Russ Permann and Taiga Building Products

Hardlines Associate Editor and podcast host Geoff McLarney and Senior Editor Steve Payne interview Russ Permann, President and CEO of Taiga Building Products on how Taiga weathered the pandemic, how the supply chain looks today, and his expectations for technology improvements for the business and the industry.

 

Key Takeaways:

 

[:41] Michael introduces Russ Permann, President and CEO of Taiga Building Products. The correct way to pronounce Taiga is both tay-ga and tie-ga! Calgary, Alberta is Russ’s office, but the corporate office of Taiga Building Products is in Vancouver.

 

[2:15] During the pandemic, Taiga Building Products focused mainly on the basics. It was a difficult period. They acted with integrity and honesty with vendors and customers.

 

[3:38] Taiga Building Products uses a hybrid system of the right technology in the right setting for the right event. They had started online meetings before the pandemic. They hold in-person meetings as well.

 

[4:47] Materials are readily available. Interest rates are up and housing starts are down, so demand is down. Ocean freight is running and lead times are more predictable. In certain categories, supply restraints will come again.

 

[7:02] Mills are closing for economic reasons. Particularly in British Columbia. The log supply to the mills has been reduced by the old-growth restrictions in BC.

 

[8:59] Prices on almost all commodities have returned to pre-COVID-19 levels. That may not be a permanent condition. Supply limitations in BC and longer trucking routes to mills have caused a permanent price increase in wood products. Russ expects more mill closures.

 

[10:43] Taiga has invested heavily in technology. As an industry, there is a transparency gap in the supply chain that Russ wants to address before others come in to disrupt the industry.

 

[11:53] Outsiders are willing to take a risk to disrupt the industry because of its sheer size and because it’s an industry that hasn’t spent a lot of time focusing on productivity improvements.

[12:25] Taiga Building Products is focusing on two areas of technology, first, making Taiga Building Products more efficient and frictionless to do business with, and second, improving transparency between Taiga Building Products, their vendors, and customers.

 

[13:12] Russ describes the warehouse management systems technology adopted already by Taiga Building Products starting in 2015. That has made them more internally transparent, accurate, and reliable. They know what they have, where it is, and how long it takes to ship it.

 

[14:55] There is potential for disruption of the building industry, based on what has happened already, such as with large-scale modular buildings. Markets are driven by a desire for cost efficiency. Technology is one of the best facilitators of cost efficiency.

 

[16:54] It’s incumbent on Russ and others who have benefited a lot from this industry to think about how to leverage technology to gain cost efficiency, get better, and be more predictable.

 

[18:05] Every time fuel rises, it never scales back to the previous cost. The most expensive mile is an empty mile so they concentrate on load fulfillment. Russ explains how to optimize a route to ensure a full truck.

 

[20:12] Russ’s last thoughts: “We’re still a business that gets things done through our people. It’s an industry made up of people and it’s one thing I really enjoy about the world we live in today is that there’s still a lot of stuff done in our business that’s done eye-to-eye with people you can trust. It’s really fulfilling. … Here at Taiga we really value our people.”

 

[21:34] Geoff and Steve thank Russ Permann for joining What’s In Store and giving listeners a better understanding of Taiga Building Products.

 

About Us:

What’s in Store is a podcast series of the Hardlines Information Network, brought to you by Jeld-Wen

Resources:

Hardlines.ca

Geoff McLarney

Steve Payne

Sponsor: Jeld-Wen

Russ Permann

Taiga Building Products

 

Quotes:

“I would describe it as a hybrid. I think we’re learning to use the right technology in the right setting for the right event. We’re trying to match those appropriately.” — Russ

 

“We’ve seen some early attempts at pairing technology with building, construction, and LBM concepts that haven’t quite … achieved the desired scale that they’ve looked to get to but what they have demonstrated … is that they can raise a lot of interested capital.” — Russ

 

“The most expensive mile is an empty mile, in any business, and so the way to optimize the use of freight is to get as much on a vehicle as possible.” — Russ

 

“If ever you have a problem, if you’re a customer or a vendor, call our people and they will do their best to make it right for you. If you need anything, call our people, and if you need my assistance, hopefully, I won’t mess it up but feel free to give me a call.” — Russ