In the high-end casegoods market, losing one or two expected projects can have a significant impact on a company's yearly revenues, according to John Kingsley, president of Valley City Manufacturing Co. Ltd. In the case of the Dundas, Ontario-based manufacturer, 2003 was one of those years.
However, in 2004 Valley City made up for their 2003 losses by snagging snagging a couple of projects that translated into a sizable increase in its 2004 total sales.
Valley City focuses on laboratory, courthouse and worship furniture. According to Kingsley, laboratories can be especially high-dollar jobs particularly those affiliated with universities because the quality of the laboratory environment is often used to assist in recruiting doctors.
"If the institution uses really nice woods, different species, finishes and interesting designs, it can have a good result in recruiting," Kingsley says.
"The thinking is, The doctor brings the research money and the grants, so if I spend a bit more on the furniture and give him the environment he's looking for he might come.'"
Kingsley notes that the general environment for high-end casegoods is difficult. Trades purchased in advance of casework are consuming more and more of an institution's budget, which leaves less funding available when it comes time to order casework.
In addition, the K-12 casework market is a little soft, so companies that traditionally work exclusively in that market are beginning to look at the institutional casegoods market as an area to move into until the K-12 market rebounds.
Also, companies that have both metal and wood divisions are getting more aggressive in their wood divisions as they experience temporary slumps in demand for metal products. "We're having to watch these companies," Kingsley says.
A growing niche
Valley City is growing steadily in its other markets worship and courthouse furniture. Kingsley sees this demand as being fueled primarily by the U.S. "The U.S market is so robust, so vibrant and so full of opportunity. The Canadian market is little bit tighter, budget-wise. We still participate in the Catholic market up here, but primarily we're looking to the United States. We're very much a small player in this market, which works well for us as we don't want to upset the bigger companies. We kind of go beneath the radar screen," Kingsley says.
Valley City targets customers that want a custom approach to worship furniture. "If someone wants something a little different than what they can get from a catalog, then we go after them. That's where our growth is coming from," Kingsley says.
Other types of institutional seating are becoming a staple in the Valley City portfolio as well. "A pew for a church is not that different from public seating or jury seating in a courthouse, and we're picking up nicely in the courthouses," Kingsley adds. "We don't want to double our business, we just want to add a little piece each year."
Customer type plays a role in Valley City's marketing pursuits as well. "We're about having some fun and working for clients that really like what we do," Kingsley says.
He is optimistic for 2005 and expects sales to stay at their current level.
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