If you are a wood company and want to environmentally differentiate yourself from the crowd. How do you do it? Why not look at what HLC did?
Bill Hayward, the CEO of Hayward Lumbar Company (HLC), faced some challenges:
Does it make business sense to sell FSC lumber? How should HLC prioritize its efforts for growth in the green niche? Should HLC invest in any on the new ventures (truss plant, design center, EcoTimber)? Are these ventures synergistic?
HLC is a 90 year old privately owned family business operating a number of lumberyards in California, US and is a dominant supplier of building materials.
Since the time Bill Hayward took over as the CEO in 1992, the company has seen a lot of changes in the way it sources its wood supply and has also affected positive changes in the otherwise traditional building industry, which was highly fragmented and solely relationship based. There were challenges…which you also might be facing!
- Builders preferred tried and true building methods than using innovative techniques
- Meeting deadlines and maintaining quality were imperative
- Restrictions in the lumber supply and economic recession
- Falling profit margins and mounting losses
HLC came up with a progressive “Hayward’s Green Manifesto” consisting of 3 part strategy:
- Providing comprehensive selection of green materials with short and reliable lead-time
- Stimulating demand through educating the key decision makers in the industry
- Bringing a culture change and incorporating environmental values in all decisions and activities
As we now know, HLC does sell FSC lumber and it went ahead with all of the 3 new ventures of building a design center and a truss plant and acquisition of Eco Timber. All the 3 ventures paid off. But at the time of making those decisions, it would have been highly uncertain.
So, here are the 6 ways that can environmentally differentiate your wood: (what HLC did)
- Sell FSC wood – It makes business sense as the general trend towards environmentally friendly building materials has begun (various Green Building certifications)
- Make FSC lumber available either at the same price or a lower price than the traditional wood supply.
- Expand your customer base by lowering price premium
- Do not spread yourself too thin and put resources and capital so as to jeopardize existing operations
- Calculate the Payback – it must justify the new ventures
- Offer holistic green solutions for builders
That’s how you environmentally differentiate your wood. Share what other ways can you green your wood/operations?
- A world first: Furniture Made from FSC and Fairtrade Timber (uniquebatikfairtrade.wordpress.com)
- Forest Certification Standards from Around the World Weigh In as Global Pressure Mounts for US Green Building Council to Accept Multiple Forest Certification Programs (prnewswire.com)
- FSC timber: worth its weight in wood? (ewtrial.wordpress.com)
Other case studies:
Balancing Customer Expectations with Supply chain realities – Seventh Generation
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