07/28/2022

Even more automation needed to cope with current challenges | Market report Northamerica

Through the end of the first quarter of 2022, the North American wood manufacturing market has continued to experience high demand, led by a substantial influx in consumer spending and a red-hot home construction market. Despite these positive indicators, the market has been met by global supply chain issues and a significant shortage of skilled labor. This turbulence has resulted in high demand for capital equipment as manufacturers look to increase efficiencies, ramp up production, and rely more heavily on automation.

The North American wood and furniture industry is facing a dynamic market. In many places, manufacturers are investing in automation solutions. In order for machines and software to be used efficiently, the optimization of entire processes in the value stream is often crucial.

Christian Vollmers (pictured right), President at Stiles Machinery, and Martin Kintscher (pictured left) Regional Manager America at Schuler Consulting, talk about current challenges facing the North American woodworking and furniture industry.

Published in möbelfertigung "Technologies & Strategies 2022"

Meeting current challenges

In January, Stiles Machinery, the North American leader in wood manufacturing solutions, distributed a survey to their customer base to understand the challenges they are facing in today’s market. When asked, “What is the biggest challenge your company is currently facing?” respondents answered, “Finding/Retaining Skilled Labor.” When asked what their second biggest challenge is, the overwhelming answer was “Supply Chain Issues (Product Availability).” Despite their customers working through these challenges, 60% of companies anticipated 2022 would be a great year, while 16% expected it would be their best year on record.

There are two primary reactions in response to these challenges throughout the industry: One is the big push for automation solutions, and the other is found in the onshoring trend. Many manufacturers try to deal with the shortage of skilled workers and supply chain issues by investing in a higher level of automation on their shop floor. Schuler Consulting’s North American team is seeing a strong development towards automation in machinery, software, and process optimization, especially in the kitchen manufacturing segment. In the past, the kitchen manufacturing industry has relied on the availability of inexpensive labor and manual processes. As a result, the segment had not embraced automated technology as much as other wood manufacturing segments.

Through investing in new technologies and finding strategies to cope with growing demands, the onshoring trend has turned out to be a challenge and a risk to manufacturers. Due to supply chain issues, companies have relocated their production within US borders. The first wave of the “onshoring trend” was initiated through the implementation of import tariffs under the Trump administration in 2019. As a result, formerly imported products, such as face frame cabinets, were now cheaper to produce domestically, causing a drastic change in market activities.

The onshoring trend continues

The second onshoring wave hit even harder: In 2021, the United States' leading trade partner for furniture imports was China, with a trade value of over 31 billion U.S. dollars. Vietnam was the second largest furniture supplier in the United States, with a little less than half the trade value of imports from China. (source: • Main furniture suppliers in the United States 2021 | Statista) In 2021, the blockade of the Suez Canal and the coronavirus greatly affected global trade and transport. High shipping costs combined with international trade restrictions caused by the COVID-19 pandemic have made it extremely difficult for companies to import and export products.

The woodworking industry is facing challenges with supply chain issues and a lack of skilled labor. At the same time, production demands remain high. New automated machinery has since emerged to combat these obstacles. As more and more businesses evolve, the demand for automated solutions throughout the industry continues to rise, and the capabilities of these solutions continue to grow.

One step ahead: Helping the industry overcome today’s challenges

To optimize efficiency in today’s market, companies must evolve their manufacturing processes and look to integrate automated solutions. The goal of the Schuler Consulting team is to help clients achieve sustainable success. To do this, Schuler Consulting creates customized solutions that determine the ideal production flow for each manufacturer’s unique business needs. The consultation process begins with a detailed on-site analysis with the customer, followed by creating an integration plan for automated machinery. The team at Schuler Consulting evaluates the current business processes and utilizes that information to identify the path to reach the customer’s goals.

Finding and retaining skilled labor is a massive obstacle in the woodworking industry. Stiles Machinery has made significant efforts to build solutions to help manufacturers overcome our industry's challenges. As it relates to finding/retaining skilled labor, Stiles offers the only accredited training in the industry, Stiles University. The program offers a list of 28 unique training offerings ranging from customized on-site training to regularly scheduled public classes and the Stiles University Online platform. The depth of these offerings allows Stiles to tailor the training needs and timing to each manufacturer individually.

To ensure North American wood manufacturers can meet their increasing demand, Stiles has continued to grow their team of field service technicians with the goal of hiring 30 more techs by the end of 2022. This goal would put Stiles at 230 field service technicians across North America. Stiles has also expanded its parts inventory by 15% while maintaining a first pass fill rate of 94.5%. This means Stiles can immediately fill 94.5% of the incoming parts orders they receive with the inventory they have on hand.

Conclusion

In any market, every company faces its unique challenges. It is crucial to adjust and to be open to change. It is important to have a roadmap for future company development – from a strategic point of view and a social/human perspective. The industry’s demand for sustainable, steady, and unique solutions grows daily. At Stiles Machinery and Schuler Consulting, this means developing solutions for the customer that answer the questions of “What’s now, What’s new, and What’s next.” Both companies will be presenting these solutions at the upcoming International Woodworking Fair in Atlanta, Georgia, August 23-26, 2022.

About Stiles Machinery Inc.
For more than 50 years, Stiles Machinery has been North America’s industry leader in wood manufacturing solutions. As North America’s largest supplier of quality machinery, Stiles provides a total production solutions approach by offering equipment integration, project management, financial services, education, service, and parts.

About Schuler Consulting

Since 1956, SCHULER Consulting has implemented consultancy projects with companies of the international timber and furniture industry. The company’s objective is to help their clients achieve sustainable success. With more than 30 employees in 8 locations worldwide, the team of woodworking engineers develops customized solutions for companies of every size. The team draws on more than 65 years of experience.

Authors: Christian Vollmers (President, Stiles Machinery) and Martin Kintscher (Regional Manager America, Schuler Consulting)