Mike Girard is the third generation of his family adding value to Canadian forestry products. But unlike his predecessors who sold their products locally, Girard’s specialist operation, Swiftwood Forest Products, remanufactures coastal lumber destined for export to the U.S., Asia and Europe.
Swiftwood operates in the secondary manufacturing sector of B.C.’s forestry industry, which is responsible for 4.6 per cent of the province’s forest products exports, according to the BC Forest Industry Economic Impact Study (2015) conducted by consulting firm MNP.
Girard says Swiftwood’s place in the value chain is secured by its focus on wood components, custom moulding and millwork, while leaving products in the commodity market to the mass manufacturers. Much of the custom millwork is remanufactured from Western Red Cedar, with lesser amounts coming from other Pacific Coast softwood like Douglas fir, hemlock, spruce and pine from B.C.’s interior forests.
Girard’s grandfather, an immigrant who first established a grocery business before seeing an opportunity in the forestry industry, built a thriving custom cutting and cedar shakes and shingles business in B.C. After he retired, Girard’s father and uncles started a new business focusing on furniture and millwork. When they retired and sold the business in 2002, Girard worked in the industry before buying Port Coquitlam-based Swiftwood in 2004.
In his 40 years in the industry, Girard has seen the best of times and the worst of times. Following the 2008 financial crash the business struggled to survive.
“I spent half my time just looking for work and we took lots of small local jobs just to keep the machines running,” recalls Girard.
But as the U.S. residential housing market has recovered, so too has Swiftwood. “The current demand from the U.S. means we are running at capacity, looking for extra space and considering leasing a new moulding machine,” says Girard, who estimates that 70 per cent of the moulding and millwork produced at Swiftwood is destined for the U.S.
The Canadian dollar costs of the value-add to the wood product destined for export also makes remanufacturing at the Port Coquitlam facility an attractive option.
As a custom remanufacturer, Girard does not own the wood fibre. He receives lumber cut from logs at local mills and completes the value-add according to client instructions. However, he sees big differences in demand between the pre-2008 and the current market.
“The customers only buy as much as they need for the work on their books. It’s very much just-in-time inventory. They are not prepared to invest in any inventory. Prior to 2008 wholesalers would take an inventory position in anticipation of demand. That doesn’t happen anymore,” he adds.
“Wholesalers in the north-east states like New York and New Hampshire used to take inventory positions anticipating high demand,” he explains. “Now the demand coincides with the warmer months when there is lots of residential building.” This seasonality makes the supply chain more challenging because manufacturing capacity does not always coincide with market demand.
As a link in the supply chain maintaining a just-in-time inventory, Swiftwood must ensure not only that the goods it manufactures arrive on schedule, but also that it obtains the maximum yield from the fibre without compromising the custom high-value finishing.
Just as customers are managing their inventory and cash flow, Girard needs to watch his accounts receivables. Payment of those accounts relies on accurate reporting and Girard uses a made-in-B.C. software solution, Lumber Inventory Systems Automation (LISA) software, to track incoming wood fibre, completed orders and shipping. “Our customers depend on accurate reporting for costs like trim loss and our ability to get the product packed and available for container loading. Accurate paperwork is essential for products sent to the port for shipping, according to specific instructions,” says Girard.
Decades in the business has not dulled Girard’s pride in his work. “When you are in the custom business, you are always striving to make your products the best that they can be; to make them better than anyone else can make them. There’s nothing I like better than walking into a place where our work has been used and seeing how good it looks. It never gets old.”