Qualified Remodeler Magazine

JUN 2019

Qualified Remodeler helps independent remodeling firms to survive, become more professional and more profitable by providing must-have business information, namely best business practices, new product information and timely design ideas.

Issue link: https://qualifiedremodeler.epubxp.com/i/1127998

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Page 8 of 68

THE ABRUPT, UNEXPECTED closure of Wood-Mode sent reverberations through- out the kitchen and bath segment of the re- modeling market, its ripple effect impacting dealers, designers, consumers, sales reps and others in the industry's supply chain. Last month's closure of the iconic, 77-year-old custom-cabinet manufactur- er dealt a blow to the company's extensive network of 700 dealers, many of whom have multiple projects currently in the manufac- turing pipeline. Cabinet orders in various stages of pro- duction were leƁ, at least temporarily, in a state of limbo. Suppliers coped with un- paid invoices. Consumers leƁ in the lurch wondered about the uncertain status of their projects. Wood-Mode's dealers in the U.S.—many of whom had long-term, exclu- sive relationships with the company—were leƁ pondering the fate of their own busi- nesses, with some contemplating potential closure and others searching for new cabinet vendors. Most lamented the fact that Wood- Mode, for decades an industry pioneer and long considered the gold standard for custom cabinetry in America, is out of business. "Wood-Mode has been a yardstick by which an industry has been measured," says Alan Zielinski, a past president of the National Kitchen and Bath Association and a long-time Wood-Mode dealer with Better Kitchens, Inc. in Niles, Illinois. "I'm attend- ing an industry event out in California, and when I got off the plane, my phone just lit up with the news." Zielinski, whose connection to the com- pany goes back more than 50 years to his father's ownership of Better Kitchens, notes his immediate focus is on six projects in pro- duction with Wood-Mode, including one or- der in transit from the factory. From there it is the question of what to do with several other completed orders that are ready to be submitted. According to Zielinski, other dealers he spoke with also had many orders in the pipe- line, expressing the sense that the closure was not about a lack of demand. "Looking at this from a 35,000-foot standpoint, may- be there is the opportunity for someone to come in and purchase it now, or perhaps give it a shot of financing to get it started back up again. However, if that does not oc- cur, then we have to evaluate what products we want to represent as quickly as possible Market Indicators Trade practices dispute continues U.S. trade officials are set to decide soon whether to proceed to the next stage of de- liberations into charges that Chinese trade practices in cabinet manufacturing and ex- porting are undermining the businesses of U.S. cabinet suppliers. A decision by the Commerce Department will determine whether to move ahead with a months-long decision-making process re- garding an unfair-trade petition filed by the American Kitchen Cabinet Alliance (AKCA), a coalition of cabinet manufacturers seeking so we can continue paying our bills and look to our survivability in the industry," says Zielinski, who visited Wood-Mode last fall for training. "Being part of Wood-Mode was being part of a family. We had family at the fac- tory. We had family in the production area. We had family in the offices." the imposition of antidumping and counter- vailing duties on imports of Chinese-made cabinets and vanities. The case—mirroring similar cases in oth- er kitchen/bath product sectors—has creat- ed a sharp divide between industry alliances that have lined up on either side of the issue. In a petition filed in March, the AKCA charged that, as a result of unfair-trade practices, imports of lower-cost, Chinese- made kitchen cabinets and vanities have risen sharply in recent years and currently comprise more than one-third of the $9.5 billion U.S. cabinet market. The imports, if leƁ unchecked, pose an existential threat to the U.S. cabinet trade, according to the AKCA, which charges that Chinese manu- facturers and exporters unfairly benefit from Market Overview Wood-Mode Closure, Trade Disputes Reverberate Across Kitchen and Bath Segment The Wood-Mode Lifestyle Design Center at Merchandise Mart in Chicago. Wood-Mode closed its doors in May, leaving hundreds of its remodeler and kitchen design dealers searching for new cabinet partnerships. IN BRIEF 8 June 2019 QualifiedRemodeler.com

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