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Hardwood Record — Veneer & Panel Section 



June 25, 1921 



August Sales May Enliven Grand Rapids 



Dealers in hardwood lumber in Grand Rapids are spending most 

 of this summer fishing and the fishing is little better than the 

 lumber market so as a general rule these fellows are all out of 

 luck. The fact is so far as it pertains to lumber that practically no 

 hardwood lumber is being shipped into the Grand Rapids fur- 

 niture district at all. The dealers* yards are full and have been 

 for a considerable time and little is going out of the yards. The 

 furniture factories' yards are full of lumber and their warehouses 

 are full of furniture. They need no more lumber so why not go 

 fishing — if only the fish would bite. 



The situation is well summed up in the following statement 

 made by one of the largest dealers in hardwoods in Grand Rapids, 

 a man who makes a particular specialty of furnishing the furniture 

 factories with hardwoods, particularly of native growth. 



"I have never known the hardwood situation to be quite as flat 

 as it is right at this time. As a result I spend most of my time 

 on the trout streams where the fish don't bite much better than 

 the furniture manufacturers do. The furniture men made a mis- 

 take in January and I told them in advance they were going to. 

 I urged them to put down their prices. They figured they could 

 keep them up by bringing out new patterns. They tried it and 

 they failed. The result is, that except for about four manufacturers 

 who did do as 1 suggested, their warehouses are now filled with 

 furniture which remains unsold. Therefore I can't sell any lumber. 



"This situation is extremely bad. The lumber market is entirely 

 demoralized. The prices on all lumber have been cut in the last 

 nine months all the way from 60 to 75 per cent and on some 

 grades and some kinds I am offering prices at below the pre-war 

 price. Still I can't sell it because the furniture manufacturers 

 can't use it. 



"But not only are lumber prices demoralized but furniture 

 prices are in even "worse condition. It is an admitted fact that 

 many furniture manufacturers are selling their products at below 

 cost and unless this coming market serves to stabilize prices some- 

 body is going to find himself in the bankruptcy courts before long. 

 They can't go on making furniture at a loss forever. However, 

 ! look for a hardening of the market once it is under way but it 

 will be on a basis of rock bottom price which the buyer will either 

 have to pay or go without and the factories will be forced to close 

 down. 



"The hardwood lumber situation is dead all over. Most of the 

 southern mills are not running and outside that lumber which 

 goes into furniture those of us deal in hardwoods alone are having 

 our troubles because of the disinclination on the part of the general 

 dealer to sell building material unless he also sells the interior 

 trim. The hardwood man is certainly out of luck these days. 



So far as the furniture situation is concerned this lumber dealer 

 has the dope just right. The demoralization in furniture prices 

 which followed upon the heels of the January market is general 

 everywhere in the industry. The National Alliance of Case Goods 

 Manufacturers is making an energetic attempt to put prices back 

 upon an even keel. It is admitted everywhere that a lot of goods 

 has been and still is being sold at prices below the cost of pro- 

 duction. All the members of this association have been urged to 

 make inventory as of June 1 and to fix the prices for the July 

 market on the basis of that inventory. A large number of the 

 manufacturers have replied that they are agreeable to this and will 

 do so. They add that having placed a fair margin of profit on their 

 merchandise based upon this inventory, they will either get that 

 price for their goods or quit manufacturing until the dealers are 

 ready to buy. If they follow this plan to the letter and stand pat 

 when the bears begin to work in the market the effect will be to 

 stabilize prices and put the furniture industry back again out of 

 its present chaotic condition and make it a paying industry 

 once more. 



Probably the chief reason for the present demoralization is due 



to rumors which float through the furniture industry in never end- 

 ing stream. Most of them — officers of the National Alliance figure 

 90 per cent of them — have no foundation in fact. They arise 

 generally from a class of dealers who are looking for something 

 cheap. These refuse one salesman's merchandise telling him that 

 somebody else is doing so and so. The salesman communicates w^ith 

 his house and the manufacturer in many instances feels it is up 

 to him to meet the competition and cuts the price accordingly. 

 A checking up of these rumors prove most of them to be without 

 foundation but perhaps the damage has been done before the 

 checking up. 



The rumor business usually centers about the several markets. 

 The Jamestown manufacturer is told what the Grand Rapids 

 manufacturer is doing and the Grand Rapids manufacturer is told 

 a fairy story about what they are doing in Rock ford or Chicago 

 and so it goes. The July market in Grand Rapids and Chicago 

 will serve to set at rest the great majority of these rumors for 

 the manufacturers will all be together and the buyers will have the 

 opportunity to learn first hand just what prices are. If no furniture 

 at all is bought the market will have served a most useful purpose 

 by thus setting at rest the rumors and all will tend tow^ard stabiliz- 

 ing prices and so making the industry prosperous once more. 

 August Is a Star of Hope 



Of course all eyes are now turned toward the .August sales. If 

 the dealers feel that August sales will bring success they will buy 

 heavily at the market. If they are still skeptical, the buying will 

 more likely be light. The Grand Rapids market which is always 

 the barometer both as to conditions and prices w^ill set the prices 

 which other manufacturers will follow. If during the four w^eeks 

 of this market sufficient confidence is generated in the dealers' 

 dynamos all the industry will profit by the sales which will result. 



Financial dopes ters are quite of the opinion that business will 

 begin to pick up about August I. If their guesses are at all correct 

 the August sales by dealers will be successful and factories w^ill 

 quickly feel it in increased orders. Business in the factories during 

 the last few months has run about as follows the country over: 

 January and February very bad indeed. March and April about 

 60 per cent of normal. May about an even break and the first half 

 of June about the same. Now comes the market opening June 27 

 and that will largely determine what is to happen in the furniture 

 industry for the balance of the year. 



Evansville Trade Is Quiet 



Trade is rather quiet with the furniture manufacturers at Evans- 

 ville, Ind., at the present time, but they are of the opinion that 

 the market that is to be given late in August will have the effect 

 of stimulating the trade to some extent. A month or so ago there 

 was a marked improvement in the furniture trade at Evansville 

 and the manufacturers reported at that time that conditions in 

 the east were improving rapidly and that it was but a question of 

 time until the change for the better would be felt in the middle 

 west, south and southwest. But during the past month there has 

 been a sort of lull in the trade and conditions in the south are 

 still bad. due to the fact that cotton is not moving at all and there 

 can be no permanent prosperity in that section until cotton moves, 

 it is pointed out. While the manufacturers report that they are 

 getting some orders, trade has not picked up as briskly as they 

 had hoped to see it. The plants are being operated on an average 

 of forty-five hours a week and in some instances the factories 

 are running as high as fifty hours a ^veek. The factories a month 

 ago were in the market for considerable gum and quartered white 

 oak and the demand was quite brisk for a while, but recently the 

 factories have quit buying lumber almost altogether. The out- 

 look is not as bright as it was a month ago, although the manu- 

 facturers believe that things will pick up again. 



