Industry panel focuses on service as key to competing with imports
By Brian Carroll -- Furniture Today, March 3, 2002
GREENSBORO , N.C. — GREENSBORO , N.C. — To remain competitive in the face of increasing imports, domestic manufacturers will have to leverage more than operational excellence, and service will remain perhaps the key point of differentiation.
These conclusions and others were reached by a pan-industry panel discussion here at the Carolinas Industrial Woodworking Expo, co-sponsored by the Wood Component Manufacturers Assn.
"We're here (at the panel discussion) because low-cost areas are beating our pants off," said Art Raymond, president of A.G. Raymond & Co., a Raleigh, N.C.-based consultancy.
Since U.S. furniture manufacturers can't compete with the Chinese on price, he said, "and product can easily be copied by any factory in the world, perhaps the only attribute left to compete on is service."
Raymond, who also teaches at N.C. State University, said to win on service, companies must have accurate data available on the factory floor; they must systematize sales and operations planning, such as forecasts, inventory plans and logistics master schedules; and they have to respond rapidly to demand.
"A manufacturer has to have a smart product policy, as well, which means parts standardization, modularity wherever possible, an investment in consumer research, a focus on volume, and an ability to eliminate slow-selling SKUs," he said.
A company embodying many of the virtues espoused by Raymond is Vaughan-Bassett, which to relies on a relatively low number of high-volume lines, top-level service, and delivery times that are among the industry's shortest.
"It's easy to panic when you hear about 25-cent-an-hour labor, no environmental controls or costs and government subsidies," said Wyatt Bassett, executive vice president of the Galax, Va.-based manufacturer. "It's easy to panic and make poor decisions."
Bassett cautioned domestic factories to be patient, and to be passionate about making something, not just making the sale.
Be especially passionate about change, he said. "It's why tanks have tracks on them. You better keep moving."
Raymond agreed, pointing to the kitchen cabinet industry as furniture's model. "They defeated institutional memory and developed a bias for change," he said. "They invested in people and in IT. They standardized, yet enabled customization, and broadened their product lines."
Bassett pointed to some of the programs Vaughan-Bassett has used to weather the difficult economy, including the Gimme 5 and Operation: American Spirit sales promotions. They are examples of the company's determination to be "the one moving the cheese, not the ones reacting to the fact that it's been moved," he said.
The producer's upcoming Elvis Presley Collection, its first licensed program, is emblematic of this take-charge attitude.
"Will Elvis sell furniture?" Bassett asked. "We don't know. But we're going to try it."
Also on the panel were Ed Jerger, president of Ed Jerger & Associates, a consultancy; Jeff Ferguson, a sales representative for Brookville Wood Products; and Steve Lawser, executive director of Wood Component Manufacturers Association.
Seven seminars were presented during the woodworking show, an increase over previous editions. "We focused on empowering the relationships between manufacturers and industrial woodworking suppliers," said Keith Eidson, president of show organizer Trade Shows Inc.
The show featured 450 exhibitors and attracted an estimated 5,500 attendees, offering machinery, tooling, supplies and services for the furniture, cabinet, case goods, millwork, industrial wood products and plastics industries.
| Raymond |
| Bassett |
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