In Part One of Why Mill-Direct Buying Matters, we discussed the typical lumber distribution chain. It looks something like this:
- Forest to Logger
- Logger to Mill
- Mill to Remanufacturing Facility – (Depending on the product and this is sometimes combined and part of the mill)
- Remanufacturing or Mill to Distributor
- Distributor to Retailer
We also defined some important keywords to make sure we are all on the same page in understanding this process. Go back if you don’t remember the differences between Forest, Logger, Mill, Remanufacturing Facility, Distributor and Retailer. In this blog, we will discuss in depth the benefits of working with a Mill-Direct retailer, like Rocky Mountain Forest Products.
Did you know that around 65% of our yard stock comes directly from the mill, 15% comes from a remanufacturing facility and around 20% comes from a wholesaler or distributor? Compare that to a typical Big Box store like Home Depot or Lowe’s which purchases on average 90% of their yard stock from a wholesaler or distributor. There are definitely exceptions to this statistic, but in general they are not purchasing their yard stock mill direct. So what types of materials does RMFP purchase mill direct, from a remanufacturing facility or from a distributor?
Mill Direct: Most of our fencing material, cedar decking, all stocked siding patterns such as channel, bevel, tongue and groove, shiplap, all interior and exterior trim, and rough sawn doug fir timbers are all purchased directly from the mill.
Remanufacturing Facility: All of our exotic hardwood decking, redwood decking, log lap siding and any custom siding patterns comes from a remanufacturing facility.
Wholesaler/Distributor: All of our composite decking, hardware, landscape timbers and other brand specific items come from a wholesaler or distributor.
Why Should you Care About Buying Mill Direct?
Mill-Direct Keeps the Cost Low.
By cutting out the middleman, we are able to help keep the cost low without added costs typically associated with every level of the supply chain. We are able to increase our margins and sell the customer a price friendly product, because we’ve taken it back to basics with the products we supply. Going straight to the source helps us in a variety of different ways. With our mill-direct buying relationships, we are able to sell our products at 30% less than Home Depot or Lowe’s because we buy directly from the mill with no markups.
Better Quality Control Without the Games
We are able to offer better quality control with our mill direct products because sometimes wholesalers or distributors will play grading games. For us however, when we buy from mill, we buy the true exact grade as it should be. We know exactly what we are getting, no questions asked. If we pick it up the same material locally from a wholesaler or distributor, some companies will sell a lower grade claiming it’s a higher grade. This is deceiving to everyone involved, because it’s not the same material.
For example, we have purchased a true reversible cedar deck board directly from the mill and paid less money than if we tried to pick it up locally from a wholesaler. The material from the wholesaler will have one side be appearance grade with the back side only having 80-95% usable material because of the defects on back. At the mill level, this product is graded as a one faced product, but locally, the wholesaler can only get their hands on the lower grade and will sell it claiming its a higher grade.
Another example is that a lot of box stores carry a #3 and better picket, which is a rustic grade. They will then sell it at standard price, because the supply chain messes it up with all of the additional markups. So many people have touched it throughout the supply chain that they have to sell it as standard price, even though its not standard grade.
Our relationships allow us transparency and honesty at the mill level and we know what the material will look like when it shows up. A lot of lumberyards rely on the mercy of their wholesalers to ensure quality all the way up to the mill level. They sometimes don’t even know what the material looks like until it’s delivered to a job site, which can be stressful for everyone involved.
Our goal at RMFP is to tell consumers exactly what they are getting, with no grading games.
If it’s an off grade or low grade material, we will still sell it to you and you can pay a lower price- but we will tell you exactly what to expect with that grade so there are no surprises.
We are honored to explain the lumber distribution chain and why buying mill direct matters. We will continue to invest in our mill direct relationships to ensure that we can continue to bring our customers the best quality materials at the absolute best prices possible!
