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October 2007 - The Logging and Sawmilling Journal

ADDED-VALUE MANUFACTURING

BETTING ON BALSAM

An association of woodlot owners in Quebec’s eastern Gaspé region is betting there’s a market for rustic furniture manufactured from that most popular of Christmas trees: the balsam fir.

By Martine Frigon

Balsam fir, a tree available in very large quantities in Quebec, has a narrow, pointed, spire-like crown of spreading branches and aromatic foliage. It has been used by sawmills to produce lumber for construction markets, as raw material for the pulp and paper industry and for mouldings and planking—and it is also a preferred Christmas tree.

Now it turns out that this evergreen tree could be very well-suited for the manufacturing of furniture with a rustic look, according to the heads of the Société d’exploitation des ressources des Monts (SERM), an association of woodlot owners in Matane, in the province’s eastern Gaspé region. Realizing this wood had not yet been used for this type of product on the Canadian market, they took the plunge several years ago and formed a subsidiary called Sapin des Monts (balsam fir of Monts).

	Ghislain Miousse (left), executive director of the Société d’exploitation des ressources des Monts (SERM), an association of woodlot owners in Quebec, with some of the rustic furniture the association is manufacturing through a subsidiary.

Created in 1974, SERM is one of 44 associations of woodlot owners in the province. Quebec has a total of 25,770 owners of some 1.3 million hectares of woodland.

The associations provide seasonal employment to 2,550 workers in silviculture and other forestry operations—in heavily rural and isolated villages with few available jobs—as well as jobs for about 100 forest engineers and biologists, and about 500 forest technicians.

With annual revenue of $4 million, SERM has 600 owners of 800 woodlots in the Matane area, providing seasonal employment to more than 115 people.

The Smurfit-Stone paper mill and Tembec, both in Matane, Bowater-Mitis (about 50 kilometres away), and regional sawmills, like Cédrico, Lulumco and Félix Huard, are its main clients.

“If not for these jobs, people would practically have no work here. It helps a lot to ensure the survival of some of the villages,” says Ghislain Miousse, SERM’s executive director.

All available jobs are currently filled, but there may be an opening for a chainsaw operator in the near future. Finding someone to fill such positions may not be easy, a situation that SERM shares with the industry in the rest of the province, and the country, for that matter.

“Currently, most of our operators are more than 50 years old. Young people are not really interested in this kind of job because of the physical conditions. They’d rather be loader operators or do silviculture activities. We could have a problem in coming years,” Miousse adds.

When it started to manufacture balsam fir panels and furniture, SERM’s main aim was to create a value-added operation to complement primary production. It took three years to start up the company; its directors studied the market, wood processes, and product development. Under the brand name Sapin des Monts, the company was officially launched in July 2004, with an investment of $70,000 and grants of $250,000 from the Quebec government and $89,000 from Canada Economic Development for the Quebec Region.

Sapin des Monts produces kitchen tables and chairs, credenzas, beds, benches and office furniture, all made of balsam fir. Recently, the company began to manufacture cupboards.

Despite their optimism with this new venture, the rise of imported products meant sales forecasts could not be reached. “At first, we wanted to put the emphasis on panel production, and on the properties of balsam fir, especially on its toughness,” indicates Miousse. “Our strategy was to aim for 60 per cent of our sales in panels and 40 per cent in furniture.”

However, because of competition from foreign producers, they were unable to hit their sales target. “In July 2004, at the same time that we launched our subsidiary, much cheaper priced, woodbased panels from other species imported from Poland and South America, especially Chile, arrived on the Quebec market. The distributors we had started negotiating with—among them a national superstore—were no longer interested in selling our panels. This greatly affected us and we had to rethink our marketing.”

Miousse and his team then decided to focus on furniture manufacturing. “We created a distribution network through a dozen apparel and furniture stores in Quebec. I must admit we no longer want to become a superstore supplier. These companies only think about their markups and are not interested in distributing on a small-scale basis. We’re betting on other distribution networks.”

In June 2005, they took another step, opening a store in a Matane shopping centre. “We realized that our most faithful clients were in our region.

So we decided to go direct to consumers and open a store, and it’s working quite well,” Miousse explains. “We intend to open additional stores in other cities.”

Recently, they also began to develop a new market niche: country houses and secondary residences. “We formed a partnership with two contractors of round timber cottages: Chalet Huard, in l’Ascension in the Lac-Saint-Jean area, and Timberblock, in the Montreal area. Our products are complementary because our furniture, which has a rustic style, can fit perfectly with their cottages. They will suggest our furniture to their clients.”

Not only is the use of balsam fir in furniture manufacturing unusual, but the furniture is made from one-inch thick panels. The wood, processed at a local sawmill, is dried to seven per cent. “Our furniture is made to last for generations,” explains Miousse. “It has a toughness that unfortunately isn’t found very often on the consumer market.”

The plant, which has four cabinetmakers, uses equipment similar to that used by most carpenters. “Currently, the wood volume used is relatively low; we use 1,000 to 1,500 cubic metres annually, but we’ll increase the volume this year,” he adds.

Although wishing to remain outside the big distribution networks, SERM and its subsidiary Sapin des Monts have earmarked baby boomers as an important niche in coming years. “This age group likes rustic furniture and has a greater likelihood of buying a second home,” says Miousse.

They’re also betting on the association with the two cottage contractors. Other small-scale projects are in the works as well. “We believe that we can use balsam fir in the manufacturing of commercial furniture in a few specific niches.“

Dave Hanna, president of the Ontario Furniture Manufacturing Association, says the idea to produce furniture from balsam fir is interesting. “I have never heard of a project like this before—it’s quite original. I think that they could have success in the recreational market.”

Jean-François Michaud, CEO of the Quebec Furniture Manufacturing Association, says he doesn’t believe there are any other companies specializing in furniture made from balsam fir in North America. Companies must distinguish themselves in the market now and offer value-added products, he says. “They have my admiration. They use a type of wood that is much available in their region—and offer a creative product.”

Despite the praise and all the company’s initiatives, Sapin des Monts has not been able to achieve as much profit as expected. “We had forecast that sales would be four times what we obtained in 2005,” says Miousse. “Several times, we wondered whether we should close shop but we noticed, month after month and little by little, that there are trade opportunities opening. Our clientele continues to improve, which keeps us very optimistic.” And that optimism keeps them building rustic furniture from what has been an under-utilized wood resource and working away at developing that market.

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