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May 2005  - The Logging and Sawmilling Journal

SPECIALTY SAWMILLING

Resourceful Rouck Bros

Faced with the US countervail on its high-value cedar production, Rouck Bros Sawmill is being resourceful, exploring new markets and selling on the Internet.

By Paul MacDonald

BC sawmiller Doug Rouck admits that he, like most people using computer technology, gets frustrated with it at times. “There have been times when I’ve felt like taking the computer and throwing it out the window,” he says, laughing. Those times are few and far between, however, as Rouck Bros Sawmill—made up of Doug, his brother Earl, Earl’s son, Kevin, and 10 employees—has embraced computer technology, from the office to their mill, and even to selling product over the Internet through their own web site (www.rouckbros.com) and Internet giant, eBay. “It seems like you have to make sure you use technology if you want your company to be sticking around,” he says. “We’re not at the front of it, that’s for sure, but we’re sticking with it and trying to use it as much as we can.”

That extra e-commerce marketing has come in handy over the last several years as Rouck Bros Sawmill, which produces mostly cedar products, has been hit by the US softwood lumber dispute. Although the target of the US countervail is dimensional SPF lumber producers, it has slammed higher end wood product industries, such as cedar producers. It has effectively priced a lot of Canadian cedar right out of the American market. For example, the highest value product from Rouck Bros—tongue and groove cedar clears—looses its appeal when 27 per cent duty is added to the price. From its location in the town of Lumby in BC’s North Okanagan region, just east of the city of Vernon, Rouck Bros was sending most of its cedar production—in a variety of sizes—directly across the line to the US. But that trade has now dwindled in the face of the countervail and duty. Their overall production has been affected, and in a substantial way.

From the left: Kevin, Earl and Doug Rouck, at the Rouck Bros sawmill in Lumby, BC.

And it’s not like they could immediately switch gears, and just sell into another market. So true to form, they’ve been resourceful, gone to “Plan B” and worked to ramp up regional sales, and the electronic sales side of the business, through the Internet. Though this business has not replaced what they were selling to the US, it has helped offset the loss in sales. And making full use of the Internet represents a smart strategy in itself. Their equipment set-up puts them in a good market position, in that they have the ability—and the initiative—to produce everything from large timbers right through to garden furniture. The brothers learned the sawmill trade from their father, Jack, who operated a portable sawmill from the 1940s through to 1970. “We decided after that to set up something permanent because if you want to expand your equipment or production, you can’t be moving around all the time,” explains Doug. “The idea was to get into a broad range of products, and do the retail side, as well as the wholesale.”

On the equipment side, the headrig can handle timber up to 36 inches in diameter, which they don’t see too often. “Basically we saw second growth cedar, down to a four-inch top, with anywhere from a 12- to a 16-inch butt.” They also cut a small amount of Douglas fir for one-off orders, such as beams for log homes. Handling the smaller wood is a Baker band saw. Over the years, they have added equipment, and sold off equipment. In the former category they have added live decks, a Fink wood grinder, and set up a reman plant that includes a Pendu 5000 double arbour gang resaw, Doucette chop saws and a SCM moulder, SCM ripsaw, and a dry kiln.

    

Rouck Bros takes pride in being a specialty sawmiller, and having the ability to turn out a huge variety of products. “That’s really where we shine,” says Doug Rouck

The overall goal at Rouck Bros is to add value to the cedar, rather than just produce raw product. And doing this themselves also gives them a greater degree of control. They contracted out the remanfacuturing component for a while. “That was kind of a hassle,” says Doug. “We had to haul the wood over, bring it back, and then there was always some falldown that we had to deal with. So now we do all that.” They also found there was an improvement in quality control. While outside remanners do a good job, by doing it in-house Rouck Bros is able to exercise that extra degree of quality control and attention to detail. “The remanners are there to do what you ask them to do: reman your product. They’re not there to look after your product for you beyond that.” Doing the remanning themselves also means they can keep those costs internal, and it allows them to be very flexible in terms of production.

Rouck Bros takes pride in being a specialty sawmiller, and having the ability to produce a huge variety of different sizes and products. “That’s really where we shine,” says Doug. Their customers can range from someone local looking to do custom woodwork to a homebuilder in Japan or Europe. “Some of those house projects are interesting,” comments Doug. “They can be very demanding because there will be lots of different items that they are looking for to go into the house.” They have done a fair bit of business to Japan, but, Doug notes, “We’d like to do more.” With export sales, the initial contact is often by e-mail, using their web site. The mill will then send samples out, and overseas customers often end up visiting the mill in Lumby to see what they are capable of producing, and to see it produced first-hand. “The web site and e-mail have really paid off for us.” Domestically, they sell cedar products directly to hot tub manufacturers, local contractors, individual buyers, and on the wholesale side to various lumber companies across Canada.

Being a small producer, Rouck Bros does not have much of a problem sourcing wood. Depending on their level of production, they will use between 5,000 and 10,000 cubic metres a year. They have no tenure, so the main sources of wood are sortyards—such as the Kootenay Custom Log Sort and the sort run by the Revelstoke Community Forest Corporation—and private woodlots. “That’s worked out excellent for us. We are able to get what we need through the sortyards.” With woodlots, they tend to have to take whatever is in the bush, but that has worked out fine for them, as well, says Doug. Doug and Earl have thought of bidding on the BC Timber sales run by the province, but the quantities of wood on offer are well beyond what they need. “We don’t really want to be bidding on 40,000-plus cubic metres, only to log and sell most of it to one of the major mills in the area. That’s not what we want to do. Our business is to do something with the wood we buy.”

Being a small operation, the two brothers work in all facets of the operation. “We divide things up a bit, but we both try to be involved with everything to some extent so we have a good idea of the big picture,” says Doug. Generally, Doug handles the log buying, while Earl takes care of selling the lumber. “Earl could buy logs if he wanted to and I could sell lumber if I wanted to, but that’s just the way it’s worked out,” says Doug. And Kevin, Earl’s son, handles a good deal of the monkey-wrenching for the mill and its equipment. “If it gets too heavy duty, we will bring in someone from outside to help out, but we do a fair amount on our own, that’s for sure.”

When it comes to larger projects, such as transfers and conveyors, they’ll have it fabricated outside, but will work closely with the shop to make sure they get what they need. That helps to keep their costs down, which is always a goal for the operation, but perhaps even more so these days. Doug notes, however, that many of their costs are fixed; it’s not like they can go into the local fuel supplier and ask for a break on the cost of diesel because times are tight for them. “We basically just watch what we spend, what we need, and what we can do without. That’s how we look at it.”

This often translates into efforts at cost control that may not be huge, but that pay off. Example: in flusher times, they might carry a medium amount of steel inventory for ongoing projects. But these days that inventory pile is pretty small; if they need more, they’ll contact the supplier. Although the Rouck brothers, like the Canadian industry as a whole, hope for a resolution soon to the US softwood situation, they are looking beyond that. Kevin is spearheading a project to take added-value even further, and is looking to set up a woodworking shop to produce cedar garden products on more of a mass scale, although it would be a modest mass scale.

They are looking to manufacture furniture, planters and privacy panels. “It would help us better utilize our wood, and use the shorts and falldown,” says Doug. Their wood waste is currently ground up and used as bedding by local farmers. But they could take a look at changing that, and produce mulch or other landscaping materials. The shop would give some additional focus to the added-value work they do now. They can—and do—manufacture literally hundreds of different products, everything from hardwood flooring in birch, fir hemlock and pine to timbers as well as custom log homes. “We get people coming to us with all kinds of ideas of what they want, and we try to produce what they are looking for, regardless of what it is.”

And through the initiative of one tech savvy employee, the company is already selling its cedar planters through on-line auction house eBay. While eBay is generally known for auctioning all manner of items, a lot of them used, many companies are starting to use it as an on-line retailer, and seeing some real success. “We’re just starting with eBay, but we’ve had people phone up from all over the place and order our planters. We’ll bundle them up, and send them out by courier, which the buyers pay for.” Using e-commerce services such as eBay, “we can sell to anywhere in the world,” says Doug.                 

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