Orlando, Florida -- The Wood Container Technology Coalition (WCTC) held its first meeting three years ago in Seattle. This year’s March meeting, the fourth in a series, followed successful meetings in Atlanta and Chicago. Each meeting grew in attendance from the previous one, and attendees always expressed appreciation for the solid programs and what they carried away from the meetings. With this background, the planning committee again expected growth because of past successes, an Orlando location, and an improving economy. Close to 60 attendees enjoyed another exceptionally strong program. While the number of registrants did not meet expectations, I spoke with many of them during the two and a half day event; all of them expressed their appreciation of what they learned.

            The WCTC started because a handful of people were not satisfied with what the wood container industry had in the form of meetings and educational opportunities. The main focus in the wooden packaging industry has been on pallets because they represent such a major part of the field. Wooden containers tend to be much more specialized; as such, container people may be a little less inclined to share what may be more proprietary ideas.

            The National Wooden Pallet and Container Association (NWPCA) restarted its Wooden Container Committee with an initial organizational meeting in October 2003 at the Memphis Pallet Summit. Tim Catton of Stapling Machine Company is currently serving as chairman of this new committee, which met for the second time at the NWPCA San Diego meeting in February and then again prior to the Richmond EXPO in early June.

            The committee that has been planning WCTC meetings and the NWPCA are currently discussing the potential for joint future efforts. At this time, the two groups have not come to any conclusion how they can work together to meet their differing objectives.

            While the wooden container industry predates the pallet industry by many decades, its market declined significantly when corrugated containers grew in popularity. But wooden containers continue to serve an important role in moving and storing many products, particulary agricultural products, large industrial items, and lower volume items that need good protection and may require custom sized packaging. Wooden packaging demand seems to have stabilized somewhat in recent years and promises some additional growth and a dependable future as global shipping becomes more and more a reality. The versatility of wooden containers promises future opportunities as customers realize that they need this kind of asset.

            Networking, one of the highlights of this meeting, was outstanding, as it was in previous meetings. The exhibit hall featured tabletop exhibits by 10 organizations: Industrial Reporting, Inc., publisher of the Pallet Enterprise; Stafford Inspection Services, a phytosanitary inspection and auditing service; Klimp, an established manufacturer of metal fasteners for easy to assemble wooden containers; Valeron; Stapling Machine Company, a manufacturer of stitching machinery and systems; Merit Resources; Deploy Tech, a supplier of box, crate and pallet design and costing software; STI, an educational company specializing in sales training; Endurapak, Inc.; and the Southern Forest Products Association, an association that specializes in SYP lumber.

            One major fact stands out about this meeting – its program content. Once again the planning committee succeeded in putting together an unusually strong and solid program, including presentations from both leaders within our industry and knowledgeable outsiders. There is no way that I can do justice to all of the material that was presented during the packed two and a half day program, but I will share some highlights.

 Third Millennium Selling:

Winning Tactics, Strategies

            Mark Halverson of the APA-The Engineered Wood Association again served as master of ceremonies and introduced the speakers. Mark appropriately introduced Conrad Elnes of STI International, whom he had recommended as a worthwhile speaker on sales. The committee was glad that it had taken Mark’s advice because Conrad presented a continuous string of valuable sales advice throughout two four-hour sales sessions. I came away enthused about the importance of selling and wondering how much of what he shared I could take back to my own staff.

            Conrad emphasized the importance of creating allies within the circle of buyers, people who will act to help you get a sale. Allies range from acquaintances to casual friendships, business friendships, and finally personal relationships. The more business friendships and personal relationships one can develop over time, the better position he is in to acquire sales and provide customers with valuable products and services.

            The ‘circle of buyers’ includes: the financial buyer, who makes the final purchasing decision; screeners, who compare suppliers and products; specifiers, who help design the final product, including performance standards and purchase specs; and users, who help establish the need for a change of product or supplier. All these allies can be valuable in providing the products and services that make a supplier valuable. While not all can approve a purchase, all can influence the selection process in their own ways.

            Conrad recommends the four-step quad-trak interview model for sales calls. It includes four kinds of activities that help build enduring relationships with customers – establishing rapport, fact finding, presentation, and closing. Establishing rapport creates an ally by employing conversational skills and agendas to build trusting, harmonious relationships. During fact finding, the buyer coaches the supplier by giving information and guidance needed to win the business. Fact finding typically begins after establishing rapport and continues until the supplier feels certain the prospect is qualified to buy. During a presentation, the supplier coaches the buyer. One often hears about salespeople who have difficulty closing a sale. Closing is asking a buyer to make one of several potential kinds of commitments, such as recommending you to their manager or closing for a commitment to place an order. If a buyer objects, a process of mutual coaching begins and continues until the sale is closed.

            In addition to the four main interview segments depicted in the quad-trak model, Conrad suggests that you perform up to three minor activities. First, when you interview new prospects, plan to spend two or three minutes between the establishing rapport and fact finding sections presenting your introductory qualifications. Second, in every interview conclude fact finding with a summary of needs. Lastly, conclude each presentation with a review of benefits to set up the close. Conrad stressed the importance of taking a brief time to set an agenda for each meeting. He made an interesting suggestion that after serving a customer for a year or more it is okay to set up a meeting with the CEO. It is always valuable to have allies in the corner office.

            There is no way that I can do much more than touch on some of the basic framework that Conrad presented. He focused on many details that will help anybody who is selling. The longer I listened to Conrad talk, the more common sense laced through his comments. It reinforced what I have always believed, that everybody has some kind of impact on sales. Although some people are directly involved in sales, and some others are indirectly involved, just about everybody has an influence in some fashion. Certainly anybody who interacts directly with customers or suppliers is selling, whether or not he knows the importance of his efforts.

            Every reader should be aware of the importance of sales. But do we realize the value in sales training? After being exposed to Conrad’s sales experience and wisdom, I have come to appreciate the value of professional training. While I have not yet instituted any specific sales training efforts in my own company, I am considering options that can make everybody in our organization into a more effective salesperson. If a reader would like more information on sales training options available through Conrad’s STI International Company, you may contact him at 800/784-1552.

‘Lean Manufacturing’

            ‘Lean manufacturing’ is a common buzz word in workshop training and business literature in recent years. I suspect that many readers are similar to me in that you have heard about it but have little to no specific knowledge of the subject. I don’t know exactly what I had thought lean manufacturing meant, but what I learned during the two presentations on this topic opened my eyes to the reality of its value for the wooden packaging and wooden pallet industries.

            Lean manufacturing has burst onto the forest products industry scene in just the last few years. Seminars on the subject are now being taught at many universities that are leaders in forest products, such as Virginia Tech and Mississippi State. Books on lean manufacturing for the forest products industry are now available as well.

            Dr. Steve Hunter from Mississippi State University, author of Lean Manufacturing Systems and Cell Design, used a Mississippi furniture manufacturer as an illustration of cellular manufacturing. His emphasis was on ergonomics in manufacturing – focusing on the role of humans to make manufacturing both efficient and safe. Fitting tasks to the people, not people to the tasks, is a challenge in designing manufacturing cells. One has to consider the relationships between manufacturing system designs and worker ergonomics.

            Some readers might tend to think of higher tech industries with clean environments as being the best targets for lean manufacturing and manufacturing cells. Do not make this mistake. The techniques are applicable in virtually any factory where people interact with raw materials and products.

            The furniture plant that Steve used as an illustration was anything but sophisticated. He presented the benefits that can accrue from changing the flow of products and materials, changing the location of workers within the cell, and changing the way a worker performs his particular task. This factory has dirt floors. That didn’t change, but the efficiency certainly did.

            Steve was able to design a cell where two people accomplished similar production to that which previously required four people. In another part of the plant, by instigating what is called a double D cell, Steve was able to reduce the people required from 11 to seven while maintaining output.

            From a practical perspective, Steve made some useful suggestions for getting a lean manufacturing conversion started. These suggestions are not totally new, but they are applicable to many important changes. First, top management must buy into the concept; it needs to come from the top down. Second, get ready to change; people need to see the value to both them and the company of making the right kinds of changes. Third, educate, educate, educate. This is an area where our industry has often fallen short in the past. Education can take all shapes and forms, from simple common sense internal approaches to involving the right kind of consultants.

            Greg Pearson is vice president of operations for Floe Manufacturing and works with boat lifts and dock systems, but he has 27 years of experience in wood manufacturing, including successful lean manufacturing conversions. Greg made several points about lean manufacturing that I want to share here.

            Lean manufacturing is a common sense philosophy that works to eliminate waste of all kinds. It requires moving people and making changes in how they do things. Lean manufacturing reinforces continuous improvement. It may well require cultural changes.

            Greg emphasized the 5S system that includes sorting, setting in order, standardizing, and sustaining. Adding safety brings it to 6Ss. Greg stated that the improvement in plant safety at Floe had been almost unbelievable. They had gone from a poor safety record to an outstanding one.

Additional Program Topics

            In addition to sales and lean manufacturing, numerous important topics rounded out this meeting. Many presentations featured speakers from our industry while others included outside experts.

            Bob Legg from the Temperate Forest Foundation (TFF) gave a luncheon speech about the educational efforts being supported by the TFF. For years I have heard members of our industry complain about the lack of truthful information about the forests and their products in our educational system. The TFF is doing something about this unfortunate situation. It is helping to educate teachers in the K-12 grades in both the U.S. and Canada so that they can bring the truth alive to their students. Four-day teacher tours are conducted each summer. This summer’s tours are in Arkansas, Idaho, Minnesota, and New York. Key tour concepts include: managing large landscapes, nature’s dynamics, foresters can manage for desirability, sustainable forestry, protective regulations, forestry is capital intensive, application of high technology, complete utilization of resources, wide spread dependence on forest products, and wood as an environmentally sound building material.

            Dr. Ed Brindley, your author, presented his second annual wood container survey. I compared this survey to the results from the first one when possible and elaborated on individual questions and results from a practical perspective.

            Reflecting the belief that the economy was improving, about five times as many survey respondents expect market growth over the next three years versus those expecting a shrinking market.  It is noteworthy that respondents were closely divided when it came to 2003 sales volume versus 2000 sales volume; so enthusiasm continues concerning what the future might bring. Sixty percent of respondents indicate that there is a growing demand for containers that meet phytosanitary regulations versus 35% that see no demand, and 5% see demand unchanged. Copies of the survey powerpoint slides are available to readers who subscribe to Pallet Profile Weekly.

            Dr. Brindley also covered a wide spectrum of current event issues that are impacting the wooden container industry. These issues included lumber supply problems and prices, the growing impact of RFID technology, pallet rental and pallet management (including CHEP and its legal challenges), the shortage of labor and how Hispanics are filling this void, OSHA and its recent targeting of the pallet and container industry, and the overcapacity that exists in the pallet industry. Future growth opportunities in the pallet and container industry include heat-treated products, the management of unit load containers, and a potential shift toward block pallets.

            The third day of the program started with a focus on safety and human resources. Ron Stoll of Merit Resources made a good presentation on the value of outsourcing. I had not given outsourcing that much thought in our industry, but his information put a different perspective on it for me. Outsourcing has the potential to allow management to focus its attention on core issues and get outside assistance for items that use excessive amounts of time. Business functions that are often outsourced today include human resources (including payroll and benefits), finance and accounting, administrative services, and procurement call center operations. Major federal laws that affect smaller company’s employees include EPA, OSHA, WC, IRCA, ERISA, UC, and FLSA.

            Jerry Brecke of Risk Control Inc., an independent risk management consultant, stated that large companies tend to pay more for insurance but get a lower rate. There is some growing concern about the financial stability of insurance companies. He believes that consolidation of insurance companies will reduce competition and eventually increase rates. He recommends that a company get close to an agent who can help the company save money on insurance coverage. He suggested that you not put your company in jeopardy; insure it to its value. Gamble on only what you can afford to lose. Jerry emphasized safety and its impact on workers comp experience modification factors.

            Gordon Hughes, the executive of the Canadian Wood Pallet and Container Association, has written both a Health and Safety Manual and an Industrial Fire Safety Plan. The CWPCA has an industry safety group. The four elements of a health and safety program are leadership, organization, hazard recognition and assessment, and controlling activities. The five steps to managing a program are: setting standards, communicating, training, evaluating, and acknowledging success and making improvements. Remember: safety is not a one year program; it is a continuing process.

            Paul Jannke of Wood Products for Resource Information Systems, Inc. (RISI) discussed the lumber market and what the future will bring. He presented a great deal of analysis on the markets as he defended his thesis that strong lumber prices in early 2004 will give way to a cyclical decline in the second half of the year.

            Barry Zuckerman of the Weber Co. said, “Strategic procurement needs to be strategically linked to the business.” Procurement should not be concerned only about expediting parts and obtaining low prices. Some of the primary objectives on tactical purchasing are buying at the lowest possible price, having a high inventory turnover, maintaining continuity of supply, maintaining consistency of quality, developing alternative sources, and developing good supplier relationships.

            Roger Young of the General Services Administration has worked diligently for wood box standards, and how the GSA uses them. The government developed wood box standards over 60 years ago when military products arrived damaged.

            Roger discussed the nine wood box or pallet standards established by the American Society for Testing and Materials (ASTM). These standards came out of the ASTM D10 packaging committee. He discussed in detail two ASTM standards - the ASTM D6039 “Standard Specification for Crates, Wood, Open and Covered” and the ASTM D6199 “Standard Practice for Quality of Wood Members of Containers and Pallets.”

            Wilmer Snell from the USDA APHIS program and Gordon closed the program with updates on the phytosanitary packaging programs for export wood packaging. We have helped readers stay abreast of this issue through both the Pallet Enterprise and Pallet Profile Weekly. The NWPCA has made it a major issue to keep its members informed about this moving target. I cannot recall any issue that has moved as often or as unpredictably as heat-treating for exported wooden packaging.

            After two and a half packed days, attendees left feeling they had gotten their money’s worth. Many expressed an interest in returning to a future WCTC meeting. At this time no decisions have been made about when the next meting will be held, where it will be held, or what the program content will include.