By Tony Kryzanowski
Two decisions taken early on in a sawmilling venture can significantly reduce risk and improve the chances for business success: taking on low or no debt and diversifying manufacturing operations.
Mardis Forest Products, located in southeastern B.C., is a good example of putting that approach into action, operating a high-volume commodity production branch in addition to a custom sawmilling division, while carrying no debt.
In other words, the company has options depending on market conditions, putting more effort into whatever area is generating the most income, depending on wood markets.
Veteran sawmiller Larry Gould has learned his lessons well over the past 28 years. As the saying goes, this isn’t his first rodeo.
Established in 1992, Gould says that Mardis Forest Products, located near the community of Skookumchuck, has come full circle, except that it has become a much more important employer in the region. It started with five employees and now employs 27 workers.
When the business opened its doors, it began by manufacturing 5/4” x 6” decking sold into the Japanese market, but that venture was derailed by health issues leading to an equipment auction. Gould cleverly held onto equipment he knew he’d need, to relaunch the business once he was well enough to do so.
“We slowly grew, but we did it my way, without any debt and using pieces of equipment that we picked up at various auctions throughout the province,” Gould says.
At present, the company is heavily invested into manufacturing 5/4” x 6” decking through a partnership with major forest company Canfor, which has also opted to produce this value-added product on their own, currently at the Radium sawmill. Mardis Forest Products supplements their program and has become a critical stepping stone for Canfor, to maximize its income potential from this product line. Gould already had the Ledermach 524 moulder and knives to produce the decking, from the business’s past, when producing and shipping decking products to Japan.
“It got to be a full time gig down here,” Gould says. “We were producing 15,000 board feet per day.”
Once Mardis Forest Products showed Canfor that they had the knowledge and experience to produce a quality product, the company was convinced, leading to a significant redesign of material flow at the Mardis sawmill, with proper infeeds, outfeeds and chains. The result was increased production, to between 25,000 and 30,000 board feet of production per day.
They also invested in a Ledermach 623SP moulder.
“These machines are phenomenally accurate, provided all the set-up is done correctly,” says Gould.
The manufacturing process starts with Mardis picking up and delivering 5/4” x 6” blank lumber from area Canfor sawmills. They then mould it into decking for such wholesalers and retailers as CanWel, Taiga and Stella-Jones. They also operate as a reload facility for Canfor, producing three different patterns of decking material, and shipping them directly to treating facilities, as required.
“The product itself is totally owned by Canfor,” Gould says. “We do the smaller orders.”
In addition to decking, Mardis Forest Products also produces high volumes of kiln sticks, lath and dunnage used extensively by the forest industry in both lumber production and shipping. In this instance, Mardis purchases 2” dimension lumber from Canfor to produce these commodities.
Then there is the custom sawmilling branch of the business, which represents about 30 per cent of their income. Gould says that it is a good moneymaker and in addition to being an important source of revenue, it also represents an insurance policy that he can fall back on should their ‘piece work’ programs ever suffer any serious setbacks.
In other words, while his partnership with Canfor is important and appreciated, Gould hasn’t put all their eggs in one basket and he has expanded his customer base to include other forest companies in the area, such as Louisiana-Pacific and CanWel.
One example of a product he manufactures for CanWel is a premium fence board using a Cantek HBR-300 resaw to custom saw and plane 2” x 6” lumber into 1” x 6”, in both 5’ and 6’ lengths. It is sold in a variety of retail stores, including Home Depot.
Gould’s custom sawmilling business attracts customers from all over Western Canada and parts of the U.S. Mardis Forest Products processes an exclusive diet of large diameter and long length Douglas fir, Western larch, and a bit of red cedar.
The backbone of this operation is a Wood-Mizer LT70 electric band sawmill, giving Mardis Forest Products the ability to offer anything up to 18” x 18” timbers, as long as 26’. The bandsaw mill only manufactures heavy timbers and 1” lumber, which is produced in dimensions generally between 4’ to 16’, but with the ability to produce lumber as long as 26’.
“We don’t keep stock, but fill orders,” explains Gould. “That material is already sold when it comes off the chain. We’ve cut millions of board feet on that Wood-Mizer. It never stops.”
When strictly focused on timbers, they can produce anywhere from 7,500 to 10,000 board feet per shift. Producing 1” material takes a lot longer but that is reflected in the price.
“Timbers go fast, but 1” material takes forever,” Gould says. “You have to receive the same dollar value from that 1” material as you would from the timbers.”
What’s working to Gould’s advantage is his location and his ability to deliver massive timbers to customers within a reasonable driving distance. Large diameter logs to produce these timbers are becoming more and more scarce. Up to 70 per cent of their custom sawmilling production is timbers, many of which are used by Canfor in their bridge construction program.
Mardis Forest Products uses a Wood-Mizer .050 kerf blade that is 1 1/2” wide on their bandsaw mill. Gould rates the blade’s quality and performance as excellent.
To support their bandsaw mill, they have invested in a computerized Wood-Mizer BMS250 blade sharpening and tooth setting system.
“It was probably one of the best tools that we could have acquired because the longevity of the blades probably tripled, going from four sharpenings to up to twelve sharpenings per blade,” Gould says.
This purchase has also helped the company save on labour because the system is computerized. It only takes minutes to sharpen and set a blade now compared to 20 minutes per blade using manual labor. Gould emphasizes that properly sharpened and set blades are critical, with his sawyers paying close attention to blade performance and recognizing the need for a change. An improperly sawn timber could result in the loss of $500 of income. He has great confidence in his sawyers, who have been with the company for years.
Mardis Forest Products has been the epitome of stability in what has been a highly volatile work environment, with a number of sawmills closing or changing hands in southeastern B.C.—and Gould has helped a lot of local residents over the years. He has a long history operating in that area and has built many business connections. Today, he employs many of the individuals who worked for bigger sawmills and whom he regularly dealt with. The business has come full circle in more ways than one.
Even though Gould knows he can decide to focus on custom sawmilling exclusively anytime he wants, he feels responsible for keeping these individuals employed. Even during the recent COVID-19 business downturn, he waited till the very last minute to issue layoff notices, reacting only when Canfor itself had scaled back operations. Those individuals have since been hired back.
In yet another example of how Gould has paid it forward, his yard served as a storage and delivery site for a massive amount of hog fuel accumulated at a local sawmill. The hog material, which sometimes consisted of as many as 10 piles on 25 hectares of land, was shipped to a local pulp mill for fuel in a cogen plant. Initially the contract was for a few months. It lasted 4.5 years, provided employment for about a dozen seasoned workers who had been laid off when the sawmill in Canal Flats closed, and provided extra income for Mardis Forest Products to help upgrade their equipment line.
“I almost feel obligated because they have come to work for me,” he says. “It’s not just a matter of money anymore; it’s friends who are counting on me for day to day sustenance. I enjoy having those individuals around, and we have put quite a team together. My employees
are number one.”
Strong faith, no debt and diversification have all helped B.C.’s Mardis Forest Products survive in turbulent times.
The custom sawmilling branch of Mardis Forest Products is backstopped by a Wood-Mizer LT70 bandsaw mill that produces mainly timbers and 1” lumber.
Mardis Forest Products owner Larry Mardis (above) has seen his business come full circle. Starting originally with five employees, he now employs 27 workers, some of whom he dealt with at other sawmills when first starting out, but who found themselves unemployed with those sawmills closed.
On the Cover:
The last several years have been busy for B.C.’s Lizzie Bay Logging. In that time, in addition to diligently carrying out active logging activities during COVID, the company has become joint owner of a custom sawmilling business, acquired a towboating company, launched a concrete company—and started a tree services business. Read all about the company’s successful diversification beginning on page 12 of this issue. (Cover photo courtesy of Lizzie Bay Logging)
Filling the need for fallers
There’s a shortage of certified fallers in B.C.—but fallers in training like Melie de Jonge are helping to fill that need, with the help of veteran faller—and certified instructor—Richard Butler.
Playing defense in forestry game
Veteran B.C. logger Clint Carlson is playing defense to weather today’s skewed business environment in the forest industry.
B.C.’s Lizzie Bay Logging is still very focused on logging, but is also finding success in diversifying its business.
Solid formula for sawmill survival
Strong faith, no debt and diversification have all helped Mardis Forest Products survive in turbulent times.
Pivoting to pre-finished products
Ontario’s Muskoka Timber Mills has made a successful market pivot to custom, pre-finished wood products, rebuilding after a devastating mill fire.
Tapping into an under-utilized fibre resource
A Haida-owned company in B.C. is working with under-utilized fibre, harvested sustainably, along with a custom sawmill operation, to produce value added wood products.
Included in this edition of The Edge, Canada’s leading publication on research in the forest industry, is a story from the Canadian Wood Fibre Centre (CWFC).
The Last Word
Tony Kryzanowski notes that West Fraser Timber is investing in the future as Canadian softwood lumber producers face a tough year ahead, after some pretty flush times during COVID.