Our Future Customers – what will they expect of wood products A Manufacturers perspective Kevin Golding

We all know the answers… “Listen at every industry conference, read every industry body’s strategic plan, analyse every company’s annual report. It’s all in there – Innovate Add value Enter new markets Grow sustainably Create wealth and employment” Source: Coriolis Research 2005

If we know the answers, why do these describe the wood industry? Declining resource quality Scale based productivity Price based marketing

Breakthroughs are rare in the building industry Romans gave us concrete Victorian’s gave us structural steel US gave us the elevator – high rise What breakthrough will the wood products industry give us?

Five areas of change Government as a customer Urban intensification Off-site construction Low carbon Digital based productivity

Government as a customer Signals of change: Market failure Poor industry productivity

Government as a customer What are the implications? Unlock land in priority locations Provide major investment / development Support affordable housing Address barriers of growth Develop an alternative supply chain Off-shore Prefabrication

Urban Intensification Signals of change Land shortage and price Affordability Rent vs Own Ageing population Planning regulation

Urban Intensification What are the implications? Smaller land footprints 2 – 5 storey homes Terraced homes Concrete rather than timber

Off-site Construction Signals of change Skills shortage Low productivity Low certainty of delivery Costs Quality

Off-site Construction What are the implications? 7% lower cost 6 months quicker Improved cost / time predictability Improved quality, health and safety

Low Carbon Signals of change Carbon Act (late 2019) Climate change impacts / resilience Public awareness Government procurement Executive pay linked to carbon reduction

Low Carbon What are the implications? Cement responsible for 8% of the World’s carbon emissions If cement production were a country, it would be the third largest emitter behind China and the USA Wood products are the low carbon substitute for concrete

Digital Signals of change An underperforming construction industry Skills Productivity Quality Costs Waste Safety Procurement

Digital What are the implications? Projects delivered 40% faster With 80% less on site waste And 80% fewer safety incidents Resulting in 20% lower costs

A perfect storm for megatrends is converging WPMA Government as a Customer Urban Intensification Off-site Construction Low Carbon Digital

What to do about it “The best way to predict the future is to create it” - Peter Drucker

Closing thoughts Questions?