Marketing Locally Made Wood Products in the Charleston, WV Metro Region

WVU Kanawha Extension Office

Tuesday, June 7th, 2011

Charleston, West Virginia

Harry W. WattBusiness Improvement Specialist

Wood Products ExtensionNC State University

harry_watt@ncsu.edu704-880-5034

www.cnr.ncsu.edu/localwood

Discrimination Policy Statement

The work upon which this project is based was funded in whole or in part through a grant awarded by the Wood Education and Resource Center, Northeastern Area State and Private Forestry, U.S. Forest Service.

In accordance with Federal Law and U.S. Department of Agriculture policy, this institution is prohibited from discriminating on the basis of race, color, national origin, sex, age, or disability. (Not all prohibited bases apply to all programs.)

To file a complaint of discrimination, write USDA, Director, Office of Civil Rights, Room 326-W, Whitten Building, 1400 Independence Avenue, SW, Washington, DC 20250-9410 or call (202) 720-5964 (voice and TDD). USDA is an equal opportunity provider and employer.

NC State University Wood Products Extension

• The Outreach of the Wood Products Department to Industry

• Since the Early 1950’s

• Focus on Providing Educational Information and Support on the Proper Processing and Use of Wood

• Often Working on Issues of Wood Processing, Drying, Gluing, Finishing, Factory Design, Manager and Employee Training, Product Design and Engineering, Business Strategy and Management, Marketing

Wood Education and Resource Center

• Located in Princeton, West Virginia

• US Department of Agriculture and US Forest Service

• Supports the Eastern Hardwood Forest Region (35 States East of the Great Plains)

• Offers Educational Support of Biofuels, Wood Processing, Employee Training, Research and Marketing Projects

Workshop at WERC

Are Popular

Local Marketing Project

Phase I = Three Target Metro Cities to Research

• Atlanta, Georgia

• Charlotte, North Carolina

• Charleston, West Virginia

Atlanta, GA Charlotte, NC Charleston, WV

Project Purpose

• Research the Issues Related to Growing the Sales and Profitability of Wood Products Manufacturers and Retailers by Growing Sales in Local Markets

• Support Economic Growth and the Demand of Hardwood Lumber Used in Cabinets, Furniture and Millwork Wood Products

Project Purpose

• Most of the Job Losses and Reductions in the Use of Hardwood Lumber (we have dropped about half our usage since 2000) has Occurred in Wood Products Operations That Sold in National Markets

• This Project Wants to Help Those Manufacturers Find Local and Regional Markets Plus Assist Those Who Produced Only Locally/Regionally or Retailed Wood Products to Grow Sales

Today’s Schedule

Topics by Session Start Time Researching building permits for prospects 9 AM Marketing to builders and homeowners 10 AM Marketing to architects 11 AM Lunch Noon Marketing to local governments 1 PM Marketing to retailers 2 PM Using 3-D design software to support designs and marketing 3 PM

Success Factors for Wood Products Manufacturers and Retailers

• Must Love or Show Passion for Some Aspect of the Business

o Wood

o The Product = Cabinets, Furniture, Millwork

o Design, Creativity, Engineering

o Sales and Marketing

o Building Relationships With Others

Success Factors for Wood Products Manufacturers and Retailers

• Must Put Out Lots of Effort and Work

o Lots of Time Thinking About the Business

o Lots of Hours Working in the Business

o Lots of Time Doing the Things That Build Up the Business = Foundation Work

It is Often Said in West Virginia-

• Why Do We Ship Lumber Out of State to Make Value-Added Wood Products When We Could Make Cabinets, Furniture and Millwork Here?

• West Virginia Has the Best Lumber in the Eastern Forests = Premium Species + Large Tree Sizes + High Volumes

• West Virginia a Great Location That Can Reach Markets in All Directions = North/South/East/West

US Businesses Have Lost Market Share to Global Manufacturers

• More to Those Factories That Sold a Limited Product Line to National US Markets, Like Casegoods Furniture

• High Variety Low Volume Products Like Kitchen Cabinets and Upholstered Furniture Have Fared Better

• Perhaps Manufacturers and Retailers Should Focus on Non-Commodity Products

This Project is Focused on Marketing to Buyers That Live Close to the Shops and Factories in the CMR

• Lowest Cost to Market

• Best Knowledge of the Buyers

• Can Tap Into the Desire of Buyers Who Want to Buy Locally Made Wood Products

Charleston, WV is a Minor Metro Region in the USA and is the Smallest in the Study Three

Cities

% of USA Market for: Atlanta 1.42%(based on population) Charlotte 0.76%

Charleston 0.14%2.32%

2009 Population Estimate of the Charleston, WV Metro Region-

Total Population = 444,394

Total444,394

Roane14,870

Raleigh79,187

Putnam55,673

Lincoln22,147

Kanawha191,663

Fayette46,123

Clay10,022

Boone24,709

# Households at 2.4 Persons Per Household

Total = 185,164

Total185,164

Roane6,196

Raleigh32,996

Putnam23,197

Lincoln9,228

Kanawha79,860

Fayette19,218

Clay4,176

Boone10,295

Population Growth 2000 to 2009Far Behind the National Average of 9.7%

Total0.6%

Roane-3.7%

Raleigh0.0%

Putnam7.9%

Lincoln0.2%

Kanawha-4.2%

Fayette-3.1%

Clay-3.0%

Boone-3.2%

Source-Census Bureau Quick Facts, USA Change = 9.1%

Low Population Growth Offers Unique Challenges

Marketing Is Now the Most Important Activity Wood

Products Businesses Need to Pursue for Success

• Most Shops and Stores Have Adequate Facilities and Equipment

• Most Shops and Stores Have Laid Off Employees and Are Running At Less Than Full Capacity

• Better Marketing is Needed to Gain Sales and Grow Profitability

Lots of Potential Contacts to Connect to Local Buyers

of Wood Products

ManufacturersRetailersInterior Designers

Home DesignersArchitectsSchools

BuildersGovernmentsHomeowners

We Will Discuss How to Find Prospects in Each of These Customer Groups

Typical Marketing Efforts

• Market Research-Identify Needs and Prospects

• Marketing Plan Creation

• Product Line Design and Product Development

• Sales Force Creation, Launch and Support

• Marketing Support Literature

• Engaging Prospects and Customers

• Booking Orders

Introduction-Summary

• Reinventing Hardwood Project is a USFS Attempt to Support the Manufacturers and Retailers of Cabinets, Furniture and Millwork to Grow Their Businesses

• This Projects Hopes to Grow the Sale of Hardwood Lumber to Support Landowners, Sawmills and Value Added Businesses

• The US Can Help Its Economy By Replacing Imported Wood Products With Locally Made Wood Products