APP Timber established in 1998 and headquartered in Kuala Lumpur, Malaysia has maintained its sales expansion of wood and veneer imports based on the principle that Asia is, and will continue to be, short of material and increasingly needs to import. Now the company has exciting new plans for its operations in Southeast Asia.
Now with 70 employees, mainly based all over Asia in 7 locations, the company’s turnover has grown to $30 million in recent years and is aiming for $50 million by 2020. That needs vision and strength, especially in the current economic climate. The vision is that of Managing Director, Michael Hermens and the strength is that of a well-trained and increasingly knowable team now led by Director of Sales & Marketing, Malte Herrmann. “Selling imported wood-based products through know-how is our key message,” says Michael Hermens, who is now ready to take the company to a new level.
In the past APP Timber’s strategy has been to employ sales people who came out of production. The key was to develop a strong relationship with suppliers and to fully understand their supply capabilities. Today the company is concentrating on offering more material from stocks on the ground in Malaysia, Thailand and Indonesia. 50% of the company’s sales are in sawn lumber and 20% of its total sales are in American hardwood species, particularly White Oak, Walnut and Tulipwood. Hermens believes that suppliers are priority number one on their agenda and even suggests they are their number one ‘customers’. “We can only find buyers if we have good suppliers,” he says “whereas with good suppliers we can always find buyers.” Meanwhile the company is working hard to upgrade know-how of ‘sales colleagues’; which means providing existing employees with the extra tools they need before recruiting new ones. The company has a long-established internal on-line training programme for all sales staff in which they all participate. “Our sales teams have good knowledge not only about raw materials but also in manufacturing and we aim to be known as Asia’s most innovative company providing imported timber solutions offering cost effective solutions from sustainable resources” is the objective stated to new employees in APP Timber’s induction.
All this has led to the current plans for Asia’s first commercial Wood Distribution & Training Centre (WDTC) being established in Indonesia, for which the first of three phases has already started. The company has purchased a one hectare (2.5 acre) site in Java where the first building is under construction for completion by the end of this year. It will house a distribution centre of lumber, veneer and panels. A veneer showcase will be an important feature for veneer buyers inviting them to inspect a wide various of veneer species and experience new techniques for veneer applications. The WDTC will also provide offices for rental by distributors of wood related products, such as adhesives, sanding papers and equipment. “This has to be a knowledge centre for the industry in Indonesia,” Hermens insists. The second phase, to be completed by mid-2017 will be a training facility and high-tech information centre – free to associations which commit to training. This is a good project to a country much in need of professional help, and one that the world should take more account of –given its population, resources and potential. The third phase for construction in 2018 is now in the planning stage and the whole project is being considered for replication in Vietnam.
Today a ‘foreign partner’ member of AHEC, APP Timber is also an active with NHLA. Michael Hermens attends many of their events and Malte Herrmann joined the markets panel at AHEC 2016 Convention in Chongqing. China is a market of increasing importance to APP Timber, which is now also established in Indonesia, Malaysia, Thailand, Vietnam, India and Bangladesh. Markets are also being developed in Sri Lanka, Mauritius and the Maldives. This enables the company to participate in return trade by offering Asian-made products to buyers globally, although currently 50% of such sales are to the USA. This is a growing segment for the company which employs 5 staff focusing solely on exports. The company is FSC and PEFC Chain of Custody certified.
Editor please include: Based on an article first published in Wood Purchasing News, USA