The U.S. government has finally decided we’re in a recession — but don’t let the woodworking community hear that.

A recent survey of our Woodworking VIP panel, an online community of readers that act as advisors to this magazine, found that approximately 60 percent are optimistic that 2009 sales would meet or exceed those of 2008. Although hopes are slim for an immediate economic recovery, 20 percent of those surveyed predict an upturn by the second quarter, while another 21 percent see a market uptick happening in the third quarter of 2009.

This survey gives a good snapshot of the woodworking industry as a whole. The 165 respondents represent all major product segments, including: cabinets, architectural woodwork, furniture, millwork, store fixtures and components. Sales for these companies ranged from $50,000 to $20 million annually.

This also jives with information gleaned from our WOOD 100 survey back in September. Of the WOOD 100 executives surveyed, 85 percent said their sales expectations for 2009 were good to excellent, while only 2 percent predicted a poor year for sales.

Customer service goes a long way toward keeping business in a down economy, a fact reported not only by the WOOD 100, but by the Woodworking VIPs as well.

“We are working on a better profit margin on jobs, and keeping up good customer service,” said one executive of a $1 million-plus cabinet shop. “Word of mouth will go a long way in a slower economy.”

“We’re developing enhanced distribution to service our dealers with additional logistics support and just-in-time inventories for smaller jobs,” commented a marketing/sales executive from a multi-million dollar millwork firm.

Investing in the Future

Wood & Wood Products Columnist Tom Dossenbach has oftentimes preached to readers of the necessity to invest in their companies lest they stagnate and die. (Visit iswonline.com for past Management Matters columns.)

The majority of VIP panelists surveyed are in complete agreement. An estimated 27 percent say they plan to purchase additional equipment or upgrade their production lines in 2009, while another 38 percent say they would if the economy showed signs of improvement. On the wish list of these executives are CNC equipment, followed by sanding equipment and saws. Additional categories include: panel processing equipment including edgebanders and boring machines, solid wood machinery such as moulders, shapers and planers, and dust collection equipment. Upgrades to finishing lines to make them more environmentally friendly also garnered some mention by the panel.

Revamping of the finishing area has become a necessity for many companies, particularly in the past couple of years, with much of the impetus being driven by environmental regulations as well as consumer demand for green products.

This month’s State of the Industry report, “Sustainability Pushes an Evolution in Finishing,” focuses on that very theme. For the report, Associate Editors Wade Vonasek and Matt Warnock interviewed industry leaders, focusing not only on how improvements in the finishing area have resulted in a reduction of VOC emissions — in one case by more than 80 percent — but on how they also have led to improvements in quality and increased capacity, while reducing production time.

What Will You Do to Ensure Your Company’s Growth?

Companies such as those spotlighted in our State of the Industry report — Steelcase, Kent Moore Cabinets and Canyon Creek — have taken the steps needed to grow their company in 2009 and beyond. Our December Industry Trendsetter, Mortensen Woodwork, is another example of a company which has positioned itself to sustain the economic downturn. Mortensen Woodwork CEO Fred Mortensen attributes the company’s market diversity, sustainable initiatives and willingness to invest in technology as chief among the company’s drive for future success.

What will be driving your success in 2009 and beyond? Does your company have plans in place to succeed in these tough economic times?

When asked if their company would make changes in facing the economic challenges, well over half of those surveyed in our Woodworking VIP panel said they would.

The most popular responses by the panelists were to add a new product line or category, increase their marketing efforts to include new customer groups and expand their geographical markets.

Will you be willing to make changes?