timber news 3/2009 - SCA Forest Products AB

Boards from SCAon the shelvesat Home Depot1979, US chain Home Depot has opened more than2,200 DIY and home furnishing stores, with many oftheir shelves stacked with timber products fromSCA’s sawmills in Rundvik and Bollsta.Planed timber products from SCA Timber are sold in almost 500 of US DIYchain Home Depot’s stores.Photo: Per-Anders SjöquistIn the space of 30 years, Home Depothas managed to establish itself as theworld’s biggest DIY and home furnishingchain. The company’s huge stores,many of which are open 24 hours a day,showcase everything you need to build ahouse, from floor to roof.Everything about Home Depot is on amassive scale. The Group’s 300,000employees are spread throughout the US,Canada, Mexico, Puerto Rico and China.More than 40,000 different products areavailable to the 22 million customers thatpass through the company’s doors everyweek.“Home Depot has broken the homedown to its smallest constituent components,”says Birgitta Boström, productmanager at SCA Rundvik. “The numberof barbecue grills available alone exceeds150.”A wide range of products at low prices,good parking facilities and excellent serviceare factors that have contributed togiving Home Depot 25th place onFortune’s list of the biggest companies inthe US. What’s more, it’s also one of themost lucrative, racking up profits in excessof USD 514 million for Q1 2009.The extensive range of building productson offer at Home Depot also includesplaned, environmentally labelled andbarcoded Swedish timber products thathave been adapted to be easily loadedonto customers’ roof racks. The selectgroup of suppliers who contribute toensuring that the shelves in Home Depotstores are never empty has included SCATimber since 1997.Satisfying demanding customers suchas Home Depot demands a complexsupply and service puzzle where all piecesmust fit precisely together. Price and qualityare just two of the criteria that mustbe satisfied. Others include delivery reliability,service and product range.“We’ve successfully completed ourundertakings for over 10 years,” saysBoström.Once clear of the narrow eye of theneedle through which each supplier toHome Depot must pass, the potential forremaining in the exclusive group thatkeeps the shelves of the company’s morethan 2,000 stores filled is good.“Home Depot is one of SCA Timber’sbiggest customer,” summarises Boström.“Of the 180,000 cubic metres of productmanufactured at Rundvik, around 57,000cubic metres ships to Home Depot storesin the US. In addition, approximately14,000 cubic metres are shipped fromSCA’s sawmill in Bollsta.”This means that SCA currently suppliesaround 25% of all solid wood productsexported from Sweden to the US, equatingto approximately 10% of all Europeansolid wood product exports to the samedestination.“Once the financial situation in the UShas stabilised and construction starts topick up, volumes will increase further,”believes Michael Wicklund of Kelowna,Canada, who is responsible for SCATimber’s sales in the US and Canada.One of the key factors in the success ofRundvik sawmill maintaining good relationswith Home Depot over the past 10years is that the delivery chain has remainedintact, from forest all the way toshipping. In order for each load to beidentical, there must be a steady streamof raw material that is cut to the specifiedlength.“If you’ve miss something in onemonth, it’s impossible to recover duringthe next,” explains Boström.Every five weeks, a ship leaves the portat Rundvik and heads to Philadelphia,which is where SCA has its distributioncentre for the American market, with upto three weeks’ worth of product held instock on site.Using forecasts and stock level informationcollected from Home Depot’sstores, trucks and trains are ordered upto supply nine of Home Depot’s regionalwarehouses with solid wood productsfrom Rundvik and Bollsta. In turn, eachregional warehouse serves between 80and 120 Home Depot stores.“This means that planed 19x89 and19x140 boards from SCA Timber – infour different lengths – are sold in almost500 Home Depot stores,” says Boström,who has a positive view on the potentialfor taking over responsibility for supplyingmore of Home Depot’s regional warehouses.“The economic crisis has broughtmany sawmills to their knees,” she says.“And when they are unable to meet theircommitments, we will be in a position tomove in and fill the vacuum created.”Mats Wigardt3 | timbernews