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Twelve good reasons to buy NDMA products.

Quality parts, cost control and potential new markets are some of the benefits of buying dimension stock.

Every year, more and more furniture, cabinet and millwork manufacturers turn to producers of dimension stock for their hardwood components, rather than continue to make the parts themselves. Following are a dozen good reasons for purchasing hardwood dimension stock from independent suppliers:

BETTER CONTROL OVER COSTS. A major advantage of purchasing wood parts is that exact material costs can be determined, eliminating much of the guesswork that often enters into the calculation of a given product's cost.

ASSURANCE OF HIGH QUALITY, USABLE DIMENSION PARTS. NDMA members specialize in dimension manufacturing and have acquired a great deal of experience and expertise in processing lumber into semi-fabricated and completely machined wood parts. Thus, a dimension buyer is assured of obtaining a high quality, usable wood product made to exact specifications.

REALIZE A GREATER RETURN ON YOUR INVESTMENT. Studies have indicated that furniture or kitchen cabinet manufacturers can achieve a higher return on investment by allocating their resources to the design, assembly, finishing and marketing areas, while letting someone else make their parts for them.

REDUCE YOUR CAPITAL INVESTMENT. The purchase of wood parts permits furniture and kitchen cabinet manufacturers to operate with a minimum investment in land, labor, buildings, machinery and equipment.

THE ADVANTAGES OF LOCATION. Many dimension manufacturers are located in rural areas close to timber supplies and enjoy the advantages of lower costs in land and labor, resulting in lower production costs.

SAVE ON TRANSPORTATION COSTS. By purchasing wood components, a furniture and kitchen cabinet manufacturer can save on transportation costs, since nearly two-thirds of the weight and bulk of the lumber is removed at the dimension mill.

NO WASTE PROBLEM. Disposing of wood waste is a problem to many companies. However, dimension manufacturers can effectively utilize their wood waste as steam fuel for operating their dry kilns and heating their plants, thereby lowering their production costs.

SAVE ON INVENTORY AND LUMBER COSTS. Furniture and kitchen cabinet manufacturers who produce their own dimension parts must inventory lumber in all species used, which ties up working capital. By purchasing wood parts, a manufacturer can increase his working capital and reduce inventory costs through quick turnover.

REDUCTION OF OVERHEAD EXPENSES. The use of purchased prefabricated wood parts will reduce overhead expenses without a reduction in sales volume. Reductions of raw material inventory and of dimension machinery purchases will cut the costs of inspection, supervision, maintenance, indirect mill costs, insurance, depreciation and taxes.

ADVANTAGES OF SPECIALIZATION. Dimension manufacturers can maximize their lumber yields by cutting sizes for more than one customer from each board. They also have more skilled personnel and a wider range of machinery. The component manufacturer is generally more knowledgeable about his product costs and can supply parts more economically than firms making their own parts.

ENTER NEW MARKETS AND ADD NEW PRODUCTS. Many finished product manufacturers find it difficult to justify purchasing the expensive equipment needed to produce a promising, but unproven product. Therefore, they find it more economical to purchase the necessary parts and concentrate their efforts in the design, assembly, finishing and marketing areas.

ADD AN INTERESTED PARTNER TO YOUR BUSINESS. Like a subsidiary or extension to your manufacturing operation, the dimension supplier can contribute to a more profitable business venture.

A 13TH GOOD REASON

New companies would be wise to work with experienced wood component and dimension manufacturers. By focusing mainly on assembly and finishing, their initial capital investment is greatly reduced. Perhaps even more importantly, working with component specialists removes some of the start-up pressure of recruiting qualified supervisors, implementing employee training programs and finding sources for raw materials.

I might add that this also holds true for companies who are in an expansion mode or who are introducing new products.

I am constantly asked about the investment in new and highly technical equipment, as well as sources for new materials. On many occasions, these conversations, especially with small operators, lead me to recommend that they form partnerships with dimension manufacturers. I really think that the headaches of obtaining, training and keeping personnel, equipment investment, machine maintenance and so forth have to be factored into the make or buy equation.

On top of this, the rising cost of lumber adds new emphasis to the benefits of purchasing components. Dimension manufacturers have invested in their plants to not only optimize lumber yields, but also to minimize part rejects. They have the skill and the know-how to control costs.

We tend to forget sometimes that styles and demands change rapidly and these changes can impact an operation's machinery needs. Woodworking machinery manufacturers have made tremendous strides in engineering more flexible equipment to meet this challenge. But there are times when the most flexible solution is sourcing a part or parts to a dimension expert.

I have been involved in furniture manufacturing for more years than I am willing to admit. If I were to start over today, I would certainly bank on the flexibility and service of wood component and dimension manufacturers.

Jerry Metz is a contributing editor to WOOD & WOOD Products and former owner of Metz Furniture.
COPYRIGHT 1993 Vance Publishing Corp.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Title Annotation:10th Annual Dimension Purchasing Guide; National Dimension Manufacturers Association
Publication:Wood & Wood Products
Date:Jul 1, 1993
Words:858
Previous Article:Utilizing forest resources.
Next Article:Rules and specifications for dimensions and woodwork.
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