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Philip Bibeau, Executive Director, WPMA

For nearly 80 years, The Wood Products Manufacturing Association (WPMA) has been serving its members, a broad range of wood products manufacturers, and aiding them in navigating the ups and downs of the wood industry. Wood Digest asked Philip Bibeau, executive director of WPMA, to offer his thoughts on the state of the market.

Wood Digest: In 2008, what will be the primary focus of WPMA’s efforts?

Philip Bibeau, executive director, WPMA: WPMA will focus all of its efforts to help members generate additional new and profitable business opportunities as well as offer programs and services designed to help companies improve their bottom line. Since 1929, the WPMA has been assisting companies to become more competitive in the global economy. Sometimes the ability to network with other successful businesses can mean the difference between success and failure.

WD: Describe the current economic/business climate in your segment of the industry.

Bibeau: The current economy is forcing companies to work extremely hard for every order they can get. Members realize that the order “pie” is only so large and everyone is fighting for a slice of it.

Price seems to be a minor issue, as some companies are willing to pay the price if a company can deliver their product in 10 days or less. The biggest concern is that simply lowering the price is not stimulating sales as the problem is lack of demand.

The mortgage situation, rising energy and food prices along with a weak job confidence are causing people to “sit on their wallets.” The consumer is fixing or making do with what they have until conditions improve which slows down the entire manufacturing base.

WD: What are major issues/challenges WPMA members face?

Bibeau: One of the major challenges WPMA members continually face is the “totally price driven” customer who does not understand the true cost of the lower price.

With profit margins being squeezed and then resqueezed, companies are doing whatever they can to help the bottom line. The problem is that suppliers must educate their customers on the true costs of partial shipments, poor quality, late deliveries and the cost to borrow money for excessive inventory. We continue to encourage members to become partners with their customers and focus on delivering high-quality products with the shortest turnaround time possible.

We hear of many companies that are taking chances on producing an order for a new customer without doing thorough credit checks and then learning 30 to 60 days later why the customer was shopping — because they were not paying their previous supplier. The monthly report of past due accounts that WPMA distributes to participating members has shown a 157 percent increase within the last year of delinquent accounts reported.

WD: What trends do you see looming on the horizon?

Bibeau: The latest trend that members are experiencing is the demand for “green” or certified products and the effect on their business. There are many different opinions on the validity or need for certified products, but the bottom line is companies are starting to realize if they are not able to provide customers with this type of product, their competitors will. To help answer the many questions that members have on this issue, we have posted a “green”/certified/LEED section on our website and will be highlighting this as part of our annual meeting.

WD: What are some of the projects WPMA is working on to better serve its members?

Bibeau: Our staff has over 66 years of industry experience and understands the needs of its members. With profit margins being extremely thin, companies continue to look to WPMA’s Profit through Association Programs to help them improve their bottom line.

We are extremely proud to announce a long-term partnership with Indiana Lumbermens Mutual Insurance Company (ILM) to provide our members with a business insurance safety group program. This program offers companies extremely competitive pricing, excellent coverages and the potential for cash dividend payments. The program has grown tremendously well due to the fact that companies can access this special program through their current insurance agent. Many companies tell us that they have experienced substantial benefits from this program.