Welcome to our sector’s new reality
By Alain Albert
Only a short time ago, you could open the hood of your car and there was an engine in there. Yo u could tune your carburetor, change your spark plugs and tinker with other mechanical devices that were easy enough to understand for most weekend mechanics. Now, lift your hood and you’ll find lots of plastic and electronic components. Not much that most of us can understand, much less mess around with.
Over the last 20 years or so, the same thing happened to the wood industry. Our jigs, templates, storyboards and hand tools have slowly been replaced by software, sensors and programmable logic controllers. Where we once made a living with our hands and long-practiced skills handed down from generation to generation, now it seems to make it all work, one needs a degree in computer programming.
In this column, we’re going to explore the depths of the high tech wood industry. We’ll demystify some of the new practices and push the boundaries of some of the more familiar devices.
Traditional skills are not completely gone, discarded in the trash bin of forgotten abilities. Don’t get me wrong; wood is far from being the new Damascus steel. What has become clear, though, is that the modern shop owner needs a new set of skills that has little to do with tradition. Whether you own the business or you are looking for a job in the industry, you probably want to throw a little 21st century expertise into the conversation every now and then to sound more relevant. A little CAD/CAM here, some CNC or robotics there, maybe some knowledge of ERP or social media marketing would be quite appropriate to round it all out.
You cannot compete on price:
We all know contemporary wood manufacturers can’t compete on price alone. The days of mass-production are behind us and there are still too many mass-producing behemoths out there that we’ll never under- price. What is more relevant to every one of us is to understand how the marketplace has changed.
Consumers want what they want and they now have a good idea how it’s done. They want to express their individuality and they want an experience and if you don’t give it to them, they’ll go somewhere else, or, hell, they’ll figure out how to do it themselves. This is important to understand, especially if you’re a small business. The manual skills you learned 30 years ago, the secret suppliers … are not a secret any more.
More than ever, you need to differentiate, target a niche and share and collaborate with your customers. Otherwise, you simply won’t get heard above the din of the crowd. This is the new reality of the digital world.
The next generation:
Believe it or not, we’re on the cusp of a revolution in the manufacturing industry — all manufacturing industries, not just the ones that use wood. Local manufacturing is coming back with a vengeance. New kids are in town and they see plenty of opportunities in the digital economy. Those opportunities are there for you as well and here is an outline of just a few of them:
Soon, you’re not going to buy furniture in a store; when is the last time you set foot in a furniture store anyways? It’s probably a desolate place these days.
Are you one of those who still thinks that nobody is going to buy a cabinet or a piece of furniture online? There were people that said the same thing about clothes, shoes, books and music. Ask a millennial what they think about buying a sofa or a child’s bed online.
Furniture in North America is a $100B industry. Only a small portion of revenues are generated from online sales now as most retailers and manufacturers have not started using e-commerce in a meaningful way. What happens when the floodgates open? Are you going to be ready with a powerful e-commerce website with product customization?
The new consumer doesn’t aspire to be just like the Joneses. They want to assert their individuality and they want to participate in the process of designing and building their ideal surroundings.
New software and CNC technology make it possible for manufacturers to give their customers infinitely customizable products in a batch-one production environment, and with short lead times. There is no longer any reason it should take eight or 10 weeks to produce cabinets or furniture, not today.
Selling custom furniture used to be complicated, requiring very complex internal systems to manage all the processes involved in delivering an order. Only very large corporations with deep pockets could develop online customizers and product visualization platforms. These days, a small shop can very well afford a product customizer to sell user-generated orders directly on their website.
Showing off your custom manufacturing capabilities is orders of magnitude easier today with an abundance of social media platforms at your disposal, using video, pictures, etc… and mostly for free.
The more you can automate processes in your factory, the easier it’s going to be to produce exactly what your customer needs.
When we’re talking automation, I don’t mean only CNC and robots, but every process from your initial offering to final delivery. As mentioned earlier, your customers are willing to build their own orders on your website, the supply chain can then be automated and the same for producing the work orders and CNC programs for the shop floor. Your paperwork for shipping, invoices, and even corrugated packaging, can all be automated.
All you need now is to throw in a little lean manufacturing and some human ingenuity, and your factory will soon look like it belongs in a Sci-Fi utopian movie.
Skilled labour shortage:
Some of you are going to say “But it’s hard to find good labour,” and it’s a fact, so ask yourself: who would want to work for just a notch above minimum wage in a dusty, noisy and dark work environment? Would you want that job? It’s no wonder that there’s a labour shortage in our industry.
Try looking for skilled programmers, instead: designers, engineers and just plain creative people who want to make things with their hands and earn a decent wage and you’ll find lots of candidates.
The most important metric for any manufacturer is productivity. Simply put, it measures the output produced per unit of input. For example, most traditional wood manufacturing companies have a labour productivity ratio between $75K and $150K/employee/year (divide total sales by number of employees). This number can easily grow as high as $500 or $600/worker/year for a digital factory where fewer, more-talented workers can produce more and faster than in a traditional shop.
If you are still trying to carve a place in the 21st century wood industry marketplace, keep your eyes on this column because together, we’re going to explore all aspects of the high-tech digital wood manufacturing world. We’re going to investigate CAD/CAM software, CNC, robotics, e-commerce and any other digital technology we can get our hands on.
Don’t be shy, let me know what you’re thinking or what you’re doing. Send me your comments and get in touch with me directly and together, we will ride the tidal wave of the digital manufacturing revolution.