Many of you have probably heard about the proposed Hardwood âcheck-offâ program recently announced at the Indiana hardwood meeting.
Check-off programs are based on a federal law that allows the members of a given industry (typically a commodity industry) to decide by vote to assess themselves an annual dollar amount based on their production or sales. This money goes into a fund that an industry elected board decides how to spend, typically on promotion / advertising and research.
I wonât go through the details of the proposed program (they are available in several other places), but I would like to comment on why I think the check-off program is the right idea for our industry.
First, the program has been successful and has a proven track record in other industries. The cotton, chicken, pork, beef and avocado industries are all examples of commodity industries that have adopted this program. Iâm quite certain that youâve seen some of their advertising and branding efforts on television. None of us as individual hardwood companies could come close to funding these kind of promotion programs, but as a whole industry working together we can. Around 200 industries have adopted a check-off program, and well over 95% of them have chosen to stay with it, even though the law contains a provision giving industry members the right to vote to discontinue the program every few years.
Second, although I expect promotion will be the main focus of the program, the check-off system may allow our industry to do some research that no one company could afford to do on its own. Fortune 500 companies like 3M and Dunlop spend hundreds of millions of dollars researching issues affecting their industries. In their case, this is primarily in the area of product development. In our industry, some additional research devoted to environmental and sustainability issues might be helpful. This is something the industry board could decide to spend some of the check-off funds on if it so chose.
Make sure you educate yourself on the proposed hardwood check-off program. I believe the more you find out about it, the more you will like it.
Jeff Meyer is president and CEO of Baillie Lumber Co., a manufacturer, wholesaler and distributor of hardwood lumber and flooring based in Hamburg, NY. Meyer has a law degreee from Harvard Law School and has served on numerous boards of non-profit organizations including the National Hardwood Lumber Association and the Hardwood Manufacturers Assn.
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