Weston—Around The Corner, Around The World By Doug Knowles
Exterior of Weston Premium Woods’ new 105,000-square-foot distribution facility in Brampton, Ont.
The First 25 Years
Mississauga, Ont.—Weston was incorporated in 1953, and was primarily managed by Frank Ekstein for its first quarter century. The business was typical for a local lumberyard, doing a mixture of building products for the public, local contractors and nearby manufacturing industries. By 1978, the company was located on 6 acres of land on Torbram Road in Mississauga, Ont., and had covered warehouse space of approximately 20,000 square feet and a total of 12 people on staff. The annual sales were at $2 million.
The Second 25 Years
The next quarter century was one of constant change and growth for Weston. As they completed university, Frank’s sons, Rick, followed a few years later by Peter, entered the company. Rick and Peter had both been active in the business on weekends and during school holidays since their early teens, and had done every job from sweeping the floors, maintaining the machinery, driving forklifts and trucks, selling to the public and filling in wherever necessary. This provided a solid foundation on which to grow the business.
Indoor climate-controlled loading area at the company’s Brampton location.
The years saw new product lines incorporated into the business, as well as geographic areas, and a constant investment into infrastructure to support the growing sales. Profits were constantly reinvested into the business.
While new ideas and initiatives were encouraged, they were always measured against the “what is the worst thing that can happen” yardstick.
By the end of this period, in 2003, the company had grown into 75,000 square feet of buildings on 15 acres on Torbram Road; 115,000 square feet of leased warehouse space two miles away; and a 20-acre remanufacturing facility with 100,000 square feet of warehouse space located on the outskirts of Montreal. Sales were around $160 million, and market penetration included almost all provinces and states in North America, as well as more than 40 countries worldwide. There were 200 associates on the team, and assets included kilns and machinery, for adding value to the product line, and a fleet of 13 tractors and numerous trailers. The business had grown so dramatically in scope over the years that different divisions were created based on unique products, and the customers who used those products.
Machinery for mortising and dadoing window and door components at Weston Wood Solutions, located in Malton, Ont.
“You look back over the success of the past 50 years, and it has all been due to the quality of the people who we’ve attracted to this company,” Rick said. “Our entire success is due to the people we have, and our success over the next 25 years will be due to them as well.”
The Third 25 Years
As the company celebrated its 50th year in business, Weston was faced with a year in which lumber prices were at historical lows, the Canadian dollar was rising—thereby cutting profits on all exports—and the lumber industry was suffering from a punishing 27 percent duty on shipments of Softwood lumber into the United States. All of these challenges encouraged Rick and Peter to take a step back from the daily pace of the business and undertake a high-level review of all operations and systems, as well as the desires and dreams of both themselves and their senior managers.
Kiln-dried lumber ready for export.
The outcome of this review was the understanding that in order to continue to grow, be competitive, and provide excellent service to all of our customers for the next 25 years, a new business model was necessary. Essentially the result was to turn one large, highly diverse company into a series of smaller ones, divided up by product lines.
Each business unit would be located on it’s own property, consolidating all of it’s inventory into one location, with it’s own value-added equipment, fleet, operations and administrative support teams. This would allow each company to be easier to manage, more focused, and therefore better able to support it’s customer base.
Each unit’s management team would be encouraged to develop it’s own business plans, be entrepreneurial, and grow significantly.
Finally, each group would have it’s own name and identity, but part of it’s name would include “Weston” in order to continue to leverage the value, trust, and excellent reputation associated with it.
Weston Forest Products is situated on 16 acres in Mississauga, Ont.
As of today, there are seven distinct business units.
Weston Forest Products Inc.
The core business of this company caters to customers who either manufacture crates and pallets, or to those who manufacture a product that needs to be crated for shipment, such as manufacturers of glass, steel, transformers, etc. Generally, lines of distribution are direct to the end user, but sales are also made to other wholesalers and distributors as well. Sales are primarily in Eastern Canada, and the Northeast and Midwest American states. Most products are remanufactured at this company’s own facilities in order to add maximum value to the company and maximum value to the customers.
Weston Premium Woods Inc.
This group sells the highest grades of North American and imported hardwood lumber, Pine and panel products to manufacturers throughout North America. Within Canada, sales are primarily to the end users, but in the United States, they are both direct and through distributors who resell the products to the same types of end users. Grading and planing facilities are onsite to provide prompt service and custom grades.
Weston Forest Group of companies’ new logo and tagline.
Weston Global Woods
This group distributes all of its products offshore to a mix of more than 40 countries. It manufactures North American hardwood, and distributes Canadian Western Red Cedar, Hemlock, Douglas Fir, Canadian SPF and Russian beech and whitewoods.
Weston Wood Solutions Inc.
This group manufactures and distributes engineered wood components to the window and door manufacturing industry in Canada and the United States, with some overseas sales. It is the exclusive sales representative of “Asian Prime Millwork and Building Products,” and distributes primed wood sidings and fascia boards to the retail trade in the United States.
Weston Outdoor Woods
This group produces and distributes components and specialty products in Western Red Cedar, Chinese Cedar and pressure treated lumber.
Weston Global Partners
This group was set up to develop partnerships with producers in areas of the world that are emerging as potential suppliers to the North American marketplace. The company currently represents eight sawmills in Russia, and have partnered with the Asian Prime Group and their 11 production facilities in China. The firm has an office in New Delhi, India, and in Xiamen, China, and is exploring options in other parts of the globe. This division brings opportunities, finance, logistics and quality
The grading chain at Neos Forest Inc., which is on 21 acres in Mascouche, Que.
control to its partners, and distributes their products by means of the global group of companies.
Neos Forest Inc.
Neos is Weston’s Eastern White Pine production facility, located outside of Montreal. It is here that green Pine and Western Red Cedar is dried and custom graded for furniture and millwork customers, both domestically and overseas. As well, the production facilities for Weston Global Woods are located on this site.
The initial thought process that went into establishing these diverse groups and their individual teams was to ensure the following:
• That each group have purchasing synergies, thereby allowing Weston to approach primary manufacturers and purchase the full breadth of their product lines, thus enhancing Weston’s value as a customer.
• That Weston be continuously searching the globe for new sources of supply, and that this knowledge is shared with all divisions.
• That Weston can be a “one-stop shopping” source for its customers, which enhances value and retaining loyalty.
• That due to its diverse product base and access to suppliers and customers worldwide, it would become known as one of the most knowledgeable forest products companies in the business, attracting not only customers and suppliers, but staff
Cut-to-size lumber exiting the L & M Verticut Bunk saw.
Weston Forest Corp. and all of its related companies (and those yet to be created), has a half century of experience and proven success, and is planning to leverage this knowledge into a solid foundation for the future. Rather than be complacent, the principals are taking steps to not only preserve their current capital base, but to create a model to realize the aspirations of both themselves, their senior managers and their staff. The goals are to increase profits and sales from $180 million in 2005 to $200 million in 2006, and to have fun and be the best in every area that they do business.
Each business unit is already being diversified within its core business area to expand its product lines and geographic market areas. This was a core “best practice” of the first 50 years, and this will continue to play a large part in future risk management strategies.
In 1998, Weston was named “One of Canada’s 50 Best Managed Private Companies.” The firm is a member of the North American Wholesale Lumber Assoc., the National Hardwood Lumber Assoc., the Canadian Lumbermen’s Assoc., the Canadian Lumber Remanufacturing Assoc. and the Assoc. of Lumber Remanufacturers of Ontario. Rick is a director of the NHLA and is a founder and director of the Canadian Lumber Remanufacturing Assoc. and the Assoc. of Lumber Remanufacturers of Ontario.