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H A R DWO O D M AT T E R S T H E VO I C E O F T H E H A R DWOO D I N D U ST RY
H NLA AND
ADVOCACY
T H E O F F I C I A L P U B L I C AT I O N O F T H E N AT I O N A L H A R D W O O D L U M B E R A S S O C I AT I O N S T R O N G R O O T S . G L O B A L R E A C H . | W W W. N H L A . C O M
Rules Corner
features 14 What Is Hardwood Advocacy And Why Should You Be Involved? READER SERVICES President’s Message CEO's Message Educational Calendar
Instant TOP POST OF THE MONTH at facebook.com/NHLAOfficial National Hardwood Lumber Association The 183rd class toured Jones Hardwoods,Inc. in Union City, PA this week. Just a few more days til graduation! Congratulations class!
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CONTENTS
Advocacy
WHAT'S INSIDE
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september 2017
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12 Family Business
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10 DEPARTMENTS
Labor
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H A R D W O O D M AT T E R S T H E VO I C E O F T H E H A R DWO O D I N D U ST RY
THE MISSION OF NH LA To serve NHLA Members engaged in the commerce of North American hardwood lumber by: maintaining order, structure and ethics in the changing global hardwood marketplace; providing unique member services; promoting North American hardwood lumber and advocating the interest of the hardwood community in public/private policy issues; and providing a platform for networking opportunities.
September 2017 ▪ Issue 182 National Hardwood Lumber Association PO Box 34518 ▪ Memphis, TN 38184-0518 901-377-1818 ▪ 901-382-6419 (fax) info@nhla.com ▪ www.nhla.com
EXECUTIVE COMMITTEE
MISSION LEADERS
Brent Stief Huron Forest Products President
Jack Shannon J.T. Shannon Lumber Co. Unique Services
Darwin Murray McClain Forest Products Vice President Pem Jenkins Turn Bull Lumber Co. Past President 2014-2016 NHLA STAFF Lorna D. Christie CEO l.christie@nhla.com Renee Hornsby Director of Communications/Editor r.hornsby@nhla.com
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TJT Consulting
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Thompson Appalachian Hardwoods
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King City/Northway Forwarding
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U•C Coatings
IFC
Pike Lumber Company, Inc.
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Mike Powers Maley & Wertz Industry Advocacy & Promotion Kevin Gillette Tioga Hardwoods Membership & Networking COMMITTEE CHAIRS Dave Mayfield Mayfield Lumber Co. Membership
Jennifer VanDyke Marketing Manager j.vandyke@nhla.com
Dave Bramlage Cole Hardwood, Inc. Promotion & Advocacy
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ADVERTISER INDEX
Orn Gudmundsson, Jr. Northland Corporation Structure
Kristina Thomas Community Manager k.thomas@nhla.com
Desirée Freeman Controller
For advertising inquiries: Contact John Hester, Director of Membership at j.hester@nhla.com or 901-399-7558.
Nordeck Thompson Thompson Appalachian Hardwoods Rules
Rich Hascher Inspector Training School Instructor John Hester Director of Membership and Business Development Becky Miller Inspector Training School Administrator Dana Spessert Chief Inspector
Jon Syre Cascade Hardwood LLC Convention Pem Jenkins Turn Bull Lumber Co. Nominating Steve Jones Ron Jones Hardwood Sales, Inc Inspection Services Orn Gudmundsson, Jr. Northland Corporation Finance Bucky Pescaglia Missouri-Pacific Lumber Co., Inc. ITS/Continuing Education Stephanie VanDystadt DV Hardwoods, Inc. Communications & Marketing Jeff Wirkkala Hardwood Industries, Inc. Member Value Joe Snyder Fitzpatrick & Weller, Inc. Rules Darwin Murray McClain Forest Products Strategic Planning
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PRESIDENT’S MESSAGE
CREATING NHLA 2.0 Just a few weeks ago, NHLA held a very different strategic planning retreat at its headquarters in Memphis, Tenn. Attendance at our past efforts only included the NHLA members, executive committee, committee chairmen, senior board members and past presidents. This time, planning committee Co-Chairs Darwin Murray and Orn Gudmundsson, Jr. reached out to many different participants, including younger members and representatives from virtually all member categories. Another key difference was that the NHLA Executive Team were active participants in the session. It’s incredibly important to have staff “buy in” of any strategy to ensure effective implementation. It was also very encouraging to know that despite 6 out of 10 NHLA members being close to retirement, we have plenty of excellent leaders coming behind them with the same passion for hardwoods as our founders. They brought with them very modern and dynamic ideas. I left the meeting convinced that NHLA’s future will be in good hands. I also have a new goal – to redouble our efforts to do a better job of connecting to this important group. Most strategic planning sessions are long on words and vision statements, and short on how to implement new ideas that NHLA members feel will move the industry forward. In the past, we seemed to focus more on the process than the output. This session created plenty of new and actionable ideas, many of which were focused on the need for NHLA to embrace new technologies to enhance member engagement and deliver a new generation of services. Like all good planning exercises, we spent some time looking at the current state of the industry and NHLA. Key issues included getting comfortable with the “New Normal” or the characteristics of doing business in our “post-recession” industry, exploding export markets, particularly what could be considered as an over-reliance on exports to China, labor shortages and of course, the generation shifts happening in hardwood companies across America.
connections through NHLA hosted virtual communities. Any of you who have been through a strategic planning process know that putting a plan on paper is relatively easy. Implementation can be hard. There is a lot of work to do between now and November, when the NHLA Executive team presents the final 2018 budgets and plan highlights for approval. The NHLA Board and staff are ready for the challenge and dedicated to producing the results that matter. I, for one am looking forward to being a proud member of NHLA 2.0
The results of our recent member survey also helped focus our discussions on the need for more effective promotion, including taking a stronger stance on anti-lumber activists, and doing a better job of keeping members informed on the changes in the industry. One of the most dynamic discussions related to the possibility of enhancing member engagement and value through the introduction of new technologies. Trade association staff and volunteers should always be a step or two ahead of our members, but not too much further than that. That’s a nice way of saying that NHLA’s transition into a technology enabled association will be an evolution, not a revolution.
Brent Stief, NHLA President Huron Forest Products
But just consider the possibilities of offering a technology enabled “hub” where members can access new educational programs or discussion groups based on current and future trends, conduct virtual business meetings on-line, or create new business 6
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CEO'S MESSAGE
THE PROMISE OF HARDWOOD CLT Brent’s letter does a great job of capturing the energy at NHLA’s strategic planning session last month, where industry leaders crafted the first stage of our next strategic plan. It was no surprise that in our recent member survey, promotion was top of mind of all participants. Like most conversations on the topic of promotion, the reasons why it is so important usually begins and ends with the negative impact of anti-lumber activists, the lack of consumer education on who “we really are” or our frustrations about losing market share to “faux wood” or medium density fiber board (MDF). Certainly, effective promotional strategies can help regain lost market share. Equally important is its role in identifying new market opportunities that have the potential to re-invigorate North American lumber sales. There is an opportunity just on the horizon that can provide the hardwood lumber industry the chance to do just that. Take for example, the recent unveiling of the Conversation Plinth, the first Hardwood Cross Laminated Timber (HCLT) structure in the U.S. at Indiana’s Exhibit Columbus. The structure is made of low value hardwood like common oak, maple and ash. Using low value hardwood to create high value construction – that is not a bad marketing strategy! The innovative architect behind the project, Yugon Kim, has described the “Plinth” as a proof of concept. While softwood CLT has been used across Europe since the early 90’s, Kim’s goal is to demonstrate the superiority of HCLT over softwood CLT in both residential and commercial construction projects. The journey from proof of concept to the acceptance of HCLT as a building material of choice has the potential to transform lumber construction in North America. Effective promotional strategies will play a key role in introducing this exciting new product to our members and consumers. Certainly, AHEC has led the way in demonstrating HCLT’s value in both small building and industrial size construction in Europe. What lessons can we learn from Mike Snow and his staff to apply what worked there to promote HCLT here in the U.S? We already know that HCLT construction is safer, more cost effective and environmentally friendly than traditional building materials. We also know that some of North America’s most innovative architects are excited about the promise of Hardwood CLT. Those are proven facts. We will need all the promotional tools at our disposal to help members take advantage of the promise of HCLT. Research, advocacy, member education, marketing communications and association partnerships will all play a role. One of the early stages of the promotion process is research. First, we need new research to create HCLT standards for the use of multiple low value hardwoods. Current standards are based on softwood CLT. Effective promotion of existing research will also be key, as will converting such research into member education. Equally important will be the opportunity to lead the creation of new industry 8
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and association partnerships to facilitate the use of HCLT as the construction material of choice, just as it around the world. Advocacy is also an important component of an effective promotional strategy. Our federal and state representatives should be called upon to support HCLT as an opportunity to reinvent the hardwood industry’s brand, create new jobs, and protect the environment. And finally, more research and marketing communications will be needed to connect the promise of HCLT to consumer needs. NHLA has one goal – to help its members prosper. We recognize the value our members place on promotion. Rest assured that the NHLA Promotion Committee chaired by Dave Bramlage is working hard on your behalf to develop a comprehensive and clear plan of action for moving forward. Stay tuned for more!
Lorna D. Christie, CEO 901-377-1082 direct | l.christie@nhla.com W W W. N H L A .CO M
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LABOR
There Ain’t Nothing Sexy ‘bout a Blue Collar Job, so Compete on Pride of Workmanship By Eric Chester, Award-Winning Speaker & Best Selling Author (www.ericchester.com)
R
ecently my wife commented on how much time I was spending watching the NFL Draft coverage on ESPN. “You’re a Bronco fan. They don’t pick again for an hour, at least. Are you really that fascinated by who Buffalo selects in the 5th round?” she asked.
And it’s not just pre-pubescent girls. When was the last time you heard of a teenager that aspired to be a welder on a pipeline in North Dakota? Or a diesel mechanic in Saginaw? Or a plastic lathe operator for an aerospace contractor in Baton Rouge? Or in this case, a lumber inspector for a hardwood sawmill in Jackson?
But there I sat along with 45.7 million other football fanatics glued to the tube for the third consecutive day of ESPN’s roundthe-clock, nonstop coverage of this ridiculously uneventful event.
Those kinds of jobs are plentiful, they pay extremely high wages, and they don’t require a four-year degree that often comes packaged with $50K in student loans. The problem with these kinds of jobs in construction and manufacturing is, quite frankly, they aren’t ‘sexy’.
Instead of being ashamed, I should take pride. After all, I am an American, and America is #1! We are the runaway, undisputed, world-class leaders in all things entertainment-related. When we’re not watching the Monday Night Game, the All Star Game, the Stanley Cup, Wimbledon, the Masters, the X-Games, or the gold medal ceremony for synchronized swimming in the Olympics, we’re watching the Oscars, Emmys, Grammys, CMA’s, and VMA’s. And when we’re not passively watching sports and award shows, we’re texting our votes for who we think should win The Voice, America’s Got Talent, So You Think You Can Dance? The X Factor, American Idol, Last Comic Standing, Dancing With the Stars, etc. STARS IN THEIR EYES The resounding message for anyone coming of age in today’s 24/7/365 entertainment-saturated world is crystal clear and stunningly profound: If you can’t become a movie star, rock star, sports star, or even a reality show star, you’re going to have to get a real job and be forced to live among the working class — and who wants to actually work for a living? A survey quoted in a recent article in Time magazine pointed out that three times as many middle school girls want to grow up to be a personal assistant to a famous person as want to be a Senator; four times as many of them would pick the assistant job over being a CEO of a major company. It’s a sad commentary when America is grooming youth who are so enamored with celebrity that they’d choose serving one over being a top-level leader in any field that’s not entertainment-related. 10
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The dichotomy that exists between the excellent jobs that are available in non-sexy fields and what today’s young Americans have been conditioned to believe they are entitled to is astounding. Until that gap narrows, we will continue to hear the loud grumblings of employers who are less than thrilled with the labor pool, and those disenfranchised young workers who comprise it and feel deserving of a job and a title that will impress their peers. ON POINT for EMPLOYERS - Face the facts: you aren’t going to convince a millennial that a job in manufacturing is as appealing as being a rock star or the next LeBron James. The good news is, it doesn’t have to be. Just be aggressive in your search for opportunities to expose the teens in your community to the jobs and opportunities that exist within your company and/or industry. Get them thinking about how cool it is to make things with their hands and how proud they will be when they have created something from nothing. Support any industrial arts programs that are being taught in your school system. The sooner you can reach a kid in their education, the better your odds will be to opening their mind to a promising and rewarding career in your industry.
Friday, Oct. 27 at 8:30 am. Come to the NHLA Town Hall Meeting and hear Eric Chester, our Friday Keynote Speaker at the 2017 NHLA Annual Convention and Exhibit Showcase in Nashville. W W W. N H L A .CO M
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FAMILY BUSINESS
Next Generation Preparation By Deb Houden, The Family Business Consulting Group (www.thefbcg.com)
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ne of the best ways to develop the next generation is to let them make decisions, enjoy the fruits (and suffer the consequences) of those decisions, and have a supportive cast in the senior generation and non-family key managers. Juniors need to start by communicating where they see themselves in five, ten, twenty years. If Junior does not know where they see themselves (and that is okay), he or she’s not ready to assume the path towards running the company. Hopefully the company has a policy about the educational needs of family in management (hint: if you do not have one now, develop a family employment policy especially regarding assuming a management position). If all of the key non-family managers are required to have a college degree, Junior needs to have one, too. If a trade school education is necessary, then Junior needs to get one, too. If there are management deficiencies, executive education classes or a community college class can be helpful. Sometimes a graduate degree, such as an MBA, is required. Junior needs to talk with Senior and key upper management to get a frank assessment on their educational deficiencies. Second, Junior needs to find out what type of experience they need to be a competent leader. Many family businesses require junior family members to work in other similar-type businesses before being employed by the family business, and then hire them only when a position that matches the skills of Junior opens up. This accomplishes three things: 1) develops Junior’s competence in an objective environment; 2) shows non-family employees that Junior is held to the same standards as everyone else, so there is more buy-in towards Junior when they do become a part of the
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family business; and 3) develops Junior’s own confidence in that they have earned their position, can make it in the outside world on their own, and are ready to take on more challenges. Third, Junior needs to develop relationships with outside advisors, such as bankers, accountants, lawyers, and financial managers and inside key non-family managers. Many of these advisors have a relationship with Senior, and do not really know Junior on a business level. Junior needs to take the initiative to develop these relationships. To be sure, Junior can ask Senior to accompany him on a visit to the outside advisors, but only as an introductory role. Junior also needs to take the initiative to develop relationships with senior managers within the company. These key non-family managers have a lot of knowledge about the business, and Junior can benefit in many ways. One, these key managers have a lot of knowledge about the inner workings of the business. In addition, when Senior steps down, Junior’s path will be less rocky if he has the buyin from key non-family upper management. Fourth, Junior needs to assume financial responsibility. This starts with understanding the different liquidity options available in the family business from buyouts, stock redemptions, dividends, and bonuses. Junior could also assume financial responsibility by assuming financial risk. Financial risk can mean guaranteeing loans, starting satellite companies, or buying out inactive shareholders. Fifth, Junior needs to make sure their role is clearly defined within the family business, know how they are being measured on her role, and who is holding them accountable. One of the biggest mistakes family businesses make is not having clearly defined roles for family W W W. N H L A .CO M
members, even though non-family members’ roles are usually clearly defined. Junior can start by listing all of their responsibilities that they do from day to day, and the odd things that get thrown on their plate. If they cannot list their responsibilities, there is a bigger problem: they do not know what they’re supposed to be doing. It is hard to accomplish a task if you do not know what it is. Finally, Junior needs to reshape communication with Senior. Who does Junior need Senior to be at any given time? Parent or boss? Junior needs to verbally let Senior know what role they need to play: parent or boss. Sometimes Junior needs to vent to their parent; other times, Junior needs to talk to their boss. Junior needs to communicate that. In addition, Junior needs to start communicating with Senior (and advisors and key non-family managers) in an adult-like fashion. Acting as a child within the business undermines the credibility of Junior in the eyes of everyone involved. By Junior assuming an adult posture, they raise their credibility level and earns the confidence of everyone involved.
NEXT MONTH: Letting Go! Deb Houden is a senior consultant with The Family Business Consulting Group, she specializes in helping family-owned businesses with family communication, transition and next generation development by providing resources, tools and knowledge that are needed to navigate their specific issues. Deb has worked with numerous families on developing effective communication and conflict resolution skills, developing family meetings, beginning stages of board development, and working with next generational members of family firms (including adolescents). She is adept at developing processes that help families go through changes within the business and family systems.
Thursday, Oct. 26 at 1:00 pm. Come hear Deb Houden speak at the 2017 NHLA Annual Convention and Exhibit Showcase in Nashville.
She is a regular presenter to industry groups, family business centers, and individual company retreats on topics including the next generation and succession, communication and conflict resolution, and perceptions of fairness.
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What Is
HARDWOOD ADVOCACY And Why Should You Be Involved?
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hen the NHLA member survey was completed earlier this year, members identified advocacy as one of the most important values NHLA offers. Members asked for consistent messaging in our advocacy efforts, and want NHLA to be more active.
While everyone pretty much agrees that advocacy is important, there is not always agreement on exactly what we mean by advocacy. To some members, advocacy is ensuring the industry's voice is heard when federal or state legislation is being considered. To another, it is increasing public awareness of the value and impact of the hardwood industry. As with the proverbial elephant, different people have different perspectives. Advocacy is defined by Merriam-Webster as “the act or process of supporting a cause or proposal”. As a member of the National Hardwood Lumber Association you are supporting the efforts of the Hardwood Federation, who represents thousands of hardwood businesses in every state in the U.S. and acts as the industry’s advocacy voice on Capitol Hill. NHLA is the largest contributor to the Federation, giving 10 percent of all dues collected annually to the Hardwood Federation. Every fall, the Hardwood Federation holds a Legislative Fly-In. At the time of this writing 45 individual companies and hardwood industry associations including NHLA, have registered to attend. The two-day meeting is a unique opportunity to put before our elected officials the issues that impact not just our core industry, but what also impacts small business and manufacturing. This is your chance as an NHLA member to ensure our elected officials understand the contributions NHLA members make to our local and national economy. The more people who converge on Capitol Hill, the greater the impact. I recently heard someone describe the hardwood industry as “invisible.” I took that as meaning that we are an industry that no one really thinks about and takes the benefits for granted. Attending the Federation Fly-In, advocating for the 14
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ADVOCACY
“the act or process of supporting a cause or proposal.” Suzanne Bonamici (D-OR, 1), Jim McDermott (D-WA, 7), Elizabeth Baldwin, Derek Kilmer (D-WA, 6), and Kevin.
industry on the state and local level are all ways that you can make the hardwood industry be SEEN and HEARD. Recently, Kevin Gillette, President of Tioga Hardwoods sat down with NHLA for a conversation about advocacy. Founded in 2000, Tioga Hardwoods is located in Berkshire, New York; employes 48 people and has been an NHLA member since 2002. In addition to serving on the NHLA Board of Managers as Mission Leader for Membership and Networking Committees, Kevin also serves as a board member for the Tioga Chamber of Commerce and the Tioga County Industrial Development Agency. He also serves as a Trustee of the WJ Cox New York Lumbermen’s Insurance Trust Fund. NHLA: What does advocacy mean to you and specifically to the hardwood industry? Gillette: Promoting the industry as a whole and spelling out the benefits of using hardwood products. We all have a chair or dresser that was in Grandmas house but not many of us are walking on the same sidewalk built that year. Our products are 100% renewable, environmentally friendly and safe, and rural employment in the industry is vital to the overall economy. Telling this story is what I see as advocacy. NHLA: What was your first legislative advocacy act? Gillette: In 2006, the Tioga County Chamber of Commerce selected Tioga Hardwoods as business of the year. At the awards' dinner we had a chance to meet with several of our Representatives. I had a good conversation about our business with Senator Tom Libous who represented the 52nd district in the state of New York. These types of events can be very helpful just getting in the same room with people and letting them know what we do, how many W W W. N H L A .CO M
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people we employ, how much product we export and the related businesses we work with in support of our daily activity in the community.
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NHLA: NHLA is the largest single contributor to the Hardwood Federation, giving 10% of all dues collected. As an NHLA member, what does that statement mean to you? Gillette: I feel that our support of the Hardwood Federation through NHLA dues is a vital component of the Federation’s success. We are a fragmented industry that is full of family-owned businesses and at times it is difficult to bring those businesses together to help advance our future success. There have been attempts in the past to bring the industry together as one voice that have failed. We do need a voice in DC that supports our industry and our agenda. The Federation is that voice and I hope it continues to be a vital part in uniting our industry. NHLA: When did you attend your first Hardwood Federation Fly-In? And what factors compelled you to attend? Gillette: Four years ago, I was a member of the NHLA advocacy committee and as a committee member I felt compelled to attend. NHLA: What was your biggest “ah-ha” moment during your first fly-in? Gillette: Government is really somewhat accessible but it takes cash to really get an ear. The Federation does a great job of organizing the meetings. If you take the time to go you will enjoy the visit. NHLA: What advice do you have for other hardwood industry businesses about advocacy? Gillette: Everyone should be involved at some level. All of us can say we don’t have time for this type of action but in the end we all need to make time. If everyone spent 48-72 hours a year working in some fashion to promote and advocate on behalf of the industry it would make a big difference. One visit to a representative in your county or state; one letter, phone call, invite to a company event or any outreach makes a difference. NHLA: What advice do you have for NHLA about advocacy? Gillette: We need to do more of it and get better at bringing the many state hardwood related associations together in support of that effort. If we could take the same type of strategy of the fly-in and work it through the associations for the same type of targeted meetings at state levels it would have a great impact. I know there are many efforts similar but I feel if they were all tied back to one organization it would have greater overall impact nationwide. If that organization needs to be the Federation then NHLA needs to be in full support. To learn more about the Hardwood Federation, Federation Fly-In and the Hardwood Federation Political Action Committee (HFPAC) visit www.hardwoodfederation.com or contact Dana Cole, Executive Director at dana.cole@hardwoodfederation.com. If you can’t join NHLA and the Hardwood Federation in person this September, check us out on Facebook @NHLA_Official for our LIVE Video from the Fly-In. W W W. N H L A .CO M
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ADVOCACY
THE FALL AGENDA By Dana Cole, Executive Director Hardwood Federation
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he autumn months are always busy ones in Washington, D.C. After returning from their traditional August recess, Members of Congress are usually eager to get back to work. The fall of 2017 is also important as those up for re-election in 2018 work to show their constituents that they have been making progress and effecting the changes that voters want to see.
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The Hardwood Federation is supporting H.R. 2936 which authorizes categorical exclusions to the National Environmental Policy Act (NEPA) and allows timber sales on federal lands to move forward more quickly.
The Hardwood Federation is working on a number of issues on behalf of the industry during the final months of the year. Priority issues include:
FEDERAL FOREST MANAGEMENT: Meaningful reform of the U.S. Forest Service management of our national forest lands has been close in the last few years, but has never quite crossed the goal line. The Hardwood Federation is supporting H.R. 2936 which authorizes categorical exclusions to the National Environmental Policy Act (NEPA) and allows timber sales on federal lands to move forward more quickly. The bill would also provide a solution for the fire funding issues that have plagued the Forest Service and allow expedited environmental analysis, essentially an action vs. no action decision, for certain collaborative forest activities on lands suitable for timber production or covered by a community wildfire protection plan. The Federation is strongly advocating for this bill to move forward and be taken up by the Senate. TAX REFORM: The White House, and both Houses of Congress are focused on taking up tax reform in the fall. The Hardwood Federation will be advocating for measures that bring relief to small business owners, facilitate the transfer of family owned properties to the next generation (including additional reduc18
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Community Wood Energy Program (CWEP) tions to the inheritance tax) as well as supporting tax measures that help private forestland owners retain their lands as forests (and as a vital source of raw materials for the industry). The Federation is also supporting measures that would help increase demand for sawmill residuals, which has quickly emerged as a significant issue for the industry. Specifically, we are proponents of the Biomass Thermal Utilization Act (BTU ACT) which would qualify high efficient biomass heating systems that run on wood pellets or wood chips for the same investment tax credits (30 percent of installed cost) that wind, solar, geothermal and other renewables get. The heating systems can be whole home units or commercial heating systems. We are also supportive of the Community Wood Energy Program (CWEP) which
Specifically, we are proponents of the Biomass Thermal Utilization Act (BTU ACT) which would qualify high efficient biomass heating systems that run on wood pellets or wood chips for the same investment tax credits (30 percent of installed cost) that wind, solar, geothermal and other renewables get. provides grants to projects that install wood heating systems in hospitals, schools, community centers and entire towns. Although CWEP is authorized by the Farm Bill, it has remained unfunded. We are working to change that and are asking for a funding level of $50 million annually to be approved. EXPORT PROMOTION FUNDING: The Hardwood Federation is a long-time proponent of full funding for the Market Access Program (MAP) and the Foreign Markets Development Program (FMD), both administered by USDA as authorized in the 2014 Farm Bill. These programs provide essential resources to support the development of foreign markets for U.S. hardwood and hardwood products. The American Hardwood Export Council (AHEC) receives funding from both programs allowing W W W. N H L A .CO M
(
Although CWEP is authorized by the Farm Bill, it has remained unfunded.
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them to provide vital services to the hardwood industry in the form of hardwood export promotion activities around the globe. This fall we are working to ensure that full funding is included in the 2018 spending bill while at the same time working for full . . . or increased . . . funding for these programs is included in the 2018 reauthorization of the Farm Bill.
thank you! MEET OUR 2017 NHLA ANNUAL CONVENTION & EXHIBIT SHOWCASE SPONSORS
To ensure that full funding is included in the 2018 spending bill BIOMASS: Although President Trump signed legislation that recognizes the carbon neutral and renewable nature of forest-based biomass fuels, there is still work to be done to ensure that this language remains in perpetuity. The law enacted earlier this year that included the necessary language expires in September and the Hardwood Federation and our allies are working with our supporters in Congress and the Administration to move forward new language that will eliminate any chance of our victory lapsing. Of course other issues are sure to come up and we will be ready for them. We appreciate the incredible support of the NHLA membership and look forward to sharing the latest updates from D.C. . . . and hearing directly from you about how you view activities in our nation’s capital . . . at the NHLA Convention in October.
“Necessary
PRESENTING SPONSOR WALNUT LEVEL ROSSI GROUP
ALDER LEVEL
CASCADE HARDWOOD LLC
CHERRY LEVEL
ALLEGHENY WOOD PRODUCTS ALLY GLOBAL LOGISTICS, LLC BAILLIE LUMBER CO. BPM LUMBER, LLC COLE HARDWOOD, INC. PENNSYLVANIA & INDIANA LUMBERMENS MUTUAL INSURANCE CO. THOMPSON APPALACHIAN HARDWOODS INC. U•C COATINGS, LLC USNR
MAPLE LEVEL
language expires in
September”
ABENAKI TIMBER CORPORATION ATLANTA HARDWOOD CORP. FRANK PAXTON LUMBER MATSON LUMBER CO. MOSS LUMBER INDUSTRIES, INC. NORTHWEST HARDWOODS SII DRY KILNS TRN USA TIOGA HARDWOODS TURNBULL LUMBER CO.
RED OAK LEVEL
A.W. STILES CONTRACTOR ACES DIVISION OF KUEHNE + NAGEL INC AMERICAN WOOD TECHNOLOGY, LLC BREEZE DRIED INC. CONTINENTAL UNDERWRITERS INC. COOPER MACHINE CO., INC. EPICOR SOFTWARE CORP. EULER HERMES NORTH AMERICA JIM C. HAMER CO. LICO MACHINERY INC. RORABAUGH LUMBER CO. SCS FOREST PRODUCTS BY FINNA GROUP THOMPSON HARDWOODS, INC. VISIONTALLY WESTON PREMIUM WOODS WHEELAND LUMBER CO., INC.
As of to date 8/18/17
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RULES CORNER
THE NHLA SALES CODE: DEBUNKING COMMON MYTHS By Dana Spessert, NHLA Chief Inspector
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his month’s Rules Corner will kick-off a series of articles focused on the underutilized and often misunderstood NHLA Sales Code.
The NHLA Sales Code was first drafted by the Lumberman’s Club of Memphis and proposed to NHLA as a means of self-governance over the proper procedure for hardwood lumber transactions and dispute resolution. It was first adopted on June 23, 1922 in response to a meeting held by the Commerce Secretary of the United States for the wood industry. The Sales Code gave the U.S. government confidence that NHLA had the authority to oversee an industry with regards to fair trade of hardwood lumber. One of the most misunderstood parts of the Sales Code relates to purchase orders and/or sales contracts. On page 77 of the 2015 NHLA Rules Book, under the heading National Hardwood Lumber Association Sales Code: This Code is binding between buyer and seller only when it is specifically stated in the contract that it shall govern. If this is listed on the contracts, email orders, faxed orders or similar documents, then the Sales Code will be utilized in the transaction and address many different areas of concern. The purposes of the Hardwood Sales Code as listed on page 77 of the NHLA Rules Book are as follows: 1. To establish uniform practices in the conduct of transactions, involving the sale and purchase of hardwood lumber, by defining in plain unequivocal terms, the approved customs and usages of the trade under which such transactions are conducted. 2. To supply reasonable regulations governing elements of transactions that are not already covered by established customs.
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There are a total of 13 Articles included in the Sales Code covering everything from the name of the companies to arbitration. I have highlighted article IV dealing with “orders” as this is an area often overlooked or misunderstood. Please read each one carefully. Article IV, “Orders”: Section 1. The term “order” refers to a contract of sale and purchase existing between seller and buyer. Section 2. All orders should be in writing and should specifi- cally embody all provisions of the agreement of sale and pur- chase, to-wit: Kind, variety, quantity, dimensions, grade, manufacture, age, inspection, point of delivery, time of ship- ment, price, terms of payment, etc. Section 3. An order taken by a salesman is not binding upon the seller until it has been accepted in writing by competent authority or until delivery under the order has begun, and in the absence of either of these forms of acceptance, it is subject to cancellation by the buyer. Section 4. Any provision or provisions omitted by the buyer from his formal order may be supplied by the seller, or any provision or provisions contained in the formal order may be amended by the seller in his acceptance of the order, but such additions or amendments do not become a part of the contract sale and purchase until they are specifically accepted by the buyer. In Section 3 above, an order that is not in writing is subject to cancellation by the buyer. By providing a contract between the buyer and seller there is some protection from receiving the wrong material at the wrong price, which in today’s world with just in time inventories, can mean the difference between survival and bankruptcy.
3. To provide practical and responsive means for the settlement of disputes arising between sellers and buyers of hardwood lumber, without recourse to litigation.
I realize that in today’s environment with cell phones, emails and other instant communications that the importance of formalized purchase orders and contracts have been diminished, but I like to compare that to the Titanic, no one thought that it would sink either!
It is my opinion that the industry understands some areas of the Sales Code but I would like to take the time to fully explain the entire Code starting with “Orders”.
In next month’s article, I will continue this series with an explanation of “Delivery, Time of Shipment and Contingencies”.
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EDUCATIONAL CALENDAR
EDUCATION & TRAINING SEPTEMBER
11-15 Intro to Lumber Grading Kamps Hardwoods Caledonia, MI Instructor: Barry Kibbey, NHLA National Inspector
SEPTEMBER
12-14 ! w e N
3-Day Walnut Only Grading Short Course
Missouri-Pacific Lumber Fayette, MO Instructor: Benji Richards,
SEPTEMBER
18-22 Intro to Lumber Grading Wood-Mizer Products, Inc. Indianapolis, IN Instructor: Barry Kibbey, NHLA National Inspector
NHLA National Inspector
SEPTEMBER
New! 26-28
3-Day Walnut Only Grading Short Course Ohio State University South Centers Piketon, OH Instructor: Benji Richards, NHLA National Inspector
OCTOBER
OCTOBER
2-6
16-19
Intro to Lumber Grading plus Yield Analysis
Intro to Lumber Grading
Ohio State University South Centers Piketon, OH Instructors: Tom Byers and Benji Richards,
West Virginia Wood Technology Center Elkins, WV Instructor: Barry Kibbey, NHLA National Inspector
NHLA National Inspectors
*See all course offerings and register at www.nhla.com/calendar 22
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EDUCATION IS KEY TO YOUR COMPANY’S SUCCESS Register Online Today! At www.nhla.com "Graduated in the 134th class. Was a great learning experience. Such a fantastic school and the instructors were the best ever. I would advise anyone who has the opportunity to go, not to pass it up." — Kimberly Campbell, Inspector Training School 134th Class
OCTOBER
NOVEMBER
JANUARY
JANUARY
30-Nov 18
27-Dec 8
3-March 24
29-Feb 1
Inspector Training School Progressive Program - Block 3
Inspector Training School Progressive Program - Block 1
Inspector Training School 185th Class
Intro to Lumber Grading
NHLA Headquarters Memphis, TN
NHLA Headquarters Memphis, TN
NHLA Headquarters Memphis, TN
Mattie Lanier Richey Center Atlanta, Texas
Instructor: Rich Hascher,
Instructor: Rich Hascher,
NHLA ITS Instructor
MARCH
MARCH
APRIL
5-24
19-23
9-21
Inspector Training School Progressive Program - Block 3
Intro to Lumber Grading
Inspector Training School Progressive Program - Block 1
NHLA ITS Instructor
NHLA Headquarters Memphis, TN Instructor: Rich Hascher,
Instructor: Benji Richards,
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NHLA National Inspector
Instructor: Benji Richards, NHLA National Inspector
NHLA ITS Instructor
Maysville Communmity and Technical College Morehead, KY
NHLA ITS Instructor
Instructor: Rich Hascher,
NHLA Headquarters Memphis, TN Instructor: Rich Hascher, NHLA ITS Instructor
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Let's take over Music city
DON'T MISS OUT Register for the 2017 NHLA Convention Today!
JOIN US October 25-27 h 2017 NHLA ANNUAL CONVENTION & EXHIBIT SHOWCASE | NASHVILLE, TN More information and registration online at www.nhlaconvention.com