Wood industry representatives from various industry associations were queried on the climate of their wood products market, including expectations for 2013 sales. Below are some additional comments by Dick Titus, executive director of the Kitchen Cabinet Manufacturers Association.
Wood & Wood Products: Overall, what are your members’ sales expectations for 2013 and how do they compare to 2012 figures?
Dick Titus: KCMA members closed out 2012 on a positive note for the first time in six years. Positive growth was reported each month beginning in January 2012 (+1.6% over January 2011) and continuing through November (+15% over November 2011) with +6.5% for the year. December results will be available later in January.
Expectations for 2013 are positive as the economy continues to gradually improve. The slow improvement in the health of the housing industry is expected to continue, barring a drop in consumer confidence, lack of leadership from Washington and repeat of the debt ceiling crisis, or irreconcilable disagreements on tax reform and need for reduced government spending. Home prices continue to improve, mortgage rates remain low, housing inventory is reduced, and demand for housing continues to increase. Kitchen repair and remodeling also continue to improve.
W&WP: What will be the biggest challenges to your members and your industry in 2013? What are the biggest opportunities?
Titus: The biggest challenges for KCMA members revolve around efforts to get the U.S. economic house in order, encourage economic growth and job creation, and provide relief from a regulatory system that stifles entrepreneurship and often punishes U.S. manufacturers facing increasing global competition. The biggest opportunity for KCMA members remains their ability to quickly respond to market changes with new and varied products, increased productivity, and emphasizing customer service 24/7. The association continues to strengthen the U.S. cabinet performance standard, ANSI/KCMA 161.1-2012, to accommodate changed technology and demands of the marketplace. This in turn helps create more consumer/specifier awareness and demand for KCMA “certified” cabinets.
W&WP: Launched in 2006, the KCMA’s Environmental Stewardship Program stands as a benchmark for cabinets under the NAHBV Green Building Standard. Is the demand for green/sustainable products reaching a plateau or do you see it continuing to grow?
Titus: The KCMA’s Environmental Stewardship Program (ESP) continues to grow. ESP was carefully reviewed this year and found to be in compliance with FTC Green Guidelines released late in 2012. The FTC even adopted some KCMA suggestions as part of the final guideline.
Largely due to the economy, the demand for “green”/sustainable cabinets has not increased appreciably, but with renewed consumer awareness and government procurement emphasis on environmentally preferable products, continued growth in the demand for such products is expected.
The association has implemented membership guidelines that assure that members’ cabinets are made in North America. There is growing interest on the part of many consumers for such products.
W&WP: What current or pending legislation is having, or will have, the greatest impact on the North American cabinet industry and why?
Titus: Clearly, government action to put the nation’s economy on sound footing is the top priority in 2013. Tax reform will be a difficult and contentious process. Congressional ratings are unlikely to improve and could decline even further in the upcoming fights over priorities and programs as politicians choose winners and losers. Progress has been made on several important regulatory issues, including boiler MACT regulations, utilization of sound science in assessing the risk to human health and the environment from materials used to make cabinets, wood dust regulations, and employee health and safety regulations. KCMA supported legislation to amend the Lacey Act and control illegal logging and now is engaged in the process to develop realistic enforcement requirements.
Not to be forgotten in the debates to come is the great environmental story wood has as a renewable and sustainable building material that remains the first choice of the majority of consumers. The U.S. forest products industry creates millions of good jobs and remains an industry sector that includes thousands of small entrepreneurial companies who take great pride in their work, their community and their country. The challenges facing the industry as the difficult task of reducing profligate government spending moves forward are many.
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