Selling hardwood lumber according to professional standards is an industry that has been around for almost 124 years in the United States. The National Hardwood Lumber Association (NHLA) started in 1898 when 37 lumbermen met in Chicago to establish uniformity in the trade of hardwood lumber. Through the years, hardwood production has evolved while many of the business practices have remained the same.
An innovative technology startup is attempting to change how lumber is bought and sold in the country. The Mickey Marketplace wants to replace handshakes and verbal agreements with technology, an online marketplace and innovative purchasing networks. Mickey (https://marketplace.mickey.io) launched this summer with a focus on grade hardwood lumber and hopes to add low-grade material and other products in the near future. Recently, Mickey has introduced OSB and SPF on its platform.
Alex Rabens, co-founder and CEO of Mickey, sat down for a discussion with Pallet Enterprise to review the technology and ideas behind this unique proposition.
Rabens explained, “We’re giving forest product suppliers access to a national liquid marketplace and ultimately the opportunity to sell at market prices without being undercut by middlemen and wholesalers.”
Suppliers, such as Wisconsin’s Tigerton Lumber Company are happy about the potential of taking their business online. “This is very exciting,” said Mike Schulke, vice president of sales and marketing. “This is exactly the direction the industry needs to go!”
The Mickey Marketplace offers two options – a blind online marketplace and a free online portal designed to manage existing vendor relationships. In the blind marketplace, certified buyers and sellers conduct business with Mickey providing customer service and support. Rabens stated, “The transaction flows through Mickey. The buyer ships in care of Mickey, and our logistics partner dispatches a truck. The supplier doesn’t know where the shipment is going, and the buyer doesn’t know who supplied the lumber. Mickey handles all customer service and quality control with the order.” The financial transaction is conducted through a third party service.
A big benefit is that the seller can focus on production while accessing a larger network of potential customers. Buyers can cut out middlemen and brokers and locate the best price and closest supplier. The Mickey marketplace gathers data and analytics that are useful for both buyers and sellers. When a supplier ships a load, the supplier is paid immediately. This helps improve cash flow for the seller.
Companies can also use the Mickey platform for free to manage their own customer relationships and take advantage of aggregate data and insight from other similar transactions.
The system currently covers full truckloads of kiln-dried hardwood, rough or S2S in Western Red Alder, White or Black Ash, Basswood, Beech, Yellow or White Birch, Cherry, Hard or Soft or Pacific Coast Maple, Red or White Oak, Walnut, Hickory, Sap Gum, Tupelo, Sycamore and Cottonwood. The inventory includes a variety of thicknesses from 3/4 to 16/4 and random widths and lengths. Rabens added, “The reason we chose hardwood lumber is that it is the most attribute intensive commodity product. This means there are a lot of different variances in how people buy hardwood lumber.”
The Mickey platform is currently geared toward hardwood lumber trading. The company plans to roll out softwood trading in the future as well as offerings for low-grade lumber and other wood products. Transactions are conducted through a Web-based portal accessed from a desktop computer. Eventually, the company plans to develop an app for mobile order processing. Only sawmills, concentration yards and other producers are able to sell on the Mickey platform. Brokers and wholesalers that don’t take physical possession of the lumber or wood products are not allowed to participate. Target buyers range from small custom cabinet shop to a large wholesale distributor or retailer with a brick-and-mortar location.
Rabens said, “We are providing a brand new way to do business for an industry that has been used to doing business the same way for decades…It is going to take time to get buyers significantly comfortable with it.”
Mickey is not charging a commission or requiring any fees for customers to use the portal or software. Its focus right now is building up the customer base, receiving customer feedback, establishing relationships and gathering data. Rabens further commented, “We are trying to create a stress free environment for a supplier to produce its product and sell it.”
The company hopes to expand into other vertical industries and commodities in the future. This online marketplace may even help companies comply with environmental goals and reporting. Rabens suggested, “Eventually, we want to be able to show a buyer’s or seller’s carbon footprint…We are working on developing that now into the system.”
For more information on the Mickey online Marketplace, visit https://marketplace.mickey.io.
