advantages of buying cut to size parts are widely recognized.
A component mill, situated close to the forest, can obtain a better
utilization of the log/lumber than can any single customer. This
is because the mill can produce parts for several customers at
one time, combining the varying sizes and quality requirements
to obtain the optimal yield from the raw material. In addition,
because a component mill's primary function is to process timber,
they can afford to buy the latest, high-technology machinery,
including laser-guided saws, computer-controlled optimizers and
automated handling equipment. With the price of such equipment
skyrocketing, this gives a component mill an advantage in processing
efficiency that their customers cannot afford to match.
importantly, however, buying dimension removes the uncertainty
in raw material costs. Our dimension is produced to meet the customer's
exact specification. Unlike raw lumber, every container of dimension
will meet the same standard. Production time will be shortened
because production will begin with material that is already partially
machined. This allows a manufacturer to reduce their work in process
inventory and respond more quickly to customer orders. At the
same time, storage of components takes up less warehouse space
than rough lumber and the skilled employees that were previously
required for processing rough timber can now be shifted to more
important functions where their skills can be better utilized.