March 17, 2016
ARAUCO NORTH AMERICA SPRING NEWSLETTER
COMPANY OF CHOICE
Kelly Shotbolt, President of ARAUCO North America
Being in business always provides for interesting and tumultuous times, and this period is no different. Geopolitical tensions, weakened emerging economies creating surplus capacities and commodity price declines, and re-calibrated currencies that influence trade flows are all part of the existing landscape.
We are choosing to face this new reality by boldly embracing the opportunities of this challenging and dynamic environment. Our North American business is much stronger today after we became part of the ARAUCO family. We can serve our local customers with a much broader array of products from North America, South America, and soon from Europe.
ARAUCO has built an important global forestry business by embracing a philosophy that rewards investment in plant, equipment and people. We compete internally for the financial resources required to build new plants, and are pleased that the most recent investment plans have been allocated to our North American operations. This is not because of government incentive programs, labor cost advantages, or because of barriers, walls, or other disincentives preventing imports, but rather because these "long-term" investment decisions are being made to produce products in the locations that best meet the needs of our customers. Across our operations we benchmark and share best practices in a continuous effort to be better, we leverage the inherent advantages that one jurisdiction may have whether it be the growing conditions for our forests, technological competence of our workers, or supply-chain considerations that contribute to effectively meeting customer preferences.
To that end, meeting our customer’s needs remains paramount in our approach. But after some reflection, we felt that to be the best supplier, we needed to take a more holistic approach and have accordingly branded our various company initiatives under the banner "Company of Choice".
To be the best supplier, we need good supply partners and most clearly nothing happens without good people. Therefore, the "Company of Choice" initiative captures our aspirations to be the company that others want to "sell to", "work for", or "buy from". We are challenging each of our employees to fulfill their roles in this exciting initiative, and to ensure our business success through the success of our employees, suppliers, and our customers.
ARAUCO POISED FOR LARGEST IWF IMPACT EVER
For four amazing days this coming August, the industry hits the pause button.
It’s the International Woodworking Fair (IWF), the world’s largest gathering of its kind, and it’s set for August 24-27 at the Georgia World Congress Center in Atlanta, GA. Attendance this summer will likely top 25,000, with top industry professionals visiting from all 50 states and over 75 countries. ARAUCO will be at the center of this year’s action like never before.
The most prominent example of this is ARAUCO’s new booth. While still in final development, it will be the platform to present exciting, new products to the market.
“IWF is a show that we all look forward to; it’s the largest gathering of our representatives and customers. With that in mind, we always aim to make our booth dynamic and inviting for our visitors,” says Gillian Matthew, ARAUCO Trade Marketing and Merchandising Manager.
Even more important is the team representing ARAUCO at IWF. She estimates up to 40 ARAUCO associates will attend, including the entire North America senior leadership team:
• Kelly Shotbolt, President
• Jake Elston, Vice President of Corporate Operations
• Jose Manuel Bezanilla, Chief Financial Officer
• Kevin Shotbolt, Vice President of Sales and Marketing
• Russ Jordan, Vice President of Sales
Matthew is pleased to report Gonzalo Zegers, Senior Vice President of International and Business Development, will also join the team at IWF.
“For ARAUCO customers, it’s a prime opportunity to have face-to-face meetings with our leaders. Customers can ask questions, receive the latest information, and learn about our new products and services,” Matthew says. “It’s truly the year’s most exciting industry event!”
Circle those August dates, and be sure to visit us in 3237. It’s Fair time and ARAUCO will be there to make the most of the industry’s biggest semi-annual gathering.
“OUR VIEW IS LONG TERM”
A Conversation with Gonzalo Zegers, ARAUCO Senior Vice President International & Business Development
Talk with Gonzalo Zegers for even a brief time and three things immediately emerge: superb listening skills, humility, and an abiding respect for the North American marketplace.
Gonzalo Zegers is Senior Vice President of International and Business Development of ARAUCO, the parent company of ARAUCO N.A. (North America). ARAUCO is a world-leading forest products company based in Chile that entered the North American marketplace in 2012. Zegers has played an instrumental role in building ARAUCO N.A., including the acquisition of Flakeboard, authorizing several other major mill acquisitions and expansions,and more recently, the announcement of a $325 million investment in an all-new, state-of-the-art mill in Grayling Township, Michigan.
What is Zegers’ message to ARAUCO N.A. customers? What can customers expect in coming years? Here are highlights from a recent conversation:
What’s the first thing U.S. and Canadian customers should know about ARAUCO N.A.’s investments and commitments?
ARAUCO N.A. is a North American company working for the North American market. Our team knows the market, they know the customers and work very hard to understand customer needs and objectives.
We offer products that we believe add superior value and performance. But only customers make the final determination. So we listen and learn from customers. My role is to work closely with Kelly Shotbolt and his team to make sure we apply what we learn in the best way possible. I help facilitate that ongoing commitment to our customers.
Such as with major plant upgrades and acquisitions?
Yes, we’re aggressively investing in a wide assortment of major infrastructure projects, including plant expansions, improvements and the construction of the most modern composite plant in the world [under construction in Michigan]. ARAUCO N.A. now claims the market’s largest, most up to date production network. No one is better equipped to handle U.S. and Canadian business than ARAUCO.
As a forest products company, it’s natural that our view is long term. After all, the growth cycle of a pine tree in an ARAUCO forest is about 22 years. Likewise, our North American commitment is a lasting one. We will continue to aggressively invest in people, process and production. Our customers in the United States and Canada can expect more products and better products with even higher levels of service and value.
Is the recent launch of the new thermally-fused laminate (TFL) line, PRISM, a good example?
Yes, it is. PRISM is a very important product for us. PRISM demonstrates we’re determined to offer a far wider range of products than ever before. Today the PRISM line includes 76 designs with many more exclusive designs on the way. This kind of expansion means additional TFL and paper treating capacity, as well as PRISM brand development. TFL is quite popular in Europe for a number of reasons. We believe TFL can be a very good option for the North American market. PRISM represents the kind of innovation and speed to market customers can look forward to from ARAUCO N.A.
Speaking of overseas, ARAUCO recently made news with your partnership with a large European and South African panel producer. What benefits can North American customers expect from international expansion?
The partnership allows us to learn best practices from mill operations across Spain, Portugal, Germany and South Africa. This is a positive development for North American customers. European and South African product development and service is quite sophisticated. Learning to apply those benchmarks to ten North American mills directly benefits customers with improved production, quality and value. We’re excited by all the ways we can apply what we learn to ARAUCO N.A. and the customers they serve.
FIBREX: 25 YEARS YOUNG AND GOING STRONG!
You would think after 25 years there would be nothing new under the sun when it comes to FIBREX® applications, but quite the opposite.
FIBREX is just getting started!
Just ask Michel Painchaud, Northern Region Sales Manager; Bruce Westbrook, FIBREX Product Manager; and Mike Frank, Regional Sales Manager. The FIBREX brand (high density fiberboard) isn’t slowing down at age 25. It’s packing extra muscle in its march across the North American marketplace, especially in the U.S.
There are many reasons for their FIBREX excitement. Here are just a few:
• Comprehensive product line. Today the FIBREX brand includes five grades: FIBREX (standard), FIBREX VESTA™ (ULEF certified), FIBREX FR (fire-rated door skin), FIBREX PG (print finish/wet coatings grade), and FIBREX Plus (high density). Across those grades are dozens of thicknesses, widths, finishes, and specialty options (such as pegboard and chalkboard). In short, FIBREX offers something for every distributor, OEM, and dealer. Speaking of which...
• Dealer breakthrough. “We’ve been traditionally strong in Canada with The Home Depot, Lowes, and others,” says Painchaud. “Right now we’re showing a lot of growth on the U.S. side. The mill has definitely taken a big part in adapting to this market with bar-coding and quick SKU configurations.” The vast U.S. do-it-yourself market is ripe for FIBREX. “It’s a big focus area for us,” Painchaud said.
• OEM adoption. More and more OEMs are lining up for FIBREX. Painchaud reports, “… major names are coming to us for supplies of FIBREX in a requested paint color or print for furniture backs and bottoms. OEMs are a dominant market for us.”
• New functionality. Take chalkboards. Restaurants love them for highlighting the night’s food and drink specials. What hospital or school room doesn’t have one or more? “Our product is painted with a UV low-gloss ink system,” says Westbrook. “It cleans exceptionally well. We’re offering sizes that may not be available anywhere else, such as four and five-foot widths and lengths up to 133 inches.” The early marketplace response is very encouraging, according to Westbrook and Frank.
• Rapid innovation. Who helped develop the new chalk board product? “Two of my customers,” reveals Frank. That level of listening to customer requests―and then swiftly acting on them―is a hallmark of our market approach.
• Then there’s etching. Painchaud is very excited by the new in-line etching process. “We started the first trials early winter. One customer checked it out and gave us the green light,” Painchaud explains. “The etching creates a woodgrain effect making products like sliding closet doors look more authentic and natural. With a UV topcoat, it performs extremely well.”
• Much more to come! Painchaud, Westbrook, and Frank agree the sky is the limit when it comes to FIBREX innovation and sales opportunity. In fact, Painchaud says his team is aiming to sell-out FIBREX mill production this year.
Happy 25th, FIBREX! The best is yet to come!