After Lumber . . . What Other Products – Why?

Lumber markets can be grouped into two broad general categories– construction and industrial. A major portion of the construction market is home building in which two important facts stand out: 1) Five of six houses are designed and built for an unknown buyer; 2) less than 1/4 of the total number of builders build 80 percent of the houses. Lumber has lost out in many markets. An estimated 70 percent of the siding market has been lost. An annual market of 1 billion board feet has been lost to concrete slab floors; plastics and metals have made serious inroads. Lumber consumption by railroads has been reduced. Advancing technology may have left the lumber industry behind; innovation and product development are needed. Electro-mechanical stress grading will improve the position of wood and simplify design precedures. Factory finishing of lumber has market benefits; combining boards into larger sizes by gluing will facilitate use of lumber in houses. Combining roof sheathing and shingles will reduce application cost. Product development involves selection of the product, development of the product, and manufacturing and marketing of the product. Selection can be handled by asking: Is it practical? Is it profitable? Is it patentable? Do people want it? Commercialization of the product may cost 10 times as much as all previous expenditures. The company must be financially capable to carry product through to full commercial realization and be able to lose the investment without wrecking the company. If you reject a good product you will lose more money through lost potential profits than you will by carrying an unsuccessful product to commercialization only to find it a failure.

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