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Amish Furniture Makers Succeed in Cluster: Ohio Amish Settlement Fosters Prosperous, Growing Hardwood Furniture Industry

Amish in Rural Ohio Thrive at Making Hardwood Furniture

By April Terreri
Date Posted: 5/1/2008


      Something interesting is happening in the rural Amish community in Holmes County, Ohio. Members of this religious community have developed a thriving wood furniture manufacturing industry. Some believe it is the re-emergence of the U.S. furniture industry, the 21st century’s answer to the lost furniture kingdom of High Point, North Carolina.

      Characteristic to Amish-built furniture is its high quality and locally produced, solid-wood construction. “They don’t have to work hard to advertise these features,” said Matt Bumgardner, research forest products technologist at the U.S. Forest Service Northern Research Station in Delaware, Oh. “It is simply understood universally. That is their signature.”

      Matt and a colleague, Bob Romig, had discussed the quietly burgeoning Amish furniture manufacturing base in Holmes County.

      “From his positions with Ohio State University and the Ohio Forestry Association, Bob had noticed the development of the Amish  furniture cluster. One day during a conversation, the light went on, so to speak, and we decided to get a handle on the size of this cluster.”

      Matt, Bob, and another colleague, Bill Luppold with the U.S. Forest Service in Princeton, W.Va., studied and interviewed the Amish furniture manufacturers. The three co-authored an article, ‘Wood Use by Ohio’s Amish Furniture Cluster,’ for the December 2007 issue of Forest Products Journal.

      Holmes County has a population of about 40,000 people, according to the local chamber of commerce. About half the population, 19,000, is Amish. In fact, it may be the largest Amish settlement in the world.

      There are about 450 small furniture makers (usually family-owned and family-operated) within the cluster in Holmes County and surrounding area.

Study of Amish Cluster

      “One of the first things we wanted to discover was the amount of wood they were using as a measure of their impact,” said Matt. “After talking with some of the manufacturers there, we learned the extent of the wood use was dramatic, and we also discovered this cluster is practicing a lot of the same things successful U.S. businesses use to achieve and maintain competitiveness. The proof that it is working there is in the number of firms forming and the amount of wood they are using. These two things went together as part of the story.”

      The cluster of Amish furniture manufacturers uses about 43.5 million board feet of hardwood, the researchers found. That represents about 11% of Ohio’s total hardwood lumber production and 19% of its hardwood grade lumber production. The value of the furniture shipments was placed at $280.7 million.

      The majority of the Amish wood businesses operating in the county were established within the last 15 years. By contrast, during the same period overall domestic furniture manufacturing has been in decline, with some companies moving operations overseas or importing furniture.

      “What is really interesting is they just began their own furniture exposition and trade show this year – a kind of mini High Point,” Matt said. The exposition, called the Ohio Hardwood Furniture Market (www.ohiohardwoodfurnituremarket.com) and sponsored by the Holmes County Hardwood Furniture Builders Guild, was held earlier this year.

      Although the Amish businesses are small compared to the furniture industry in High Point, they are similar — a cluster of manufacturers and their suppliers, finishers, and distributors.

      “The principle at work in the cluster is they all source locally from each other, so there is trust and respect, and the suppliers are in tune with the needs of the manufacturers,” said Matt. “The end result is you get products here that you never could get from China or other offshore locations.”

      The cluster sources lumber mainly from three channels. One is from very small Amish sawmills in the area that serve the furniture manufacturers exclusively. Another source of lumber is larger sawmills in the region, which may or may not be Amish-owned and Amish-operated. Lastly, some distributors get lumber from other sources and serve as a channel intermediary to move the lumber to the Amish furniture makers.

Small Shops, Close Proximity

      Most of the furniture manufacturing businesses are small shops with about three or four employees. “Part of the cluster success is there are so many shops in close proximity, facilitating communication and cooperation among the various shops,” noted Matt.

      The shops tend to specialize in producing a particular product. For instance, one shop might make dining room chairs while another will make matching dining room tables. They send the furniture to a finishing shop where it receives consistent stains and is finally sold as a set.

      The cluster operates with a “unique mix of competition and cooperation at the same time,” noted Matt. “The competition appears to operate more like peer pressure in that shops don’t want to bring down the entire cluster by producing poor quality. So they strive to maintain a standard that is as high as everyone else’s.”

      The cluster of businesses centered around furniture making provides a way of life for the Amish that is on par with their farming operations. “This is a way for them to stay on the farm and create jobs for their kids,” said Matt. “The dedication to make it work helps that competitiveness.”

      The Amish businesses produce high quality products, noted Matt. Many of them are equipped with state-of-the-art machinery and equipment while others rely on hand tools and manual labor. Amish doctrine forbids members from connecting to the electric power grid, so businesses that run machinery use generators to produce electricity.

      Wayne Hochstetler is one of seven family partners who owns and operates three businesses in Millersburg. Hochstetler Wood Ltd. produces furniture components, H.W. Chair Ltd. manufactures dining room chairs, and Tiverton Timber Ltd. buys and manages forestland for investment and recreation. (Tiverton Timber won the Ohio Tree Farmer of the Year award for 2006.) Wayne employs 35 people, including family members, in both woodworking businesses.

      Hostetler Wood buys lumber, green and dry. Green lumber is kiln-dried by other companies in the local furniture industry cluster. The dried lumber is remanufactured into furniture components. The company uses primarily red oak, maple, cherry, poplar, white oak, and hickory.

      “Our company is a rough mill where we plane the lumber, rip it, and then we glue it into panels which we cut to length,” said Wayne. “Then we sand it and do the primary machining on it to prepare it for H.W. Chair and other furniture shops in the cluster to make into furniture.” H.W. Chair assembles the components into furniture.

      H.W. Chair produces residential dining room chairs, chairs for the hospitality industry and chairs for institutions, like colleges and libraries. The company sells about 20% of its production within Ohio, about 60% in Eastern states, 12% to customers in the West and 8% to Canadian markets.

      H.W. Chair sells its furniture direct to commercial or institutional customers or wholesale, not to individual consumers. Wayne’s distribution model includes selling to furniture stores, furniture wholesalers and distributors, and other furniture manufacturers.

Competitive, Cooperative

      “What the cluster does is it spreads out the investment risk,” observed Wayne. “Many of the shops, therefore, specialize in a relatively narrow field of production.”

      For instance, many furniture manufacturers do not have an in-house rough mill, so they buy glued-up panels from one business, send them to another for machining, and bring the components back to their shop for final assembly.

      “We probably cover a bit broader field than the average shop in the cluster because we have our own rough mill,” noted Wayne. His business does not have finishing operations, however, so he sends the furniture to other shops in the area for that task.

      The tight-knit Amish community facilitates this unusual competitive yet cooperative way of doing business. “We sell parts to and buy from our competitors,” Wayne said. “You either know them or know of them.”

      Holmes County is different from other rural communities that often lament the ‘brain drain’ that occurs when younger generations reach adulthood and move away to get a job. “Most will stay in the community or move to a similar community, so there is not that kind of ‘brain drain’ where we lose our most skilled workers to other areas,” said Wayne. “People here enjoy this way of life, and they want to stay here to live and work.”

      Wayne and other Amish prefer to market and sell their furniture on its own merits – quality and workmanship. “We don’t promote our furniture as ‘Amish-made,’ ” he said. “We also don’t advertise or use the word ‘Amish’ in our business. I feel the furniture we produce should not have to rely on that kind of promotion because we always want to give the customer his money’s worth by always producing the very best quality and workmanship.”

      Wayne does no active marketing. He has never attended trade shows, relying instead on word-of-mouth to grow his business.

      Buyers for furniture stores and wholesalers purchase chairs from H.W. Chair to go with tables or hutches they buy from other companies, creating a suite of furniture they market under their own label. “We also make chairs for other furniture manufacturers who want our chairs to put with their products to sell as their own products. For this reason, nobody wants our name on the chairs we sell to them,” explained Wayne. H.W. Chair sells primarily into Ohio, Pennsylvania, Missouri, Michigan, and Arkansas.

      What is it about the Amish furniture manufacturers that has enabled them to achieve and maintain continued success and growth? Being small and nimble, which allows a company to respond quickly to changing market demands, said Wayne.

      “If you look at our furniture cluster and compare what we produce to what the country needs, we really don’t make a very big dent. But we are filling in the void left from when other manufacturers went offshore. What keeps us going is our high quality, smaller runs, quicker turnarounds, and customization.”

Contract Manufacturing

      Before the cluster became established, the Amish furniture makers did not attract buyers from outside the area. “But now the cluster is large enough to attract outside buyers,” noted Wayne, “and it also brings in dealers who know the kinds of products they can find here.”

      The cluster is comprised of small, family-owned and family-operated companies. Family members work in the shop alongside other employees. “This makes for an overall low-overhead operation,” Wayne said. “Being small allows us to get things done quicker because we don’t have to run an idea up the chain of command and then wait for a decision. We just get our heads together and do whatever needs to be done, when it needs to be done.”

      Contract manufacturing is a new and promising method for securing continued growth for the Amish craftsmen. A few years ago, Wayne would not have considered making and supplying furniture under contract. “Six years ago, I would have said we don’t do this, but we are now doing a fair amount. It used to be we only made our own styles.”

      Why the change in direction? “We needed the work, and the market changed,” he said. The slumping homebuilding industry has depressed furniture sales, so Wayne is doing more and more contract manufacturing, especially for the hospitality industry, which is still vital. “It’s much harder for those people to go overseas for 100 or 500 chairs in a one-shot deal,” he noted, “and they can get what they want right here. We offer a good quality chair at a fair price.”

      Manufacturing methods run the gamut throughout the cluster – from hand tools to high-tech machinery and equipment or a blend of the two.

      Roy Miller is the owner of Country View Woodworking in Millersburg, the largest Amish-owned furniture manufacturing business in Holmes County. His company uses hand tools and power equipment.

      Like other Amish in the community, Roy does not buy electricity off the grid, but he uses generators to make his own electricity. “In my business,” he said, “you will see us using 400-horsepower diesel-driven engines running an air compressor and hydraulic pumps, which run our hydraulic-powered equipment,” he said. Lights also use generated electric power.

Responsive to Market

      Continued, sustained growth and expansion is not for everyone in the cluster, acknowledged Roy. “Some businesses want to grow only to a certain point where the work is just enough for the father and two sons to handle, for example. Once their customer base begins to outgrow them, they will likely send overflow customers to another shop. Since I was willing to grow and expand my customer base, I got involved in contract manufacturing about 10 years ago.”

      Today, Roy has 12 independent shops producing furniture for him. The combined production from these shops and his own business is about 155 pieces of furniture per week. Half the furniture is made from oak, another 30% from cherry and another 15% from quarter-sawn white oak. The remaining 15% is made from brown maple and hickory.

      Roy’s company specializes in entertainment centers, but it also offers tables, chairs, dining and living room suites, and other pieces – hutches, sideboards, corner hutches and occasional tables. He has over 400 accounts, and the furniture is sold into 45 states.

      Roy may manufacture about 15 different styles of dining room suites. “Instead of building them all in my shop, I asked a small, one- or two-man shop if they would like to work for me,” he said. “That shop might build a china cabinet or a corner hutch for me. Every three weeks I give them the orders, and they build the furniture for me. Then I bring those pieces into my shop, and I do the doors, drawers, finishing and assembly before I sell the pieces.”

      What the small shops like is that as soon as Roy picks up an order from them, he writes them a check. “They don’t have to deal with receivables or deal with salesmen,” he said. “I even furnish them lumber in some cases.”

      Roy also is becoming a distributor for other shops with smaller customer bases. “The owners of smaller shops come to me, asking if they can share in my larger customer base. They also want me to market their products. This is starting to happen more now, and it’s interesting to see how the smaller shops need this kind of connection to a larger shop in this economy. And the cluster is able to provide this kind of synergy.”

      “This is a great way for me to grow along with my customer base while getting other local people involved and giving them work,” added Roy.

Guild Promotes Industry

      Roy is president of the Hardwood Furniture Builders Guild, whose mission is ‘to promote and market domestically manufactured home furnishings of unparalleled value and quality, while providing customers with superior service and integrity.’ The Holmes County Chamber of Commerce handles the Guild’s administrative work.

      The guild provides economies of scale when it comes to spreading the word about the cluster’s existence and products. “I am a larger business so I can afford to spend more marketing my furniture, but the smaller shops cannot afford to spend a lot on advertising,” Roy explained.

      “What is so good about the guild is everyone can throw into the pool what they can afford, depending on their size. This gives us all the strength to reach people we hadn’t thought of selling to in the past.”

      The Guild recently developed an identifier logo that will be stamped on furniture coming out of Holmes County that meets certain standards of excellence. “People who see this logo will become acquainted with our furniture, and they will begin to ask for our furniture more and more,” Roy said.

      Retail furniture store chains are beginning to take notice of the quality products the cluster is producing. “They can’t sell what they have from China, and they are only selling on price,” said Roy. “So they are looking to us, and they are willing to try to sell our furniture, even though they are a bit skeptical about whether they can sell a dining room set for $3,995 when they are used to selling…sets for $995. But they are telling us they can’t sell what they’ve got from China, and they are not reaching the customers they need to reach in order to sell the furniture our cluster produces. They are very willing to work with us, and we all think we have a product they can sell.”

      With all the hubbub of activity happening within the cluster, which has its eyes and ears open to the needs of the American consumer, it is natural to wonder if a new American furniture manufacturing center is being created quietly under our noses.

      “People might not be thinking Holmes County yet when it comes to locating furniture manufacturing excellence, but this is what the guild is trying to accomplish,” said Roy. “I am convinced that with the Amish communities in the states of Ohio, Pennsylvania, and Indiana working together, we can really take control of the hardwood furniture market in the U.S. The market used to be in High Point, but it’s all overseas now. It’s there to be had, and we should control it.”

      Although the future looks promising for the Amish, it is prudent to remember that their output still represents only a small percentage of domestically made furniture, added Wayne.

      The guild is taking off very quickly. It has about 200 member companies a year after its inception. The exposition it sponsored was very successful, drawing over 700 furniture buyers nationwide. “We wrote lots of orders during that event,” noted Roy.

Bright Future

      The future looks very bright for the Amish furniture makers, agreed Matt. “There is evidence of product diversification, which is another sign they know what’s going on in the overall industry, and they are able to make quick adjustments to the market needs. They are already moving into producing commercial and hospitality furniture.”

      Matt and his colleagues plan to conduct a second study of the cluster, hoping to gain more insight into the distribution channels as well as the percentage of  furniture going to which states and which customers.

      “Another question we have is what percentage of production is staying in Ohio and what part is going out of the state,” he said. “What we do know for sure is Amish manufacturers do their homework, and their designs are very stylish and appealing.”

      The savvy businessmen in the cluster truly understand the value of listening to customers and providing them with what they want and need. For example, when Country View Woodworking first started building entertainment centers 15 years ago, the company’s designs did not include doors on the entertainment centers.

      “Once we heard that our customers wanted pocket doors, we began to build the centers with these doors, and now this is a standard item we offer,” said Roy. “Listening to our customers is part of our success story. My marketing person, who has extensive experience in marketing, says the biggest reason businesses fail is they don’t respond to customers’ requests or to the changing market trends and needs.”

      The Amish furniture makers are not interested in selling based on price. Roy emphasizes to his retailers that he does not endorse price wars. “We are selling quality and value, and we offer good products and good service for a fair price,” he said. “This is why we flourish, even in tough times. Our products will last for generations, and we tell our customers this furniture is for you and your grandkids to enjoy.”

      The growth of the Amish furniture making cluster is impressive so far, especially considering it was started by retired farmers who began building furniture. “We went from a farming industry some 20 years ago to a woodworking industry in practically no time,” Roy said.

      It has become a way of life now for the community, its success based on a solid foundation of a strong work ethic. “Most of us have only an eighth-grade education,” said Roy, “but we are successful because we work very hard, and we surround ourselves with business people to help us understand how to become more successful using modern business metrics.”

Stain Standards Help Ensure Furniture Quality

HOLMES COUNTY, Ohio — The cluster of Amish furniture manufacturers in this rural Ohio county is relentless in establishing quality and consistency standards for every piece of furniture it produces.

      Just as the mission of the cluster’s Hardwood Furniture Builders Guild (HFBG) is to produce and promote home furnishings of unparalleled value and quality (see accompanying article), the Ohio Certified Stains (OCS) group strives to ensure color continuity and consistency in the stains used to finish furniture made by the cluster of hundreds of small manufacturers.

      The goal of the OCS, established in 2005, was to create standards of excellence through color consistency. At the time, the manufacturing cluster had four different suppliers of stains, and particular colors were not consistent from supplier to supplier.

      Consistency in the finishing process was even more critical because several small furniture makers may contribute pieces to a complete suit of furniture. For example, three different furniture manufacturers within the cluster might be involved in producing a dining room suite — one producing chairs, another, the dining table, and a third making another piece.

      “Those manufacturers might each use a different finisher,” said Roy Miller, president of the HFBG, “so what we were getting were three different hues of the same color. There was no color consistency in any given suite. So we certified the stain colors, encouraging the stain suppliers to adhere to what we established as the standard for particular colors.”

      Seven suppliers now are licensed to provide stains to finish the cluster’s hardwood furniture products. “We have ownership of the OCS logo and licensed distributors sell our OCS products,” continued Roy. “Other Amish communities have had to adhere to what we established here because the same furniture retailers are buying from us as well as from Amish furniture manufacturers in Indiana and Pennsylvania. So the retailers want that color consistency our community offers. Basically, they forced the manufacturers in Indiana and Pennsylvania to use our certified stains as well.”

      The stains are monitored on a continual basis. “Every three months, we have our suppliers bring us samples of the stains so we can check them for color continuity and consistency,” reported Jonas Miller, president of the OCS groups and owner of Trailway Wood in Dundee, Ohio.

      The OCS group offers 15 standard colors, ranging from natural to dark brown to a reddish deep purple. The group also is developing new stain colors it will offer soon.

      “We have to keep in mind that wood is a natural product, and therefore, natural color variations do exist in any species as it grows from region to region,” Jonas explained. “Having these master color samples helps overcome some of the color issues inherent in the wood. Even so, there could still be very slight variations in the final product simply because of the uniqueness of solid wood.”

      The OCS standard is an excellent selling tool, offering furniture retailers peace of mind when ordering furniture from the Amish cluster – or from Amish furniture makers in Indiana and Pennsylvania. “The OCS logo assures that retailers will receive products that have color consistency in the products they offer for sale to their consumers,” continued Roy. “This means they don’t have to hope that the pieces they purchase from several different furniture manufacturers will match in color and hue.”

      “If they can afford to buy only one or two pieces this year, they have the assurance that a few years down the road when they have the funds, they will be able to buy the remaining pieces that will match,” added Roy.

      “I can’t stress enough the importance of what we are doing here in our cluster and how unique all of this is to the furniture industry,” said Roy. “No piece of furniture manufactured overseas can even come close to matching the quality or consistency of what we offer.”

      The OCS group will continue to promote the OCS logo so consumers will understand the value of the furniture they buy. “My long-term goal is to market the logo to consumers so our furniture will be consumer-driven and consumers will ask for OCS furniture at the retailer level,” Roy said.

      Many manufacturers also offer furniture-care repair kits to retailers to sell to consumers. Roy and Jonas offer a complimentary repair kit with every piece of furniture they sell.

      Ray Morefield, a business consultant and owner of Related Sales, recalls the truth-in-advertising concept that is used to protect American consumers. “Many offshore Pacific Rim manufacturers advertise their furniture as ‘cherry finish’ nowadays,” said Ray, “suggesting that the furniture is a product made from solid cherry wood when it is not. The critical thing about our OCS products is they offer a benchmark for ensuring to retailers and consumers that this community practices ethical methods to the highest degree possible.”




 






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