It's 2008: The housing market is a mess, new home construction is half the level of four years ago and remodeling sales are down. It's a pretty crummy time to be in the building supply industry.
But not for EcoTimber.
The Richmond firm, a national leader in environmentally friendly wood flooring, expects to see its sales rise 20 percent this year - even while the overall wood flooring industry is likely to face a third consecutive year of declining sales.
EcoTimber has the good fortune to be serving the green building market, one of the few parts of the construction industry that continues to grow.
But that good fortune didn't come about easily or overnight. EcoTimber is an example of a business that was green before green was cool. The company labored for 16 years and went through three ownership changes before achieving success as a distributor of sustainable wood flooring.
Now it is finally benefiting from the tide of consumer interest in green products - but also facing competitive challenges because of that tide.
"EcoTimber has been a great pioneer for sustainably harvested wood flooring," said Melissa Mizell, an interior designer with the Gensler architectural firm who has used EcoTimber's flooring for years. "But I'm excited to see that there are others popping up. Because there's demand, there's new competition."
EcoTimber's roots go back to 1992, when several idealists in their 20s decided to open a business selling tropical wood from forests that were not being clear-cut or overlogged.
Their wood often came from obscure species of trees. And their potential buyers in the contracting world had no idea what "sustainable forest" meant.
"People ask for cabinets made out of things like cherry or mahogany," said Jason Grant, an EcoTimber co-founder who left the company in 2000 and today is a consultant on sustainable forest products. "No one asks to make something out of mersawa from New Guinea or chakte kok from Mexico. People couldn't pronounce these, much less order them."
Seal of approval
The groundwork for change was laid in 1993 with the creation of the Forest Stewardship Council, an independent nonprofit group that gives a seal of approval to commercial forests that meet strict environmental and social guidelines.
EcoTimber was a strong supporter of the council's high standards from the start, and was one of the first vendors of certified wood. But the early years were tough.
"It always felt like we were pushing water uphill," Grant said. "Every time we did a sale, we spent half an hour talking about why we were doing this and what it was all about. We had to work very hard to locate people who were interested in green building products."
Grant and his partners eventually sold EcoTimber to a lumber firm, which later sold it to two private-equity firms - one of which, Greenmont Capital Partners, focuses on the organic and green product sector.
Along the way, EcoTimber opted to halt direct sales to consumers and instead sell through dealers. It also made the key decision to get out of general lumber sales and specialize in flooring.
"Lumber is a commodity with no branding," said Lewis Buchner, a former cabinet-maker and longtime environmentalist who has been CEO of EcoTimber since 2003. "The problem is, you have five truckloads of FSC maple boards and go to the effort of getting (a buyer like) the Gap interested. Then someone else comes along and says, 'I can get you certified wood for 5 cents less.'
"Flooring, on the other hand, comes in a box with a label on it," Buchner said. "It's manufactured, with layers, a finish, a color name. It's harder for competitors to knock it off."
The other key factor behind EcoTimber's success is the growth of the green building movement, spearheaded by the nonprofit U.S. Green Building Council.
The council created a certification program for green buildings called Leadership in Energy & Environmental Design, which has become an increasingly coveted standard in the building world over the past five years.
Growing demand
Builders can get points toward a LEED rating by using wood with a Forest Stewardship Council seal - which fueled demand for EcoTimber's wares.
Under Buchner's leadership, and with the growing demand for FSC wood, EcoTimber's sales shot from $800,000 in 2003 to a projected $8 million in 2008.
Today, the company sells 24 varieties of hardwood and six kinds of bamboo flooring. All its hardwood is 100 percent FSC-certified, unlike some suppliers that use a conventional wood veneer over a certified backing. EcoTimber's flooring is also made without added urea formaldehyde, a carcinogen common in composite wood products.
Its 15,000-square-foot warehouse holds what Buchner says is the largest stock of certified wood in North America.
And the company gets rave reviews from retailers who specialize in green building products - both for quality and for environmental integrity.
"They are probably one of my best vendors for reliability, responsibility and accountability, and they are pushing the envelope on what is environmental and healthy-home," said Taja di Leonardi, owner of EcoHome Improvement in Berkeley.
"Their fanaticism for how wood is manufactured, distributed and harvested is first-class and truly green," said Joel Hirschberg, president of Green Building Supply, an online retailer based in Fairfield, Iowa.
EcoTimber's $8 million in annual sales represent just a fraction of the $6 billion wood flooring industry.
Buchner said he hopes to increase sales to $50 million within five years.
But the same green building trend that has fueled EcoTimber's growth is also attracting competitors.
Looking ahead
For instance, dozens of companies have started importing cheap bamboo flooring from China that they bill as green but that is not subject to any environmental or labor oversight.
And big flooring distributors are increasingly carrying FSC hardwood.
For instance, Golden State Flooring - a Bay Area firm that sells about $50 million to $60 million worth of flooring each year - has been credentialed to sell FSC wood for 11 years. But just this summer, it added a prominent environmental section to its Web site. And on Sept. 23, Golden State is sponsoring a free seminar for flooring contractors on FSC wood.
"A lot of how EcoTimber does depends on how quickly the big guys green up," said Grant, whose consulting clients include Golden State Flooring.
What happens to EcoTimber if certified wood moves from a niche product to the norm among mainstream flooring distributors?
"That would be one of the greatest environmental victories in the world," Buchner said.
And EcoTimber, he said, would stake out new, more ambitious environmental criteria for its products.
"We are not just an 'FSC and no formaldehyde' company - we are market leaders," Buchner said. "We'll be further down the road looking at how much energy goes into our products, how we transport them, do we produce locally, and what happens to your flooring at the end of its life."San Francisco Chronicle
