Resilience is learned. And we can keep getting better at it.
That’s Richard Wilson’s experience. He has spent his career running a small, custom wood products business, in a rapidly changing industry. The core of his work has been identifying what’s changing, navigating through it, and practicing resilience.
Richard and I have got a special connection around manufacturing. I grew up as a grease monkey in a cannery in California, and have worked in manufacturing on and off over the years. And in the 20 or so years that Richard and I have known each other, I’ve always really appreciated the opportunity to talk to him about what’s going on.
We talked about how much change he’s seen in his business over 30 years; how he navigates ups and downs; how he practices resilience; why he was able to grow his business after he lost his largest customer and largest partner; what Ernest Hemmingway taught him about resilience and forgetting; leaving the day at work; and the change currently on the horizon.
On what has changed most about his business
“Looking back over those 30 years, I’m amazed how much has changed. The equipment is more or less the same, but the markets that we service, the types of products, and the level of quality that we do have all changed dramatically.”
“And not just once or twice. In the last 30 years, there has been a paradigm shift every five to six years. And that shift is often scary for some people, and exciting for others.”
“We’ve also had a lot of business that has stayed with us. In fact, as much as things change, we have some customers who’ve been with us a full 30 years.”
“But one of the things I realized very early in my manufacturing career was that I’d better get used to change. I’d better get really good at it. And I better be able to lead the team through change.”
On how he navigates change
“In the last five years, a significant amount of sales went to Japan. That was business we’d cultivated over a period of 15 years with a significant partner: a forest company.”
“One day, when I was watching a newscast, I learned that the forest company was shutting down the mill that produced this product. And so we went from having our biggest customer and our biggest-by-far contributor of gross profit disappear in three months.”
“With any other business, that could have had a devastating impact. But with our business, we got busy finding a solution.”
“We started looking at new opportunities that maybe we hadn’t gone after before. The team built a plan, and we started gradually shifting our resources over to new opportunities — in particular, to something we call Cabinet One.”
On the idea that changed everything
“One of the things we realized is that because we’re an outsource company, we’re often one or two removed from final decision makers. So we wanted to try and fix that.”
“We wanted to try and get closer to our customers, closer to the decision makers, yet keep our fundamental B2B model and not deal on a B2C basis. So we started looking at opportunities, and we found a little bit of blue ocean.”
“We ended up creating a website with a configurator for cabinet companies or renovators to make truly custom cabinets online. Where they can order without, what I call, administrative friction. That is now our single biggest customer, and our single highest gross profit generator. And it’s still got lots of room to grow.”
On doing custom at scale
“People look at the towers that are going up all around the city and say, ‘You must be busy.’ But the reality is that we don’t touch those towers. We are into individual homes, medium- to higher-end, often with general contractor involvement. And we’re highly custom.”
“And that extends not only into residential, but also commercial. So we’re quite active now in doing commercial projects for people from cabinetry to millwork, for restaurants, offices and hospitality, to a point where we come dangerously close to becoming a millwork company — which is not what we are. We are still servicing the millwork and kitchen cabinet communities.”
On how he handles the ebbs and flows
“There are a few ways I get through difficult times. The first thing I come back to is having a strong balance sheet because you need it when there are ebbs and flows. When we do come into times of stress, the bank isn’t coming after you, and suppliers don’t even know it. So first and foremost, by having a strong balance sheet, I’ve got time and the patience to do what I need to do.”
“The second thing is that I’m a sole entrepreneur. But I have a partner, who’s my wife. So we set up a very disciplined approach to communicating the frustrations or excitements of the day. And I’ve found it very helpful to formalize that, so that I don’t come in and just constantly talk about my day.”
“Third, there’s personal resilience. I’ve studied it, I’ve failed at it, and succeeded at it. And I keep coming back to the fact that business resilience is equally as important as personal resilience. I often think about a quote from Ernest Hemingway: “The world breaks everyone, and afterward many are strong at the broken places.”
On laughter and forgetting
“Fourth, there’s the fact that people forget things. I had a conversation, once, with someone in my industry when I was going through something. And he said, ‘Richard, do you remember the time when…’”
“And I said, ‘Oh my gosh. I forgot about that.’”
“He said, ‘Yeah, that’s how long everything lasts. Nobody remembers. Just get through it, and keep charging on.’
On how he deals with problems
“I’ve got what I call a muscle memory when the company’s having some difficulties or disappointments. I go back to three scenarios.”
“The first is I ask, ‘What is the least likely to happen scenario, and what is the most likely to happen?’ And if I’m really deep in thought on those things, I’ll go and write them down and put budgets behind them. And often what I find is that it’s nowhere near the situation that I’m dreaming up in my head. And that is really comforting.”
“That’s the start only though. The next step is, ‘What are you gonna do about it?’ And from there, I morph into action plans, goals, objectives, and so on.”
“And then I bring my team into it because too often as a sole entrepreneur, I sit in my study thinking of all the solutions alone. And inevitably, when I invite my team in, they will either call me on stuff, or they’ll confirm that I’m on the right track. And in a lot of cases, they will bring up better ideas. And so I’m a big believer in being transparent. When problems occur, bringing in all the team, not just the senior team, but also some people in the plant that I respect and whose opinions I value.”
On what’s next
“In our business, we benefited from COVID after a few sort of white knuckle months. People were fixing up homes, and buying furniture, and all the things that we’re involved in. So if there was a cycle of five to six years, we’re coming through the next transition right now. I would say that we’re probably coming up to another run of growth. And I say that knowing that I’ve got some big, big business issues facing me right now.”
“One of the things that is a real challenge in the marketplace, I think in most places, but particularly where I operate is rent. My rent has doubled. I’ve seen just recently, a number of businesses shutting down because they just can’t afford the rent. If you’re not an owner, you end up essentially working for the landlord.”
“I’ve got a rent increase coming up, but I’ve already got the plan for how we’re gonna overcome that. It looks very, very doable even though it’s a massive amount of cost increase.”
“I do see some other storm clouds on the horizon, which are labor shortages. That has gotten better, but it’s going to get worse again once the market picks up.”
“A lot of people in our industry are looking at automation. That’s coming up as a real significant contributor to businesses and manufacturing.”
“I’m also looking at introducing new products. What we are finding is there’s more B2C approaching us right now. And so in the past, I’ve always said no B2C, but I am going to put a few trial balloons into that market and see if it’s something that suits a part of our business.”
“And finally, some geographic expansion. We’ve been ignoring the market up and down the I-5, which is where we have played really successfully in the past. So I think we’re going to go back to the I-5 market, because our product ships that way.”
“So, there are probably three or four really major opportunities that we’re pursuing right now and investing in.”
Richard Wilson is the president of Craftsman Specialty Products, which produces custom wood component manufacturing. In their words, “Our journey as experienced woodworking experts began in 1976. With a rich custom wood product history, we’ve always upheld the values of quality craftsmanship and woodworking technology leadership. Our commitment to sustainable wood manufacturing is supported by a dedicated woodworking team that continuously innovates to provide client-focused wood services.”