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U.S. Customs cracks down on hardwood plywood tariff evaders

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WASHINGTON — U.S. Customs and Border Protection is cracking down on attempts to evade antidumping and countervailing duties on hardwood plywood products imported from China.

CBP's twitter feed last month noted the agency's success in rooting out merchandise misclassified as ready-to-assemble kitchen cabinetry instead of the hardwood plywood panels actually contained in the cargo.

According to Alexander Amdur, director, AD/CVD Policy and Programs Division, U.S. Customs and Border Protection, evasions  generally fall into three categories: misclassification — misclassifying entries as something that’s not subject to AD/CVD; undervaluation — undervaluing the entry so as to not pay the right amount of duties; and trans-shipments  — hiding/misidentifying the country of origin on the shipment.

"The issue of antidumping and countervailing duties is extremely important to U.S. Customs and Border Protection, not just on the plywood issue but on the well over 400 cases that we enforce," said John Leonard, executive director - Trade Policy & Programs, U.S. Customs and Border Protection. "Together with the Department of Commerce, we're making sure that we collect the right duty on these shipments in order to level the playing field."

Since the final orders were issued, antidumping margins of 183 percent and countervailing duties of 23 percent and higher have been levied on shipments of hardwood plywood from China. The hardwood and decorative plywood panels are used in the manufacture of cabinetry, furniture and other products.

A representative from one domestic cabinet manufacturer said that his company ceased using imported hardwood plywood due to the tariffs, and has been heavily impacted by the competitive advantage others have gained in the "illegal" importation of the product. The crackdown at the ports on illegal shipments and enforcement of the tariffs by CBP "is going to have a major impact on the industry," he added.

There are more than 300 ports of entry where cargo and people can enter the United States, approximately 60 of which are larger, commercial ports for large container shipments. While the majority of importers are compliant with regard to applying and reporting duties correctly, "there are unfortunately a significant amount of trade evasions that we're enforcing against," Amdur said.

"AD/CVD is a priority for CBP," he added. "Importers need to be very careful in their importation and do due diligence, and review all of the Department of Commerce instructions to make sure that they’re importing the goods correctly."

All shipments entering the United States are screened, with high-risk entries identified through a combination of risk management methods and automated systems at the port levels and by CBP's 10 Centers of Excellence and Expertise, which are staffed virtually by import specialists. Hardwood plywood falls under the Industrial & Manufacturing Materials Center, while cabinetry, for example, is processed through the Consumer Products & Mass Merchandising Center.

"When anomalies pop, either by our targeting algorithms or by human intervention," Leonard explained, "[CBP] will segregate it out and look at it for further action," such as opening the container, a costly, and time-consuming procedure for the importer. Both civil and criminal penalties can occur if importers are caught evading.

The hardwood plywood import issue dates back to 2012 when the Coalition for Fair Trade of Hardwood Plywood filed an unfair trade petition against China for "products sold in the United States at dumped prices." The petition was opposed by the American Alliance of Hardwood Plywood, which claimed the countervailing ruling would not only penalize jobs, but "severely damage American industries that depend on this unique hardwood plywood." In late 2017, the Department of Commerce and International Trade Administration determined that the domestic industry was materially injured by the lower-cost, subsidized Chinese imports.

The AD/CVD order covers all hardwood plywood from China, regardless of whether or not the face and/or back veneers are surface coated or covered. Hardwood plywood which has had minor processing is also subject to the tariff; minor processing can include cut-to-size, painted, laminated, stained, UV finished, grooved, and/or edgebanded.

Currently excluded from the scope are: structural plywood; multilayered wood flooring, as described in the antidumping duty and countervailing duty orders on Multilayered Wood Flooring; shaped plywood; fully assembled wooden furniture; RTA furniture; and assembled and RTA kitchen cabinets, which are now facing their own scrutiny. To meet the RTA exclusion, the product must be shipped with all the materials specified in the exclusion and must be packaged in a manner suitable for purchase by an end-use consumer, in a single package.

On March 26 the U.S. Department of Commerce initiated an antidumping duty and countervailing duty investigation on wooden cabinetry and vanities imported from China to determine whether they are being unfairly subsidized and dumped in the U.S. market. Filed by the American Kitchen Cabinet Alliance, the petition covers cabinets made of solid wood as well as composite panel construction, RTA cabinetry, cabinetry components including doors, drawers, back and end panels, as well as desks, shelves, and tables that are attached to or incorporated in the merchandise.

For information on AD/CVD cases and the U.S. Customs and Border Protection visit cbp.gov/trade; or cbp.gov/trade/priority-issues/adcvd.


Exploring opportunities with cabinet sales qualified leads

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To understand the topic we’re covering today, let's talk about what an SQL is. SQL stands for Sales Qualified Lead, which is a contact which has the ability to be sold to and is possibly interested in purchasing your product.On the other hand, a marketing qualified lead or MQL is a lead that is either accessing some of your marketing materials or checking out your content but hasn’t taken the next step in displaying interest.
So we want to take those MQL’s and turn them into sales qualified leads. Let’s learn how to explore opportunities with cabinet SQLs.
 
LEARNING MORE ABOUT THE LEAD
 
This phase of the selling funnel is when you want to turn the heat up a little bit and try to move them more toward the decision portion of the funnel. So they’re still in the consideration phase and you are helping them move to the decision.
 
While we’re exploring the opportunities we are learning more about each other. Details about their company and how it interacts with our company are key here. But we’re still not asking too much out of them at this point. Basically, we are setting up a foundation to work from so that we can move them down the funnel which is more of the planning session.
 
In our funnel, when someone becomes a sales contact lead, we try to make contact with them on at least a weekly basis. By contact I mean any of the following: email, sending a new resource, a phone call, etc. Whatever method you need to use to keep reminding them that you are interested in their business is what you should be doing.
 
In my opinion most sales people neglect the follow up portion of selling. If they don’t receive the initial sale, they just begin to move on. But, I do realize that the SQL part is the hardest area of the funnel because you’re on the fence of a new customer going back up the funnel or further down the funnel. As a result we want to keep the pressure on to move them down the funnel toward a sale.
 
Here’s a few steps to make that easier:
 
1. HAVE A ROUTINE
 
The best way to create a routine is to follow a standard operating procedure. You should have a specific and well thought out way that you treat every SQL that comes in. This does not have to be a robotic method where you’re unable to be flexible, but you should have a checklist of what you want to obtain during the expiration phase.
 
Basically, you want to obtain information about their company, you want to see what kinds of work they do (and you can even do a site visit as a point of contact for this), and you want to learn as much about the customer as you can. At the same time you want to start inputting what your strengths are as a company. So highlight how your strong suits would partner with your customer in whatever they’re undertaking currently.
 
At first you were just asking for the opportunity to contact them again. But at this point you should continue the relationship by letting them know more about what your company does.
 
2. HOW CAN YOU PARTNER FOR GROWTH?
 
This is a great way to get a lead in a different mindset. Instead of them thinking of you as being a ‘vendor’ or ‘salesman’ and themselves as a ‘customer’ you can be ‘partners in growth.’ This makes the conversation much easier to have because it becomes one between two friends and isn’t dominated by the normal salesman awkwardness. You want to build a foundation where both of you are partners and there is no hierarchy where one is ‘better’ than the other. From there you can set up strategies to grow each others companies and feed each other business.
 
In this phase we want to focus on sending decision based content, focusing on specifics about how you can partner. Start talking to them about lead times and payment terms, expectations after the sale as well as how you do your sales. Explain your process and turn around times so that they know all of these things during the conversation and it’s not something that you have to go over again later. Doing this will also let you know how serious they are about becoming a customer.
 
Later, we will will move from exploration to planning, which is a small step but is a major part of closing the sale.
 
Jeff Finney is the founder of Ultimate Cabinet Components, based in Collinsville, Oklahoma; 918-371-7171. For more shop insights from Jeff, check out his articles at UltCab.com or listen to his podcasts at thepushthru.com. Jeff is also a 2018 40 Under 40 honoree. Download Jeff’s booklet, 5 Steps to Hiring Better Employees for Your Cabinet Shop at UltCab.com.

Rehau adds floating shelves to cabinet door line

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LEESBURG, Va. – Rehau added floating shelves, with patent-pending concealed mounting brackets, to its modern custom cabinet door line. The shelves are available in high-gloss, matte and textured woodgrain.
 
“Whether the goal is simply to clear clutter or to spark joy, providing ample storage is a vital function of interior design,” said Jesse Collins, marketing manager with Rehau’s furniture solutions division. “Our new floating shelves are an elegant way to expand storage for everything from dishes and small appliances to decorative objects, while complementing the clean, no-hardware design of modern European-style cabinets.”
 
According to the company, the shelves have a storage capacity up to 15 pounds per linear foot and are finished with matched edgebanding, enhancing durability and visual appeal. Manufactured with 3/4 inch (19 mm) MDF core, the 2-3/8 inch (60.3 mm) thick shelves are offered in depths of 10 and 12 inches (254 and 304.8 mm) and custom, made-to-order lengths from 22 to 96 inches (558.8 to 2438.4 mm).  
 
Learn more at  na.rehau.com/shelves.
 

ITC preliminary investigation finds U.S. cabinetmakers harmed by Chinese imports

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WASHINGTON - In a 4-0 vote, the U.S. International Trade Commission has determined that "there is a reasonable indication" that American cabinetry manufacturers are being harmed by Chinese imports of wooden cabinets and vanities.

Announced April 19, the preliminary determination by the USITC paves the way for the U.S. Department of Commerce to continue its antidumping and countervailing investigations into whether Chinese wooden cabinets, vanities and components are unfairly subsidized and sold in the U.S. market at less than fair value. The DOC will make its preliminary countervailing duty determination on or about May 30,  and its preliminary antidumping duty determination on or about Aug.13. (Investigation Nos. 701-TA-620 and 731-TA-1445 - Preliminary)

The investigations stem from a March 6 petition by the American Kitchen Cabinet Alliance which claimed China's "manipulation and unfair trade practices" have led to a more than 75 percent rise in Chinese imports of kitchen and bath cabinetry in the last few years. In 2018, imports of wooden cabinets and vanities from China were valued at approximately $4.4 billion, almost half of the estimated $9.6 billion American market.

The scope of the petition covers both face-frame and frameless cabinets, made of solid wood and composite panel construction, RTA cabinetry, cabinetry components including doors, drawers, back and end panels, as well as desks, shelves, and tables that are attached to or incorporated in the merchandise. (Click on the link for the DOC fact sheet.)

Excluded from the petition are products already covered under the hardwood plywood or wooden bedroom furniture antidumping duty orders, as well as aftermarket accessory items if imported separately from the wooden cabinet or vanity, including: drawer organization inserts or dividers (straight, round or oblong); carved wooden accessories including corbels and rosettes; and non-wooden cabinet hardware components, including metal hinges, brackets, catches, locks, drawer slides, fasteners, handles, and knobs.

“[The April 19] preliminary vote is an important first step in our long fight against China,” said John Gahm, vice president of manufacturing at Kitchen Kompact. “Our aim through the AKCA is to stand up for the more than 250,000 American workers employed in the kitchen cabinet industry. Our trade case will help us combat Chinese dumping and subsidies and level the playing field for American workers and their families. We will continue to fight to preserve and strengthen this industry.”

“The preliminary injury vote reaffirms that the ITC is taking this case seriously and underscores our assertion that China is using illegal trade practices in its effort to capture global production of wooden cabinets and vanities,” added Tim Brightbill, chief counsel for the AKCA and a partner at Wiley Rein.The AKCA is comprised of more than 45 companies based across the United States.

A coalition is currently being formed to represent the cabinetry importers impacted by the petition.

Among the importers affected is Kitchen Cabinet Distributors. Randy Goldstein, CEO of the North Carolina-based company, commented, "This is not a typical China [antidumping] case. The largest players in the U.S. domestic industry have relied heavily on imported Chinese components for decades, and they're only now in the process of shifting this production to other countries, such as Vietnam and Mexico not the United States. The notion that going after Chinese imports is going to somehow directly result in U.S. manufacturing jobs is belied by the very public actions that the largest domestic manufacturers have undertaken."

As to the AKCA's claims that the Chinese government is subsidizing its manufacturers, enabling the imported cabinets to be priced much lower, Goldstein countered,  "If you look at the data, the lowest priced cabinets in the U.S. market are not coming from importers, but instead they're coming from domestic producers."

He added, "I've spoken to many of my peers at other established import cabinet companies, and we all consistently lost bids to domestic players who are able to under-price us in the market," while also better able to meet the custom requirements demanded by a majority of consumers in regard to size, color and finish. "I also think it's important to note that this is a market where purchasing decisions are made based on many factors beyond price."

Goldstein also said that unlike other domestic industries found by the DOC to have been harmed by Chinese imports, "The domestic cabinet industry as a whole continues to achieve record levels of sales and profitability. The idea that imports which represent less than 10 percent of the industry and serve a highly limited market are causing material harm to the domestic industry or to U.S. manufacturing jobs is preposterous." He added that RTA importers directly employ tens of thousands of Americans, in addition to those employed in downstream roles.

The next preliminary determination date is May 30, with final determination dates to follow. (See chart below).

If the DOC makes an affirmative finding in the investigations, and if the USITC determines that dumped and/or unfairly subsidized Chinese imports of wooden cabinets and vanities are causing injury to domestic manufacturers, duties would be imposed on the imports and the U.S. Customs and Border Protection would begin collecting cash deposits from companies importing the products.

The alleged dumping margins for China range from 177.36 to 262.18 percent, according to the DOC. There are 36 subsidy programs alleged in the China countervailing duty investigation, including a provision of goods for less than adequate remuneration, loan programs, grant programs, tax programs, and export subsidy programs.

Below is a schedule of the process:

EventCVD InvestigationAD Investigation
Petitions filedMarch 6, 2019March 6, 2019
DOC initiation dateMarch 26, 2019March 26, 2019
ITC preliminary determinations (announced April 19)April 22, 2019April 22, 2019
DOC preliminary determinationsMay 30, 2019Aug. 31, 2019
DOC final determinationsAug. 13, 2019Oct. 28, 2019
ITC final determinations**Sept. 27, 2019Dec. 12, 2019
Issuance of orders***Oct. 4, 2019Dec. 19, 2019

**This will take place only in the event of final affirmative determinations from Commerce.
***This will take place only in the event of final affirmative determinations from Commerce and the ITC.  
Where the deadline falls on a weekend/holiday, the appropriate date is the next business day

Hettich Canada launches new online shop

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MONTREAL, Quebec– Hettich Canada announced the launch of its new online shop on the Hettich Canada website. The new e-commerce platform will provide customers with a new interface to find and view products, drawings of product selections and product variations.

The online shop allows for live transactions to be made and is functional on mobile devices and tablets. Hettich Canada initially created a new e-shop in February 2018. Their e-shop is the first platform at Hettich where orders can be made directly online by registered customers.

Previously, product orders were made by contacting the Hettich Canada customer service team directly. See http://www.hettich.com.

Wood-Mode shutters cabinet operations

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KREAMER, Penn. - One of the nation's oldest cabinet manufacturers has shuttered its doors.

Wood-Mode told its estimated 1,000 employees on Monday that it will cease production. In a letter provided to Fox56 by a Wood-Mode employee, the company said it had been "seeking financing and other alternatives, including new capital and a possible sale transaction that would have enabled it to continue operations." The company said it learned last week that a potential buyout had fallen through and that its lender was unwilling to provide additional funding.

The hand-delivered letter to employees said it was to serve as a written notice pursuant to the Worker Adjustment Retraining Notification (WARN) Act.

Administration employees were laid off Monday, May 13, and production employees will be laid off in phases, beginning May 14 through May 24. The company said it will pay accrued wages and agreed-upon fringe benefits to the laid-off employees.

In its statement Wood-Mode also said, "After 77 years of business, the company and ownership truly regret the impact of this action to our employees, the community, and our loyal customers and suppliers.  We are extremely appreciative of everyone’s commitment and service to Wood-Mode throughout the years."

An aerial view of the plant

Just two months ago, the company had shot down rumors of a possible sale or closure, with David Scarr, vice president of Human Resources, telling The Daily Item"there is no truth to the rumor."

Wood-Mode was listed among the top 10 cabinet companies in the latest FDMC 300, a listing of the top North American wood products manufacturers. The company produced semi-custom and custom frameless and frame cabinetry, under the Wood-Mode and Brookhaven brands.

Founded in 1942 by T.O. Gronlund, C.G. Wall, R.E. Nellis and Cas Holloway, Wood-Mode (then known as Wood-Metal) produced wood and steel cabinetry until the war forced a change. From those beginnings, the company grew significantly, and just two years ago was producing an estimated 700 to 800 frame and frameless custom cabinets a day at the 1.3 million-square-foot plant.

Wood-Mode was also known for being one of the first U.S. adopters of the 32mm system for producing cabinetry, and had been manufacturing frameless style cabinetry since the early 1980s. The company was also a founding member of the Kitchen Cabinet Manufacturers Association, and one of the first in the United States to utilize RTO (regenerative thermal oxidizer) technology for controlling VOCs at its plant.

Robert Gronlund, chairman and CEO, was named a Wood Industry Market Leader in 2012 by Woodworking Network.

U.S. distributor coalition set to fight trade case on RTA cabinetry imports

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Washington, DC -  A coalition has been launched to fight the recent unfair trade allegations against ready-to-assemble cabinetry imports from China.

The formation of the  American Coalition of Cabinet Distributors (ACCD), a group made up of U.S. distributors, dealers, contractors, installers and importers, was in direct response to the antidumping and countervailing petition filed March 6 by the American Kitchen Cabinet Coalition. The petition alleges theChinese government's "manipulation and unfair trade practices" have led to a more than 75 percent rise in Chinese imports of kitchen and bath cabinetry since 2015, and created a threat to the $9.5 billion American industry.

According to its website, AmericanCabinetDistributors.org, the small and medium-sized businesses represented by ACCD represent less than 10 percent of the U.S. domestic cabinet industry sales, while employing tens of thousands of American workers. 

“The made-to-order cabinet manufacturers that filed this trade case are seeking to wipe out the RTA market segment by taking advantage of anti-China trade sentiment,” said ACCD member Randy Goldstein, CEO of Kitchen Cabinet Distributors in Raleigh, North Carolina.  “For weeks, we have seen these petitioners spread lies about the RTA segment of the industry, a segment that actually complements U.S. production and enhances the overall cabinet market.  Small- and medium-sized businesses throughout the United States that rely on RTA imports have formed this coalition to fight back against the false narrative peddled by the petitioners.  We will make sure that policymakers, elected officials and the public understand the facts of this case and the damage that duties would have on businesses such as remodelers and builders across the country, as well as on American homeowners.”

The ACCD claims imposition of the proposed duties could effectively eliminate the RTA option from the U.S. marketplace.  “The imported RTA sector makes up a small portion of the U.S. cabinet market,” said Coalition member Missy O’Daniel, president of Web-Don Inc. in Charlotte, North Carolina.  “Domestic producers dominate the market.  Our success has done nothing to impede the growth of the larger U.S. kitchen cabinet industry, which continues to prosper today.  In fact, made-to-order cabinet producers have steadily increased their prices and shipment volumes over the past several years—hardly a sign of industry malaise.”

The scope of the petition covers both face-frame and frameless cabinets, made of solid wood and composite panel construction, RTA cabinetry, cabinetry components including doors, drawers, back and end panels, as well as desks, shelves, and tables that are attached to or incorporated in the merchandise. (Click on the link for the DOC fact sheet.) Excluded from the petition are products already covered under the hardwood plywood or wooden bedroom furniture antidumping duty orders, as well as aftermarket accessory items if imported separately from the wooden cabinet or vanity, including: drawer organization inserts or dividers (straight, round or oblong); carved wooden accessories including corbels and rosettes; and non-wooden cabinet hardware components, including metal hinges, brackets, catches, locks, drawer slides, fasteners, handles, and knobs.

Although an April 19 preliminary vote by the ITC determined that "there is a reasonable indication" that American cabinetry manufacturers are being harmed by Chinese imports of wooden cabinets and vanities, the ACCD said it is "encouraged" by the commission's views on the industry. "Although the ITC decided to proceed with the investigation, it found that imports have not had a negative impact on the U.S. cabinet industry’s prices.  This finding supports the ACCD’s position that any difficulty some members of the U.S. made-to-order cabinet industry are experiencing is tied to home-grown factors, including intra-industry competition, consolidation and failure to adapt to evolving market needs.  Given that import duties would have a significant, harmful impact on workers and businesses across the United States and would hurt American consumers who benefit from access to the broadest array of cabinet choices possible, the Coalition urges the ITC to continue to subject the petitioners’ self-serving assertions to the most careful scrutiny," a statement from the group said.

JSI Cabinetry is one of the members of the new American Coalition of Cabinet Distributors

“Our customers come to us for speed, service, reliability and quality,” said ACCD member Chris Graff, executive vice president of JSI Cabinetry in Fall River, Massachusetts.   “We provide exceptional quality in a narrow product assortment enabling delivery in days.  The flexibility to order RTA makes for easy, fast and damage-free delivery from our facility to the kitchen, whether it’s for a single-family home, apartment or multi-unit complex.  This timeline contrasts with made-to-order manufacturers that can take one or even two months or more to deliver an order.  Some consumers and construction industry clients simply can’t wait that long for their kitchen cabinets.”

“The Coalition looks forward to presenting the facts of this case and showing the ITC that these petitioning companies have not been injured by imports of RTA cabinets from China,” said legal counsel Matthew Nicely, a partner at Hughes Hubbard & Reed.  “The source of any difficulty these companies face is right here in the United States, among their fellow U.S. competitors.  We’re not going to allow anti-China trade fever to stand in the way of a sober appraisal of marketplace realities.  We are counting on the ITC to recognize this petition for what it is and issue a negative injury determination during the final investigation that will commence later this year.”

There's no excuse for not selling more cabinet jobs

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To be successful, you have to have a laid-out process for your cabinet company to make sales. I’ve written about the idea of a sales funnel which consistently brings you new leads in the top and pours out new customers from the bottom. What we’ve learned is that sales is a continuous process. It’s not simply something that we do sporadically when we think that we need work. Another idea that we have explored is how Ultimate Cabinet Components can provide manufacturing stability through increasing your capacity with no capital investment.
 
Outsourcing increases sales
 
These ideas end with a specific call to action. There is no reason in today’s day and age, with outsourcing being as easy as it is, that you shouldn’t be taking advantage. With a few clicks you can order cabinet boxes online, or find resources that make it more efficient and easy to do our jobs. There’s just no excuse to have a hold up on your cabinet sales.
 
By following some of the simple steps of continuously interacting and communicating with your potential customers in order to close sales, you are going to set yourself apart from the rest of the competition. The majority of salespeople do not interact with their customers in a way that presents a partnership. There is never a win/win situation for the customer. Generally, it just involves a price and a schedule and that’s the end game.
 
How many more sales would you be able to get if you could increase your capacity by 50 percent with no additional capital investment into your business?
 
I bet the answer would be very staggering.
 
If you had nothing but more time to sell and create your own sales funnel process where you were converting leads into customers with no worries about manufacturing strain, you could easily get your product out the doors. Outsourcing has never been easier or quicker. With the ease of shipping it has never been more accessible than it is right now. Ask yourself that question “How much more sales could I close on, if I didn’t have to worry about capacity constraints?”
 
For most cabinet shops, capacity is the thing blocking an increase in sales. However, if they were able to outsource some or most of their manufacturing production, then some if not all of their effort could be put into doubling their business through sales.
 
The outsourcing challenge
 
I challenge you as a business owner to try and outsource 10 percent to 20 percent of your products. Visually gauge how you would go through this process. How easy would it be to order, receive, and assemble the cabinets. See if this would be a fit for your company and put some numbers to this process. Would it work for more of your business?
 
In other words, if you release some of the manufacturing strain and only had to receive the cabinet box components and assemble them on site, it should make your process much easier and at the end of the day it would reduce your risk and cost by a substantial amount. This would open up the doors for you to have time to sell more cabinets.
 
 
 
 
 
 

IKEA issues safety alert for Hemnes bookcases and cabinets

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CONSHOHOCKEN, Pa. - Home furnishings retailer IKEA released a safety announcement for its Hemnes bookcases and glass cabinets sold in U.S. stores and online from April 2010 to April 2017. 
 
According to the company, it received 29 global reports of injury due to shelves falling from the Hemnes units due to wood shrinkage. Seventeen of those reported incidents occurred in the U.S., resulting in minor cuts or bruises.
 
IKEA is offering longer shelf support pins for the cabinets free of charge. No proof of purchase is needed to obtain replacement pins. 
 
For more information, visit www.ikea.com.
 

New approach drives change for California cabinet manufacturer

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For most companies, getting away from the “old way” of doing things meant that something bad had to happen to make them rethink their position.

For Monschein Industries, Inc., 2013 was the year that rethinking began, according to Tim Donowick, director of operations. Monschein had just started recovering from the long recession and was under pressure to make more cabinets better and faster.

The Riverbank, California, company had many challenges including the morale in the company, which was on the low side, Donowick said. The company’s core people had not seen paid vacations or raises in a long time. Another obstacle was a not-so-complimentary reputation for poor on-time deliveries, less-than-acceptable product and slow and inadequate customer service.

Fortunately, the owner, Karen Monschein, a highly business capable, mechanically intuitive and strong-willed woman, was dedicated to improvement. She led a number of meetings, using data to determine what which changes should be made. They came up with a single word strategy: Velocity.

“We had to get our product through quickly and efficiently to our customers while working on changing our customer’s perception of us by putting the focus on our customer service,” Donowick said.

Monschein Industries is located in California’s San Joaquin Valley, east of the Bay Area. The company’s 265 employees manufacture kitchen and bath cabinets for local builders in a 133,000 square foot operation. The company was started in 1964 by Frank Monschein and moved to the present site in Riverbank in 1971. It has high capacity CNC equipment, automated finishing, stone processing capability and has grown rapidly over the past four years.

 

Areas for improvement

“We started at the beginning of our processes to review everything we did and asked, Why?” Donowick said. “Why did we do things the way we did and how could we do it better and faster? What we did before was great and the company prospered but what we are doing now just wasn’t cutting it.”

Focusing on the welfare of Monschein’s core group of employees was a priority. The recession had reduced their labor pool, with many good people leaving the area for greener pastures outside California.

Karen Monschein knew they had to not only retain this well-trained core group but bolster the morale so the word would spread that Monschein was a great place to work for those who worked hard.

Raises were given to bring employees up to a level equal to the area’s standard rate and then increases given as people performed beyond expectations. Hard work was rewarded. They have a new large break room that features diner-type seating and an 82-inch television. Employees received sweatshirts, T-shirts and a large Christmas party.

 

Increasing velocity

Monschein looked at its entire operation, and identified processes that piled up work in process or were redundant. If they made a change, they looked at how it affected downstream processes.

“We looked into how to get our processes in a straight line and separated solid wood processing from panel processing,” Donowick said. “We would establish a mind set on specific types of machinery and processes making it easier for our personnel to understand and assist in the changes. Within this plan we added training and cross-training of our employees to such an extent that they became experts at their job and able to train others in the tasks.”

Monschein makes its own doors, drawer fronts, face frames and other solid wood parts from kiln dried lumber running it through the mill area. Boxes are made of ½-inch particleboard laminated with melamine impregnated paper.

Monschein needed more than 800 end panels per day and a lot of thinking went into setting up this process.

“We selected a Homag BHX-050 for its small footprint and its barcode reading ability and paired this with a reconfigured table saw mounted with a reverse dado blade and feeder unit,” Donowick said. “Now we could complete the end panel machining quickly and efficiently in a single step.”

In the wood processing area, Monschein had to address some of the lesser operations to fit into the straight-line methodology. Replacing older miter machines with a single CNC Accu-Systems MMTJ miter machine and using James L. Taylor’s eight-station Door Pro carousel clamp reduced the floor space required by half and increased productivity by as much as 40 percent, Donowick said. The doors would be ready for the next operation in less than 30 minutes instead of a three- to four-hour cycle time.

Previously, on door and drawer edge details the people would automatically pull out palm sanders and sand the end grain, so the company added a pair of Voorwood A517 semi-automatic edge detailers to do that work instead. Other machines were custom designed, such as a drawer front centering machine designed in house using components supplied by Hurst Engineering.

They also needed to reduce delay in getting finished end panels into the Cattinar for stain by adding a small Viet sander with platen head to cover all needs into the panel processing area. Biesse edgebanders and Hendrick vertical panel saw are also used.

In 2014, Monschein had 100 people on the production side producing 247 cabinets per average day. Today they have 125 production employees making more than 400 cabinets per single shift.

 

Finishing upgrades

Monschein had previously purchased a Cattinair automated stain line and a large four-booth UV finishing system from Superfici, but these machines were largely unused due to the way cabinets were manufactured at that time. Only doors and drawer fronts were stained and clear finished.

Then the company made a major change by rethinking the way they made kitchen and bath cabinets from fully assembling cabinets, taping off, masking and then hand finishing them, to pre-finishing components before assembly. This change improved velocity, reduced finishing labor and the variation of components used in the cabinets.

Staining multiple colors in the Cattinair requires only three people for daily production. These components are then moved to the Superfici UV flatline finishing system that requires seven people to complete more than 400 cabinets per day. Monschein increased velocity by more than six times over hand spraying in booths and reduced labor by 30 percent.

Donowick said the Superfici is set up with two sections. The first section does the clear sealer and topcoat, then components move to a crossover to be flipped 180 degrees. Then sealer and topcoat is applied to the face of the parts in the remaining two spray booths. It was found that only one section was required to complete all of the daily production needs.

Monschein also came up with the unusual idea of doing a pigmented UV finish since painted cabinets have become so popular. The new process was proposed that the UV itself be pigmented to match the most requested color of Designer White. Several companies were called in to discuss this idea and do trial runs with their existing materials. All these companies should be commended for their efforts, Donowick said. It took a total of 10 months to work out the bugs in the idea and successfully complete a single acceptable door.

“Another three weeks was required to flush the plant of the old process and introduce the new,” Donowick said. “When we were done we compared the old process to the new. We used to produce one to one-and-a-half kitchens per day via hand spraying. By introducing automated pigmented UV finish, we could average eight total kitchens per day. Since that time we have now matched paint finishes for Mission White, Ivory and Dove Grey for our UV machine.”

There are plans for even more changes and improvements but, even the best of companies sometimes need to stop and rest a bit, Donowick observed. The next moves include relocating the Viet sander and Quickwood sanding cell closer to the stain room, moving door assembly closer to the cutting area where it is now in a straight line with the rest of wood processing, building an updated centering fixture for drawer fronts, improving drawer slide installation with better hardware, and finding a way to make all MDF miter or cope-and-stick painted doors.

But Donowick will not be part of these future changes, as he retired in April and looks forward to teaching and other new challenges. “When times are good and revenue is rolling in by the truckload you don’t think of making improvements,” he said. “When change became infectious, each change increased output and, by giving employees the opportunity to shine and reward this effort, they brought new life and increased vitality.”

 

FACTS

Monschein Industries, Inc.

Riverbank, California

Products: Kitchen and bath cabinets for local builders

Employees: 265

Plant size: 133,000 square feet

http://www.monscheincabinets.com/

 

Playing it safely in California

As part of the Monschein Industries strategy of velocity and improving processes they had to ensure their employees stayed safe.

“We purchased machinery that had to include the best safeguards,” Tim Donowick, director of operations, said. “Our table saws were replaced with SawStop table saws, (and we) purchased upcut Ironwood saws included guarding that (kept) the operator’s hands away from the blade. We designed and installed fencing and machined Lexan guards to keep operators away from moving parts. Our people’s safety was paramount.”

In late 2013, CalOSHA had made multiple visits to the Riverbank location and reported multiple violations. Donowick said that these were small and not serious, but it showed them that the safety of their employees had to take precedence over production. Instituting policies and procedures to ensure the safety of employees was a large task in itself.

“Implementing programs to have our employees all wear safety glasses and ear protection, (have) yearly hearing tests, training employees on the simplest of safety precautions (such as not wearing jewelry or long sleeves when operating machinery), instituting monthly safety meetings and constant monitoring of guards in place became almost a full time job,” Donowick said. “We even had our liability and workman’s compensation insurance companies do quarterly inspections to ensure compliance with all rules and regulations.”

Today, they welcome Valley Air Pollution Control Board in to help them comply with new or updated regulations. The local Fire Marshall gave them a clean bill of health on his last visit. Many details in the California rules makes compliance challenging, but Donowick said they have to be prepared.

Shared workspace offers classes and access to machinery

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HARTFORD, Conn. -- Makerspace Connecticut (MakerSpaceCT) has opened its doors, offering 20,000 square feet of opportunities for shared working space and machines for woodworkers and other craftspeople.

Members join MakerspaceCT to unleash their inner creativity and build projects while using machinery at a fraction of the price that it would cost to purchase the same equipment new.

Many members are lifelong woodworkers who simply ran out of space in their personal shop and wanted to collaborate with other like-minded individuals.

MakersSpaceCT’s latest addition is from Safety Speed Manufacturing, a SR5UA vertical panel saw and router combination machine that allows members to use one machine with an interchangeable head for both sign-making and woodworking projects.

This is Connecticut’s largest makerspace and the third largest in New England, offering its members training on high tech CNC manufacturing equipment, additive manufacturing, CAD design, cabinet making, and digital sign-making.

MakerSpaceCT is a project of McEivr Inc., a 501(C)(3) community shop and skills training center nonprofit organization. They offer educational classes taught by industry professionals and access to industry leading machines. They film and edit custom-made safety videos allowing members to review their safety training using QR codes placed at each machine throughout the facility.

In 2018, MakerSpaceCT opened scholarship-funded classes in 3D printing and CAD design in its education center, while building out their commercial shop. These short-term, “high impact” classes, which they still offer, introduce career paths to those who might not otherwise have the opportunity.

For more information, visit Makerspacect.com

Virginia’s Custom Wood Products closed, auction coming

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ROANOKE, Va.– Custom Wood Products, a maker of custom kitchen cabinets and bath vanities, and outdoor cabinets, has reportedly closed and filed for bankruptcy.

According to the Better Business Bureau, the business filed for bankruptcy in late January under Chapter 7 (Liquidation) of the federal Bankruptcy Act, case #19-70115.

BBB advises those with monetary claims against the business to obtain a Proof of Claim form by writing to U.S. Bankruptcy Court/Virginia Western Bankruptcy, 210 Church Avenue, SW #200 Roanoke VA 24011 for resubmission to that court. The case number should be entered on the form.

The company was reported to be formed in 1969, and had 80 employees.

The company has been listed in recent years in the FDMC 300, https://www.woodworkingnetwork.com/fdmc-300

The company was ranked at 285 on this list of the 300 largest wood products manufacturers in North America, with annual sales estimated of $10 million in 2018. There were two manufacturing locations, both in Roanoke.

The company had also operated as Sugarloaf Cabinet Group, and had a division called New River Cabinetry.

An auction is being held June 10 by the Branford Group, and includes CNC machining centers, paint system, rolling stock, and facility support. Contact Andrew Duncan at 203-483-2226
aduncan@thebranfordgroup.com

Auction opens Monday, June 10, 2019 at 8 a.m. EDT; First lot begins to close: Wednesday, June 12, 2019 at 10 a.m. EDT.

See https://www.thebranfordgroup.com/DNN3/Auction/CUWO0619.aspx

 

Kitchen remodeling spending surged 27% in 2018

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PALO ALTO, Calif. - Spend in kitchen remodels, the most popular room to renovate, jumped 27 percent in the past year to a median spend of $14,000, according to the eighth annual Houzz & Home survey of more than 140,000 U.S. respondents. This follows a 10 percent increase in median kitchen spend in 2017. Median spend on guest and master bathroom remodels, the second and third most popular rooms to renovate, grew by 17 percent and 14 percent, respectively. 
 
“Last year's 10 percent increase in tariffs on imported building materials have started to hit consumer pockets in areas such as kitchen and bathroom remodels that are heavily dependent on imports of cabinetry, countertops, ceramic tile, plumbing fixtures and vinyl flooring from China. We expect similar effects to take place in 2019 given the recent breakdown in trade negotiations,” said Nino Sitchinava, Houzz principal economist.
 
Overall, renovation activity remained strong through 2018 with more than half of homeowners on Houzz remodeling (54 percent), at a median spend of $15,000. Similar to expectations from previous years, 51 percent of homeowners plan to continue or begin renovations this year at a median spend of $10,000, signifying that 2019 is on track to be another robust year for the home improvement market. 
 
As homeowners consider whether to renovate their current home or to purchase a new home, the top two considerations for renovating are location and ability to personalize, outranking return on investment. In fact, wanting to stay in the current home is the biggest decision driver for owners who have lived in their homes for six years or more (61 percent), while personalization is the most important factor for those who have lived in their homes for less than one year (56 percent). 
 
"Pent up demand continues to be the biggest trigger for renovations today, as older generations, who represent four in five renovating homeowners, prefer to stay put and invest in the design and functionality of their current home over moving to a different home," said Sitchinava. 
 
Baby Boomers (ages 55-74) and Gen Xers (ages 40-54) combined represent four of five renovating homeowners (81 percent), with a median spend of $15,000 each. Meanwhile, Millennial homeowners (ages 25-39) represent 14 percent of renovators, with a median spend of $10,000. Gen Zers (ages 18-24) entered the renovation market in 2018, accounting for a small share of renovating homeowners (0.3 percent) at a median spend of $7,000. While kitchens and guest bathrooms are universally popular across generations, age groups differ in their focus on the third most popular room to renovate. The master bathroom is favored by homeowners 55 and older, while the living room is prioritized by homeowners under 55. 
 
Local markets in flux
The national median renovation spend has remained consistent for the past three years. However, when considering the 10 highest-spending metros in 2017, seven saw a decline in median spend in 2018. San Jose, California, remains a leader in median home renovation spend despite its drop to $25,000 in 2018, from $30,000 in 2016 and 2017. Houston also experienced a significant decline in 2018 ($17,000) from 2017 ($24,000), though it has not dipped below the pre-hurricane median of $15,000 in 2016. 
 
Credit card financing continues to rise
The majority of homeowners pay for renovations using cash from savings, however the share of homeowners paying for renovations with a credit card continues to rise (37 percent in 2018 versus 33 percent in 2017). Reliance on credit cards and gifts or inheritance as funding sources is higher in younger generations (under 40), while secured home loans and past home sale proceeds are key for homeowners 40 and older. 
 
Finding the right professional for the job
Four in five renovating homeowners hired a professional in 2018 (87 percent), with general contractors in greatest demand (26 percent). While Baby Boomers are more likely to hire professional help than Millennials (89 versus 82 percent, respectively), the gap is surprisingly narrow. In fact, hiring of construction managers such as general contractors is nearly as widespread among Baby Boomers and Millennials (36 and 34 percent, respectively). 
 
Security in focus
Security upgrades continue to gain popularity, with an average annual growth of 20 percent over the past three years, and a median spend of $500 in 2018. Outdoor security also saw gains in popularity, growing 50 percent year over year to 12 percent in 2018, from nine percent in 2017. One in seven renovating homeowners integrated smart outdoor security cameras that can be monitored or controlled from a mobile device (14 percent). Home security is particularly popular among Millennials, who are more likely to upgrade their systems than Baby Boomers during renovations (24 versus 15 percent, respectively). 
 
Making “smart” decisions
One in four home renovations trigger the purchase of a home assistant. Other connected home purchases include smart light fixtures (17 percent), smart thermostats (15 percent), or smart alarms or detectors (13 percent), which can be monitored or controlled from a mobile device or computer. Millennials are more likely than Baby Boomers to rank smart technology as a high priority (31 versus 25 percent, respectively), and are twice as likely to install smart thermostats (24 versus 12 percent, respectively) during renovations.
 
The final touch
The majority of renovating homeowners in 2018 also decorated or furnished their home the same year (70 percent). Millennials were significantly more likely to decorate following home renovations than Baby Boomers (83 versus 65 percent), purchasing products such as large interior furniture and storage solutions.
 
The Houzz & Home Survey
 
The annual Houzz & Home survey is the largest survey of residential remodeling, building and decorating activity published. The survey covers a wide range of renovation projects in 2018, from interior remodels and additions to home systems, exterior upgrades and outdoor projects. Data gathered includes historical and planned spends, professional involvement, motivations and challenges behind building, renovation and decorating projects, as well as planned activities for 2019. The 2019 study includes more than 140,000 respondents in the U.S. alone, providing insights into the home improvement activity of the more than 40 million monthly unique users of the Houzz site and mobile apps. 
 
The Houzz & Home Survey was sent to registered users of Houzz and fielded in February-April 2019. The full report is available online.
 
Houzz has over 18 million photos of professionally designed interiors and exteriors, including completed kitchen and bathroom projects, and more than 2.3 million active home remodeling and design professionals including architects, interior designers, general contractors and design-build firms. 

Opinion: What are the effects of tariffs on the RTA cabinet industry?

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Ready to assemble cabinets have become an important part of a $30 billion cabinetry market in the U.S. (NKBA study). Globally, it is estimated that the RTA kitchen cabinets market will be worth more than $45 billion by 2023 (Research Nester).

Although American furniture producers offer RTA cabinets, Chinese furniture producers have become the market leaders in the industry, dominating both the American and global market. Chinese imported RTA cabinets have gained in popularity in this century due to greater affordability compared to custom cabinets, more abundant quantities of stock, and increased competitiveness in terms of quality.

Most Chinese RTA cabinets offer plywood construction, soft-close features, and solid wood frames/doors/drawer faces as standard options. While some other popular world cabinet producers, such as Ikea, also offer RTA cabinets, China's manufacturers managed to capture the American market with an appealing combination of contemporary looks, solid quality, easy assembly, and affordable prices.

Traditionally, Americans preferred custom and semi-custom kitchen cabinets. However, a changing lifestyle has led to a transitional and clean styling that has become a lavish standard for home improvement projects and new residential constructions.

Other kitchen cabinet producers noticed this sudden rise and popularity of Chinese RTA cabinets and have been faced with fighting tough, yet unanticipated, competitors.

These domestic producers started their own RTA cabinet production lines; however, the startup costs were high in addition to a constant increase in raw material costs while others in the industry already had a start with their superior and affordable products.

On the other hand, the timing of anti-Chinese product origin and trade policy in the U.S. has benefited domestic producers. Recently, the U.S. government introduced 10 percent, and subsequently 25 percent tariffs on China RTA cabinets as a part of a bigger tariff package on Chinese products imported to the U.S.

Recently, a group of 27 American kitchen cabinet manufacturers formed an alliance called the American Kitchen Cabinet Alliance (AKCA) that filed an antidumping and countervailing duty petition against China in March 2019. They asked to penalize Chinese merchandise with an average 216 percent tariff on kitchen cabinets.

AKCA wants the U.S. government to initiate an investigation on Made in China wooden cabinetry and vanities, hoping to pressure the Commission to slap anti-dumping charges. If the U.S. government should give in to these requests by April of the coming year, this would conclude the prosperity of the RTA market in the U.S. for an indefinite time.

The pros and cons of tariffs

While the allure of tariffs can be enticing to some, the introduction of such practices carries a heavy burden and lasting financial implications for not only the RTA industry but also end consumers.

Tariffs can serve as a short-term increase in duties, be used as an effective bargaining chip in politics, and level the playing field for national companies with traditionally higher labor costs. However, while the intent of tariffs might be noble, in the end they often come at a high cost for the greater public.

Tariffs skew the delicate free market equilibrium, whereby government policy dictates to some degree supply and demand. American end consumers have seen significantly decreased availability of cabinetry products, both in range and quantities. Prices are increased as the majority of companies don’t want to absorb costs hitting their bottom line and choose to rather pass these costs on to end consumers. With an increase in costs and limitation of supply, it follows that demand also weakens.

Implementation of tariffs and reaction of RTA industry (wholesalers, retailers, contactors): Passing on or absorbing costs

Phase 1 – September 24, 2018, 10 percent tariff on all product arriving and in transit.

Following the first introduction of tariffs, many U.S. suppliers applied a “tariff surcharge” on orders, passing on the cost to the wholesaler, dealer, contractor, and ultimately, consumer. National brands such as CNC Cabinetry started charging a “Tariff Charge” on all invoices at 6.5 percent. KCD, another national brand, applied a 5 percent tariff surcharge on October 1, 2018.

A few companies absorbed the initial 10 percent tariff. Instead of passing on the cost to their partners and consumers, they made internal adjustments, went lean, reduced administrative processes, and restructured and streamlined operations. Regional companies, wholesalers, dealers, and contractors all had the same choice, they could absorb the cost or pass it on. Many businesses chose to do the latter, despite enjoying a comfortable profit margin which could withstand such an imposition.

Phase 2 – May 10, 2019, the tariff increased from 10 percent to 25 percent

Most companies increased their prices again and, interestingly, even some companies that absorbed the initial costs changed their policy with Phase 2. US Cabinet Depot increased prices to its dealers justifying the price by stating, “At this time the allotted industry increases have created a level of expenses that require us to increases the MSRP to maintain the same level of quality, service, and expectations our dealers have become accustomed to.” CNC Cabinetry increased their “Tariff Charge” on all invoices from 6.5 percent to 12.5 percent. KCD added an additional 10 percent to their existing 5 percent tariff surcharge, totaling tariff surcharges to 15 percent.

Regional companies, such as ASIA Cabinetry Inc., which did not increase their prices initially, also sent out emails to their partners and consumers informing them of an increase in prices between 10-15 percent in Phase 2. Only a small percentage of companies absorbed the costs again, without any guarantees that they will continue to do so in the future.

Thus, it would appear that tariffs are not the end of the RTA industry. As long as companies can pass on the expense or restructure operations, the industry is still alive. Furthermore, since the tariffs are aimed at one country, many RTA factories have chosen to relocate operations and factories to neighboring countries. The result will be an increase in costs for U.S. companies and a shortage of supply for a short period while factories are set up. U.S. customers will end up footing the bill as they have become accustomed to paying more for RTA cabinets.

While tariffs pose a setback for RTA producers, the true challenger to the RTA industry will be the anti-dumping petition filed by the American Kitchen Cabinet Alliance on March 2019. The anti-dumping petition could actually signal the end of RTA cabinets.

Additional viewpoints and opinions are invited.

Texas millwork company makes planning a priority

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Keystone Millwork’s strength is planning and managing high-end architectural projects with many different types of materials.

Owner Bob Kraus said the Texas company keeps projects on track and organizes workflow and materials, while being detail oriented on the administrative side. They also work closely with general contractors on a number of levels.

That emphasis on planning extends to Keystone’s own operations. The company may have 30 to 35 jobs in progress at any one time. Casework is 45 to 50 percent of the business.

“We don’t just make boxes,” Kraus said. “We do a lot of the complex jobs and a wide variety of things, including fabric, leather, and metal. We make mockups for architects, 3-D drawings. Management planning and attention to details are strengths.”

Because these jobs can be complex, intricate projects, they want to make sure that customers are getting exactly what they wanted, said Keystone’s Kate Henderson, marketing director. That also allows Keystone to be in an advisory role, using value engineering to complete a job while saving money.

Emphasis on planning extends to Keystone’s own operations. The company may have 30 to 35 jobs in progress at any one time. Casework is 45 to 50 percent of the business.

Thirty years in Aggie country

Keystone Millwork provides custom architectural millwork for commercial construction. They are located in Bryan, Texas, in the heart of Aggie country and in the middle of the Texas triangle of Austin, Dallas and Houston.

Keystone operates out of our 40,000 square foot location but began 30 years ago in a one-car garage in neighboring College Station.

Kraus started the company in 1989, using a small Sears saw that was put on a tabletop. He started as a builder and had a number of businesses, with a degree in construction science, and said he should have gotten an MBA.

“Just because you can make a cabinet doesn’t mean you can run a business,” he said. “My lack of business knowledge was an impediment, but I’ve taken classes, done everything I could to learn.”

Kraus outgrew his first shop and began to add to his team. Sixteen years ago, Keystone moved into its current Bryan location and two years ago, that building was doubled in size. The recent expansion gives the company space for flexibility and staging work.

Before they moved to the current Bryan location, he paid consultant Gero Sassenberg to develop a plan emphasizing flow. Sassenberg provided concepts that Kraus put into practice when setting up the new location. “Best $3,000 I ever spent,” he said.

Keystone Millwork offers hands-on management of each project from start to finish and the ability to execute both large scale casework and fine custom designs. They meet with architects to design the millwork they envision, manufacture it in their facility and install the millwork themselves.

One of the biggest reasons for the company’s success is in training people, managing and paying them well. There’s no micromanaging, Henderson said. People are allowed to have ownership in their work. The company has 38 employees.

“It’s not about the wood, it’s about the people,” Kraus said. “Like most successful businesses, most of the people have been here 10 years. People like it here.”

Computing Services Project at Texas A&M University was completed earlier. Architect: The Arkitex Studio, Inc.

Contractor customers

“Our customers are large general contractors,” Kraus said. Work may be in educational, medical, university, museums, and performing arts centers. A lot of work is related to Texas A&M University in nearby College Station, which accounts for about a quarter of the jobs. Keystone also did 600 convenience stores for a major chain and 60 retail stores for a cellphone company.

Aggie Build is a special project in which Keystone is donating and providing cabinets that are put in a shipping container with medical equipment and sent to developing countries.

It’s so much about relationships, Henderson said. At one time Keystone did many small jobs, and then they wanted to do fewer big jobs. That became very oriented toward relationships. They only bid with the larger companies they want to work with. “They come directly to us because they like us,” she said.

Keystone’s estimating department is really the face of the company. “Our estimators work with the general contractor’s estimators to put out a number so that when they get their final number on bid day, they’re confident that it is a good number,” Henderson said. “The fact that we have a very thorough and complete estimate is very meaningful. It’s the face of our company.”

Kraus also seeks out the challenging work.

“We’ll get a complicated set of drawings that is hard to understand,” he said. “I’ll say, yes, that’s what I want. Most people won’t touch that. I want to be the person who goes after that.”

Scheduling is one of their main issues, as millwork providers are one of the last to get into the building.

“That’s what we’re constantly trying to refine,” Henderson said. “How do we get enough ahead without putting ourselves in a bind? Expanding the shop helped us tremendously. Now we can have projects wrapped and ready for delivery.”

Kraus said that Keystone is paid for stored material when it’s is sitting in their operation.

Keystone has a Mayer panel saw with Weima grinder and a several smaller dust collectors rather than one large system for the whole plant. Cut pieces have a barcode label applied.

Flexibility in the shop

Keystone has a Mayer panel saw with Weima grinder and a several smaller dust collectors rather than one large system for the whole plant. Cut pieces have a barcode label applied.

A Homag Vantech 512 CNC router, Weeke ABD 050 Optimat dowel inserter, and Brandt edgebander, along with a Thomas return conveyor are also in the Bryan operation.

A Weeke BHX 055 Optimat vertical machining center provides flexibility in the overall operation if other machines were busy or not available.

“The BHX is great little machine, it helps flow quite a bit,” Kraus said. “It gives us more capabilities, diversity and options. It’s a perfect complement to the nested-based router and the beam saw. The three work together very well. It’s a great combination of machines.”

In the assembly area is a J.C. Uhling HP3000F case clamp. An older Busellato Jet 4002 CNC router is used as a backup for the shop.

The shop also has a custom fabrication area for solid wood and special work, and a countertop fabrication area. They are doing fewer laminate tops, but added solid surface capability. They do most installation, especially locally.

Henderson said that expanding the shop helped them in two major ways. They were able to order materials earlier, and store them and organize them.

Keystone has used many different kinds of software over the past 30 years. They are now using Microvellum and Cabinet Vision for drawing, and TradeSoft’s ProjectPAK and ShopPAK for the management side of the business.

Keystone does 90 percent of machine maintenance themselves, working with Texas A&M or hiring a local technician rather than calling a machine tech from out of town.

 

Finishing in the future

Finishing capability is planned for the future. Keystone will start with an inflatable portable finishing booth. They are planning for no VOC finishes, all water-based, which will save on fire prevention equipment.

But Keystone will continue to send out larger finishing jobs, such as 300 sheets to a flatline finisher, Widner Product Finishing. Kraus wants do the smaller number of pieces or one-of-a-kind finishing in house.

Over the past 30 years, Kraus said the biggest change is manufacturing has been in software, especially in the office end of the business.

Kraus is also looking for a quantum shift, maybe away from laminated panels to plastic cabinets or injection molded boxes. He is trying to anticipate what might affect the business for the next 30 years.

Keystone Millwork offers hands-on management of each project from start to finish and the ability to execute both large scale casework and fine custom designs.

 

AT A GLANCE

Keystone Millwork

Bryan, Texas

Custom architectural millwork for commercial construction

Employees: 38

Plant size: 40,000 square feet

http://www.keystone-millwork.com


Changes in benchmark reduce remodeling market size estimate

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The latest Leading Indicator of Remodeling Activity release projects national spending for home remodeling and repairs will grow to $331 billion in 2019, an increase of 5.5 percent from last year, writes Abbe Will of Harvard University’s Joint Center for Housing Studies. This LIRA release also updates and revises historical spending levels and growth due to the incorporation of new benchmark data from the recently released 2017 AHS.

The LIRA provides a short-term outlook of national home improvement and repair spending to owner-occupied homes and is benchmarked to national spending estimates from the US Department of Housing and Urban Development’s American Housing Survey (AHS).

Compared to last quarter’s LIRA release, the updated LIRA now shows lower market size estimates and projections for remodeling and repair activity in 2018, 2019, and the first half of 2020.

According to tabulations of the AHS, spending in 2016 and 2017 was not nearly as robust as the LIRA model predicted, growing only 5.4 percent from $278 billion in 2015 to $292 billion in 2017 compared to LIRA estimated growth of 11.9 percent over this time period. As seen in the chart, the lower growth in benchmark remodeling and repair spending in 2016 and 2017 has implications for the size of the market projected by the LIRA model for 2018, 2019, and 2020.

Previously, the LIRA estimated a homeowner improvement and repair market size of $336 billion in 2018 and projected that spending would grow to $353 billion in 2019. With the replacement of AHS-based benchmark data for previously modeled estimates, the LIRA model indicates remodeling activity reached $313 billion in 2018 and projects spending will reach $331 billion this year. The implication of slower growth in actual remodeling and repair spending over 2016 and 2017 is a reduction in market size projections for 2019 of 6.3 percent or $22 billion. 

In 2016, the LIRA was re-benchmarked to a measure of home improvement and repair spending based on estimates from HUD’s biennial American Housing Survey. Once every two years, with new historical AHS data, the LIRA benchmark series will also be updated. Beginning with the July 2019 release, the LIRA model will be used to estimate historical spending levels since 2017 until the next biennial release of the American Housing Survey allows for actual 2018 and 2019 spending data to replace modeled estimates. 

More detailed analysis of recent and expected trends in home improvement and repair activity is available in the latest Improving America's Housing report released earlier this year. See https://www.jchs.harvard.edu/research-areas/reports/improving-americas-housing-2019

Brave venture becomes million dollar success

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Had Jesse Cline listened to the economic pundits back in 2008, he would not have left a steady job as superintendent for a large home builder to pursue the dream of his own cabinetry and home organization shop: Brave Custom Woodworking.

“My accountant said I was awfully ‘brave’ to start a company during the recession,” Cline retold. “But what helped me succeed was that I was able to adapt to the market and handle small jobs, when a lot of other companies wouldn’t or couldn’t, and went under.”

Since beginning in a two-car garage, the company has grown significantly, with sales surpassing $1 million the past few years. Based in Manassas, Virginia, Brave Custom Woodworking serves the homeowners and builders market, offering complete design, fabrication, finishing and installation services to customers located throughout the region.

Organized mix of products

Despite its small size, the company offers a large range of products. Brave Custom Woodworking specializes in quality custom cabinetry for every room in the house, including products for the kitchen, laundry room, mudroom and closets. Kitchen and bath cabinetry account for approximately 50 percent of the company’s work, with built-in cabinetry around 30 percent, followed by closets and mudrooms at 10 to 15 percent; a small percentage of work is also in commercial.

 “Our closet and mudroom offerings evolved from requests from our customers,” Cline said. “We’re a little bit different from a typical shop in that we build the closets in boxes – base and upper units – then customize from a basic template.”

The company also markets the fact that it differs from other closet providers “in that we do not bring in a ‘bag of parts’ to your home nor are we a franchise operation.”

Wood Industry 40 Under 40

Brave Custom Woodworking's Jesse Cline a 2018 40 Under 40 honoree

Read about Jesse Cline's achievements, and those of the Wood Industry 40 Under 40 Class of 2018. For information on the 2019 and other 40 Under 40 alumni, or how to nominate an individual, visit WoodworkingNetwork.com/40-Under-40.

Brave Custom Woodworking promotes its products and services to homeowners, builders and interior designers through word of mouth, online marketing, social media, articles and website traffic. In addition to showroom displays, photos are posted and updated regularly on the company’s website, builtincabinet.com, as well as at Houzz and Pinterest. They provide a visual testimonial of the quality work, along with inspiration for future projects. “A lot of customers will reference the pictures on the website,” when contacting Brave Custom Woodworking, Cline added.

The company has developed a simple checklist for prospective customers to submit information, which it uses to develop a project estimate (see sidebar). “One of the first questions we usually ask is, ’What’s it going to be used for?’” he said.  “We’ll give them a ballpark figure and if it fits within their budget, we’ll go on site to meet with them, get more details and take measurements,” he explained. Three-dimensional drawings are also provided for review, prior to any construction.

“We’re willing to work with customers and give them what they want, to their exact needs and specifications,” Cline said.

Range of capabilities

Business is often brisk, with typically six to 10 projects in process throughout Brave Custom Woodworking’s approximately 12,000- square-foot shop, and a turnaround time of approximately four weeks from the signing of the contract. With 15 employees, the company also has a certified designer on staff, while providing solid wood and panel processing, CNC machining and on-site finishing services. Brave Custom Woodworking is also well-known in the region for its handcraftsmanship and attention to detail.

High-end residential projects account for three-quarters of the company’s work, and can price anywhere from $400 for simple bookcases to thousands of dollars for a complete kitchen, depending on the size and complexity.

“I don’t think any job we do is considered standard,” Cline said. “We can customize every part of the job.”

Cabinetry is a major component of the company’s work, whether for the kitchen, bath, closet or another area of the home. The cabinet boxes are made from premium cabinet grade 3/4-inch thick prefinished hardwood plywood, such as PureBond from Columbia Forest Products, or 3/4-inch thick TFL MDF from companies such as Arauco, Roseburg and Uniboard, and joined with a combination of screwing and blind dados.

Along with face-frame construction, the company also offers frameless cabinetry construction. A third, proprietary method – a shared face frame, in which the two sides fit into each other – is also available.

Components such as one-piece MDF and five-piece solid wood doors, are also manufactured in-house. Approximately 80 percent of the projects incorporate solid wood, such as maple, poplar and other hardwood species, and the equipment inside the shop reflects this, with a mix of dedicated machinery for solid wood production, along with CNC and panel processing equipment. “We may be a small shop, but we try to maximize all the space,” Cline said. Employees are also cross-trained.

Recently purchased, the SCM Morbidelli CNC router is already a workhorse. “We nest everything,” Cline said. “Every job that goes through the shop gets cut on this machine.”

Also used widely is the Brandt edgebander, with 100 percent of the closets jobs involving edgebanding such as on shelves, along with 20 percent of other projects.

Cabinet Vision software is used for the design and programming. Also in the shop has a variety of equipment, including a vertical panel saw, dedicated shapers for upper and lower cabinets and a new dowel machine, from suppliers including Grizzly, Ritter, and Atlantic Machinery. The dust collection system is Whispurr, from Dustek.

Also within the shop is a dedicated finishing area, with two bays, Eagle spray booths, Kremlin guns and a drying room. “Eighty-five percent of everything we do gets finished by Brave,” Cline said, with custom color and stain matching available.

What also sets Brave Custom Woodworking apart is its full-service, including installation. The company has two installation crews and guarantees one-day installation on most jobs.

Never one to rest on his laurels, Cline said he regularly looks to industry magazines, trade shows, suppliers and associations for news on technology, trends, advice and networking opportunities. The company is also a member of the Cabinet Makers Association and National Kitchen & Bath Association.

One piece of invaluable advice, Cline shared, is to work with the customer to obtain the best value, “but don’t be afraid to go outside the box.”

“If the customer is willing to let us try something, then we’re willing to do it,“ he said. “It’s definitely not boring around here.”

5 questions to ask before providing an estimate

Before a project estimate can be given, here are a few things Brave Custom Woodworking needs to know. (Visit builtincabinet.com for more on the company, plus the full checklist.)

Along with customer contact information:

1. What is the type of dwelling: single family, townhouse or high-rise installation/floor?

2. What are the basic dimensions of the intended installation (wall width, wall height & depth of cabinets desired)?

3. What type of finish is desired (paint, stain grade wood or a thermofoil finish)?

4. How will the space be used (TV area, home office, closet, kitchen, etc.)?

5. What are some of the dimensions of items to be displayed or hidden (i.e., size of TV, stereo equipment, children’s toys, etc.)?

Prospective customers are also requested to email low-resolution photo(s) of the existing room/area. They are also encouraged to consult the portfolio on Brave Custom Woodworking’s website for ideas or inspiration.

Winners named in 2019 CMA Wood Diamond Awards

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CHICAGO, IL – Winners of the 2019 Wood Diamond Awards contest have been announced by the Cabinet Makers Association. The annual design competition promotes professional development and encourages peer recognition of outstanding workmanship in a variety of categories.

The 2019 award winners were announced on Thursday, July 18, during the AWFS Fair in Las Vegas. First place winners were awarded a customized plaque in their respective category.

CMA President Chris Dehmer congratulates Tom Floyd, Custom Creative Furniture, on his first place win.

“The Wood Diamond Awards program is an exceptional opportunity to recognize the unique talents of its members,” said CMA member Ken Kumph of Premier Builders, Georgetown, Massachusetts.

"This year's competition was extremely competitive, particularly in the frameless kitchen category, which had 28 entries," said CMA Executive Director Amanda Conger. The high percentage of frameless cabinet construction entries is consistent with overall industry trends, she added.

The variety of submissions within the residential category also confirms that cabinetry continues to extend to every room in the home, Conger said. Interestingly, although the vast majority of submissions (90 percent) were residential, the overall winner was a commercial project.

And the award goes to...

Winning the 2019 “Best Of, Best Overall” award was Covenant Millwork in Louisville, Georgia. The project also won for its category  “Commercial: Hospitality.”

First place winners are listed below and the projects can be viewed in the slideshow. Details on the projects can be found at cabinetmakers.org/2019winners.

Commercial
Hospitality: Covenant Millwork (Louisville, Georgia)
Medical: Ipswich Cabinetry (Ipswich, Massachusetts)
Retail: Ogee (Oakland, California)

Residential
Bathroom
Frameless

Under $10,000: Custom Creative Furniture (Lawrenceville, Georgia)
Over $10,000: Sofo Kitchens (Maple Ridge, Britsh Columbia)

Kitchen
Face Frame

Under $25,000: Chandler Cabinets (Pilot Point, Texas)
Over $25,000: Covenant Millwork (Louisville, Georgia)
Frameless
Under $25,000: CVR Colorado (Loveland, Colorado)
Over $25,000: Patzer Woodworking (Mitchell, South Dakota)

Living Spaces
Bar

Under $25,000: Dibbleville Woodworks (Fenton, Michigan)
Over $25,000: CVR Colorado (Loveland, Colorado)
Entertainment Center: Under $10,000: CVR Colorado (Loveland, Colorado)
Fireplace Surround: Sofo Kitchens (Maple Ridge, British Columbia)
Wall
Under $10,000: Dibbleville Woodworks (Fenton, Michigan)
Over $10,000: Danlee Wood Products (Forreston, Illinois)
Bedroom
Under $10,000: Sofo Kitchens (Maple Ridge, British Columbia)
Over $10,000: Sofo Kitchens (Maple Ridge, British Columbia)
Fish Tank Stand: Under $10,000: Custom Creative Furniture (Lawrenceville, Georgia)
Office: Danzo Group (Baldwin Park, California)

Utility/Storage
Closet/Dressing Room:
Sofo Kitchens (Maple Ridge, British Columbia)
Mud Room: Sofo Kitchens (Maple Ridge, British Columbia)
Wine Cellar: Ipswich Cabinetry (Ipswich, Massachusetts)

Celebrating more than  20 years of industry service, the Cabinet Makers Association was incorporated in 1998 by a group of custom cabinetmakers who thought the small to mid‐size shop needed to network and help each other grow profitably. Currently, CMA membership is made up primarily of 20 or fewer employee operations, with the vast majority of those being 1‐5 person shops.

Arkansas Wood Doors offers new ordering system

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POTTSVILLE, Ark. -- Arkansas Wood Doors has announced a new order system for its wood and RTF style cabinet doors, veneer raised panel inserts, and custom RTA cabinet system, Stonehenge Cabinets.

Their products can be ordered via their online order system that will also calculate estimated price, less shipping charges. In addition to the cabinet door and cabinet box order system, they also offer a 3D Design Center option that will allow the user to input wall dimension details for their kitchen job.

The user the pulls the cabinet style from AWD’s Stonehenge Cabinet library and applies size of cabinet needed, places in position on the wall, selects a door style, and applies any options. Once complete, 3D Design Center will calculate an estimate on screen and develop an elevation drawing. User can modify calculated price from cost to sell price quickly with only a single edit function. 3D Design Center allows user to accomplish this during the initial visit to the job site or during a review of drawings in a short time. The platform that 3D Design Center has been developed from allows for easy changes and adjusts estimate as changes are made.
   
Those companies that use KCD software are able to forward KCD door and/or cabinet files directly to AWD for them to reply with their quotation. This also includes Cabinotch files developed within KCD. See http://www.arkansaswooddoors.com.

Made-in-Massachusetts cabinet company keeps costs low by buying domestic materials

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NORWOOD, Mass. -- Metropolitan Cabinets & Countertops is holding the line on costs by sourcing domestic materials and avoiding import tariffs.

Metropolitan has been locally manufacturing cabinets for kitchens and bathrooms in Norwood since 2005, and is celebrating 35 years in business this year. Metropolitan has continued to expand its manufacturing capabilities and facilities over the past 14 years and doubled its factory size in 2017 to more than 150,000 square feet. The company has the latest computer-driven machinery and technology.

All materials used for the cabinetry are American sourced. The plywood comes from Oregon, the maple used for the drawer boxes is brought in from Minnesota and the wood doors are handmade in Pennsylvania. Metropolitan’s prices and lead times will be able to remain unchanged as tariffs are set to affect the industry with ties to international products and materials.   

The company’s cabinets are assembled in Norwood, which has increasingly created local jobs over the past 15 years. Metropolitan was a Mass Econ Award recipient in 2017 for outstanding contributions to the Massachusetts economy.

Metropolitan has grown from a three-person company in 1984 to 170 employees today. Metropolitan is the largest manufacturer of cabinets in the Northeast. and has a reputation for manufacturing high-quality cabinets and countertops for residential homes and multi-family properties.

Metropolitan’s success and continued growth is due in large part to staying ahead of industry changes and reacting to client’s evolving needs and demands. Metropolitan received a 2019 Best of Boston Home award for Best Kitchen Designer and a 2017 Best of Boston Home award for Best Cabinetry.

“For 35 years we have continuously grown and expanded and we have no plans to slow down” said Metropolitan president Stuart Elfland. “We aim to be the best in the business and we will always strive to modernize and evolve.” See http://metcabinet.com.

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