Author: caflynn

Shipments, Pricing, Conceptual Selling

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Three Messages:

1) WindsorONE Shipment Status: Jan Hull (Executive Account Manager) will be contacting your organization w/ your current WindsorONE shipment status given the previously reported 6-day delay in container shipments.

2) Cost Structure Impact: Looking to have this completed by Monday.  Please note, the additional time we’re taking to calculate the financial impact to procure raw material and to manufacture WindsorONE will help us achieve, as best possible, consistency in pricing over time, given unstable markets.

3) Conceptual Selling:  Speaking of pricing… drop me an e-mail (craig@WindsorONE.com), and I’ll send you a couple copies of this excellent book that will help your sales organization get away from competing on price, and better help your sales organization compete on Unique Strengths and Value. (W1 Dealers only)

Six salespeople from three W1 Dealers recently went through a 2-day Miller Heiman Conceptual Selling Workshop; it was so powerful that all are now working towards implementing the methodology throughout their respective sales organization.

If you’d like to hear a Dealers first-hand Conceptual Selling experience, don’t hesitate to drop me a line, I’m more than happy to make an introduction.

Until Monday…

Craig

Workaround Success! (w/ 6-day delay)

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The uncertainty of the Bio Bio bridge does have mills in the region confused, but we’re lucky to have already found a workaround.  However, the new shipments won’t depart for 5 or 6 days, which will yield an additional sparse week of WindsorONE production.

Weeks of 3/29, 4/5 and now 4/12 are going to be difficult; we’ll contact you directly on how this will be impact your WindsorONE shipments.

Supply Disruption?

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Marcelo (ForAction General Manager) sent us the following message yesterday afternoon:

“…we have all containers on Sitrans ready to send to Puerto Coronel but the government stopped the truck traffic on the bridge Bio Bio for the risk of falling (this is the only way to reach port.) . We hope that this restriction be lifted as soon as possible. We are looking for alternatives to ship all our containers…”

Approximately half of our containers were going to ship through Coronel; pending shipment/vessel alternatives, we’ll report back as soon as possible on consequences to WindsorONE CA/VA shipments.

I did make note Wednesday that I would report back on possible impacts to our cost structure come this Monday; however, efforts now are focused on finding alternative routes to ship all containers. 

At this point though, it is clear that the cost to procure raw material and to manufacture WindsorONE will increase; we’ll need a few more days to better understand by how much, and by what date a price increase will take effect.  Please note: we will only change the price of our products by the actual and realized incremental increases to our cost structure.

As always, please do not hesitate to contact me directly should you have any questions; my contact information can be found at the bottom of this post.

In Solidarity,

Craig

Arauco Producing…

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Good news for the industry, Arauco has resumed operations at many facilities.  The below message is from Mark Young of Arauco (Atlanta Offices), March 17th:

“Beginning this week, Arauco has resumed the operation of the following industrial facilities:

Sawmills: Of the seven sawmills that will operate in Chile, five are operating – Valdivia, El Cruce, Vinales, Nueva Aldea and Cholguán.

Remanufacturing Plants: Of the five remanufacturing plants, four are operating – Vinales, Valdivia and 2 in Cholguán.

Panels Plants: Of the four, two have initiated their operations:  Trupán has begun a line of MDF, and Nueva Aldea has started up two lines of plywood.

The Arauco energy plant in Nueva Aldea has initiated its operations, and is producing electrical power for the grid  – Sistema Interconectado Central (SIC).   The Arauco Valdivia energy plant is operating providing electrical power for the grid as well

Pulp: The five pulp plants continue the process of accessing damages and are working to standardize their operations for start up.

Ports:  Activity has begun in the ports. San Vicente is loading containers, Lirquen has loaded a Break Bulk Vessel for Mexico and the port of Coronel is preparing a container vessel to be loaded beginning on March 20th.

Arauco continues to support the numerous relief efforts to aid its employees and their families, as well as the affected communities.

In a joint effort with the communities, machinery was made available to clear the streets and highways and to provide basic services. Additionally,  land was donated for the temporary installation of one thousand emergency homes.

As the surrounding communities, our employees and their families work to resume their daily lives, the company will now focus on the remaining industrial sites which will mainly consist of debris removal and cleaning and repairing the affected production facilities to get them back on their feet.

Please visit  http://www.arauco.cl for additional updates.”

Insights into Infrastructure, Pricing

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We reported on 3/10 that infrastructure and roads to ports from our Foraction plant had been damaged; and that luckily we had found a work-around, albeit 4-times as long, which would increase inland freight rates and cost of fiber.  The good news today is that our normal routes have been repaired (or are being repaired), and WindsorONE products will no longer incur the additional freight cost.

There are still many factors, however, that could increase the cost of our products; we’re gathering as much information as possible now, to see exactly if, how or when our cost structure might be impacted.  We should be able to provide more Insights into pricing come Monday of next week.

SitRep on Our Supply

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In Short:

We’re going to be okay, but will need to work closely with our customers for the month of April to manage our ability to produce and ship WindsorONE against customers’ needs, given a short gap in raw material flow.

In Detail:

We have containers from ForAction starting to ship to our USA WindsorONE plants beginning March 22nd.  This will be just over three weeks with zero shipments from Chile to the states, and with the 2-3 week container travel time, our ability to manufacture and ship will tighten at the USA plants for a few weeks.

We expect about 50% of normal WindsorONE shipments come the week of 3/29, and zero WindsorONE shipments week of 4/5; however, likely arriving shortly thereafter will be raw material from ForAction, so we should be back at close to normal come the week of 4/12.  I type “close to normal” b/c without a heavy working inventory, or as we call it “running hand to mouth,” efficiencies will run lower as we’re not able to produce at maximum capacity.  In addition, b/c we’ll be short on shipments week of 3/29 and 4/5, we will be playing catch-up for the month of April.

We will be proactively managing each of your accounts and orders, and when we expect delay caused by the above, you’ll hear from us directly.

It is also possible that some customers will see an increase in freight costs; if, for example, we’re unable to meet your requirements from the Surry, VA plant, then at times it might be possible to ship from the Willits, CA plant.  Of course we would only do so at your discretion.

In advance, thank you for your patience and proactively working to manage your inventories with Jan! 

In Solidarity,

Craig

SitRep on Ports

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Team in Chile just reported the following to us…

“The actual situation of the Ports is the following:

– San Vicente, working to 50 %

– Lirquen, working to 90 %

– Coronel, working to 90 %”

I’ll be able to report more tomorrow on our supply status and possible holes (waiting on a few more pieces of information so I can provide best possible insights to Customers).

–Craig

Boom! We’re up and running…

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Marcelo and his team fired up ForAction today; we’re up and running, and again producing WindsorONE block for our USA plants.  We even had 100% of the employees at the plant for work.

Yes, we’re still concerned about vessel space and that last “brick wall” to break through, but certainly the amazing dedication and hard work of the ForAction team getting the plant back online deserves some serious recognition!

Please help us give a congrats and a thank you to Marcelo and the ForAction team for their tireless dedication to Windsor Mill and our Customers; and for those of you that comment in the section below, we’ll continue the tribute by sending you a slug of the new WindsorONE “King of Boards” t-shirts to hand out to your favorite WindsorONE Builders… [WindsorONE stocking dealers only]

Will report back again Monday with updates sent over the weekend…

In Solidarity,

Craig

Chile Can’t Catch a Break

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7.2 “aftershock” hit Chile this morning.  As a reference, the Haiti quake was a 7.0.

ForAction mill is fine, we made it through okay.  No news yet if this there’s any impact on the road and/or port situations; Marcelo was in Concepcion at the time of the quake, and is currently heading South to investigate, he’ll report back this evening.