Throughout the summer, lumberyards and mills from Oregon to Maryland experienced fires, some devastating, others less so, but all highlighting the need for solid business continuity plans.
The following is just a partial listing of lumberyard blazes:
• June 6. Three buildings at Goad Lumber Co. in Hughesville, Md., were destroyed in a fire that took about 105 firefighters to put out.
• June 26. Lightning sparked a blaze at Mount Pleasant, N.C.–based Miller Lumber, burning down the company’s 124-year-old millwork shop.
• June 28. A kiln fire at Northland Corp. destroyed 35,000 board feet of poplar lumber in LaGrange, Ky.
• July 10. Hart Tie & Lumber in Black River Falls, Wis., suffered its third fire in seven months when a 2:30 a.m. blaze likely started in a wood shaving bin.
• July 10. A sawdust hopper at Trillium Lumber in Portland, Ore., caught fire but was put out in less than a half hour, even though firefighters were hampered by burnt high-voltage power lines and no nearby fire hydrants.
• July 23. Remer Cut-Stock Lumber suffered extensive damage from a fire that started around 8:45 p.m. at the Minnesota lumberyard. While fire marshals were unable to determine the cause, arson was not suspected, officials say.
• July 31. A cigarette was blamed for a fire at Mordoc Lumber in Klamath Falls, Ore.
• Aug. 15. Bowling Green, Ky., firefighters battled an early morning blaze at Hill-Motley Lumber Co.
• Aug. 23. Mechanical and electrical problems caused a fire at Pleasant Western Lumber in Monte Vista, Colo.
Arthur Kluttz, one of three owners of Miller Lumber, says he hopes to rebuild the supplier’s venerable millwork shop.
“It was a building for [millwork on] any kind of lumber—dressing, planing, molding—you name it, we could do it here,” he says. “We had antique machinery. We lost all of that.”
The company is struggling to keep workers employed, but with the millwork shop gone, so is a large part of its income. “It was just one of those things that happened,” Kluttz says.
Lightning strikes spark about 10% of fires at lumberyards and mills, according to Joseph McCrea, senior vice president of claims at Pennsylvania Lumbermens Mutual Insurance Co.
While news accounts suggest an uptick in lumberyard fires, McCrea says that PLM get more reports of fires at manufacturing plants, such as sawmills, pallet mills, and flooring makers. “Where there’s dust-collecting and sparks and welding, they are huge exposures,” he says.
Wood drying kilns are also high-risk areas for fires. A possible lightning strike started the fire at Northland Corp.’s oldest kiln in LaGrange, Ky. Keith Smith of the LaGrange Volunteer Fire Department says the neatly stacked layers of boards separated by slats made perfect kindling for the fire.
“We’re very, very fortunate,” says Tim Girardi, senior vice president of sales at Northland.
“When we added our other kilns, we added a thick metal plate between the kilns, and that really saved us” by keeping the fire contained to the single kiln, he says.
McCrea says even a small fire that disrupts operations can be fatal to a business. Fortunately, Northland has not only other kilns but good operations management that quickly switched gears and kept product rolling.
“Newspapers and especially TV love to have a reporter standing in front of a fire,” McCrea says. “Who do you think is watching that fire—all your customers.”
Customers expecting a delivery the next day may start calling other suppliers to make sure they get what they need if they think the fire has knocked a yard out of commission.
“You want your best salesman, or the owner himself, to call the customers and tell them what your game plan is,” McCrea says. “Even if you have to buy it from somebody else and not make a profit, keep the customer and make that delivery.”
Hitting the phones the day after the fire wasn’t a problem, Girardi says. “We’re in constant contact with our customers daily. A lot of sawmills called us [after the fire], but there were no problems.”
A supplier’s ability to survive a fire, according McCrea, depends largely on the size of the blaze. Companies with three-quarters of their property damaged have a 60% chance of going out of business, he says.
According to McCrea, most lumberyard fires do between $1 million to $2 million in damages. At larger yards, damages can be $4 million or more. The largest lumberyard claim PLM has paid was $7 million, although fires at manufacturing facilities can be considerably more expensive. Any fire causing $100,000 or more in damages prompts a visit from PLM’s “causes and origins” specialists, who work with the local fire marshal to determine the fire’s cause.
Yards with dust-collecting systems and saws that produce sawdust are at risk of fire, McCrea says. Smaller operations, too, may have a greater chance of a catastrophic fire because of more relaxed housekeeping policies, he points out. And then there’s the odd cause, like the pile of oil rags that spontaneously combusted where a worker was rebuilding a boat motor on his own time at the lumberyard where he worked.
“Fireworks are a big problem,” McCrea says. “We always dread the Fourth of July weekend.” Yards located in residential areas get torched inadvertently when a bottle rocket or other firework from a neighboring home lands in a pile of rubbish or sawdust.
Tall grass along railroad sidings also sparks lumberyard blazes when campfires by vagrants or others turn into brush fires that spread to an adjacent lumberyard, he says.
Regardless of the cause, the key to recovery is staying in touch with customers. Routinely backing up computers and keeping the backed-up data off-site ensure that customer information is available.
McCrea advises setting up temporary quarters in rental trailers and scheduling drop shipments from suppliers. Send out an email saying that orders will be filled. Put ads in newspapers to remind customers that the business is still open.
“I’m dealing in money,” McCrea says. “I can put you in a brand-new building, but if you’ve lost your customers, you might as well put the ‘for sale’ sign right up front.”