Below are additional comments from Phil Bibeau, executive director of the Wood Products Manufacturers Assn., in response to questions posed on the state of the wood components industry.

Wood & Wood Products: Overall, how do your members’ sales from the last 12 months compare to the previous 12 months? What is your members’ sales forecast for the next 12 months?

Phil Bibeau: The majority of members have stated that sales for 2010 were at or above 2009 levels, and most felt positive about business going forward. The overall consensus was that business has bottomed out and there will be a very slow and gradual increase in business in 2011, especially in the second half of the year.

W&WP: What are the biggest challenges to your members and your industry in 2011? What are the biggest opportunities for your members and your industry in 2011?

Bibeau: The biggest challenges businesses are facing is the difficulty in generating new and profitable business, increasing business from their existing customers, and the challenges of obtaining or maintaining credit from financial institutions. Much of this is fueled by the fact that the wood industry is not the most sought after type of business that lenders are interested in.

Another set of challenges that businesses are starting to mention are the new regulations coming down from Washington. These include health care reform, the new 1099 reporting regulation, and increased enforcement by the EPA and OSHA. As one member stated, “It would be good if Washington got a clue and understood the ramifications of their actions on the wood products industry.”

The biggest opportunities that members will see in 2011 will be for niche products that can be delivered in small quantities with extremely short lead times. Companies will see opportunities in the marketing and special promotions side of the business. Large companies such as insurance, finance, and automobiles have started ramping up their spending. This is often an overlooked area for wood products manufacturers.

W&WP: What do you think it will take for your members’ companies to have success in 2011?

Bibeau: The companies that have become as lean as possible and have been frugal with their expenditures and accumulated cash will have the greatest opportunity to be successful as business slowly rebounds. Companies must constantly be thinking “out of the box” in terms of the types of products they can/will manufacture. Companies can not sit back on their laurels and produce the same items they have made for years. They must constantly be evolving and offering new products into the marketplace, which may not be in the woodworking arena.

W&WP: Any other comments or important information you would like to share in regards to the state of the woodworking industry?

Bibeau: Successful companies have started to focus on employee training and retention. As business continues to pick up, many employees that have been “biding their time until something better comes along,” will start to look for new employment. Most companies have cut their workforce to the bone to survive. Employers should ask themselves how they would function if they suddenly received notices from some key employees that have found other employment and were leaving your company.

Not only will they be faced with the possibility of hiring key employees (as orders are picking up), but these new employees must now be trained, which can be extremely expensive in terms of lost productivity. The time to start thinking about this is now.