and in simplification of our supply chains.”
3M has business offices globally, with operations in other industries including industrial and transportation; health care; display and graphics; and electronics and communications.
Weyerhaeuser to shutter three iLevel plants
Federal Way, Wash.-based Weyerhaeuser will “indefinitely curtail” operations at three iLevel building products plants because of “slow customer demand.”
The curtailments include an oriented strand board (OSB) plant in Drayton Valley, Alberta; an OSB plant in Wawa, Ontario; and a laminated strand lumber plant in Deerwood, Minn. Work will halt at the plants before the end of the year, the company said.
“The decline in North American housing starts has reduced demand for wood products, requiring us to rationalize our supply of OSB and engineered wood,” said Steven Rogel, chairman, president and CEO of Weyerhaeuser. “We remain committed to these markets. This move enables our remaining plants to better execute our customer strategies.”
The Wawa and Drayton Valley plants are two of nine OSB mills in the Weyerhaeuser system. Wawa has an annual production capacity of 470 million square feet of OSB, while Drayton Valley has a capacity of 415 million square feet annually, the company said.
The Deerwood plant can produce six million cubic feet per year of engineered strand lumber and is one of three such plants owned by Weyerhaeuser.