Monday, March 5, 2001	Go to: S M T W T F S
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Changing with the pace of history

Phila. wood importer survives coups, wars and recessions by adjusting.

From South America to Africa, tropical wood arrives at Thompson Mahogany Co.’s lumber yard in Philadelphia. Carlo Riveria fills an order. Customers include coffin makers and deck builders. (Peter Tobia / Inquirer)

By Mark Jaffe
INQUIRER STAFF WRITER

In 1840, a young carpenter named Lewis Thompson arrived from England and opened a small cabinet and furniture business at 11th Street and Ridge Avenue.

In those days Philadelphia was the nation's furniture-manufacturing center, and the staples of the business were mahogany and marble.

"It was hard to get dependable supplies, so Thompson's started importing its own mahogany from Mexico and Central America," said Robert Thompson, Lewis Thompson's great-great-grandson. "Pretty soon, the importing business was going gangbusters, and they stopped making furniture."

Today the Thompson Mahogany Co., in a modest redbrick building at 7400 Edmund Street in Northeast Philadelphia, is still bringing in valuable tropical woods.

The company is one of the nation's preeminent suppliers of tropical woods, which find their way into not only furniture, but guitars, coffins, decorative doors and the deck on Microsoft billionaire Bill Gates' mansion.

Thompson has managed to endure through wars, depressions, foreign political coups and protests from environmentalists - stiff challenges for a business dependant on goods from remote and troubled corners of the world.

"They've got a very good reputation," said George Barrett, editor of the industry newsletter Hardwood Review. "There are less than 30 firms in the country in the direct [hardwood] import business, and Thompson certainly is one of the top."

While bigger, more powerful companies have come and gone, Thompson is a study in how a speciality business - focused on a precise niche, with innovative strategies - can survive.

At home, the company has prospered by managing to find new markets - be it a newfangled invention in the 1920s called the radio or the current demand for durable outdoor decking.

Abroad it has made bold moves - such as building a sawmill 900 miles up the Amazon River in 1934. As the first American company with mill operations in Brazil, Thompson dramatically cut its shipping costs.

"We beat the pants off those guys who were still shipping logs," said Robert Thompson, now 80, who worked at the Amazon mill.

Today, the privately held company generates about $20 million in annual sales from 7.5 million board feet of imported woods, according to Donald Thompson, the company president.

(Donald Thompson - who is no relation to the original Thompson family - purchased the business in 1985 after Robert Thompson retired.)

The company, which employs 50 people, operates a lumber yard at Edmund Street and a second facility in Fairless Hills, where it prepares the wood to be used for flooring and decking.

The woods are purchased mainly in Africa, South America, Southeast Asia and Australia. The imports include 26 species - including Bolivian rosewood, Peruvian walnut, African zebrawood and Australian cypress. The four major stocks are chambray and ipe for decking, jotoba (also know as Brazilian cherry) for flooring, and mahogany - from both Africa and South America - for furniture.

The company uses the South Jersey Port Corp. in Camden for landing its cargo. The timber is sorted, dried and stored at the Edmund Street yard. Orders are filled on a weekly-to-monthly basis and shipped by truck.

No raw logs are imported by Thompson, only sawn wood from local vendors.

"We try to deal with the most reputable vendors and try to offer good prices. That assures our supplies and also helps their economies," Donald Thompson said.

In the last decade, some environmental groups have opposed the trade in tropical wood, charging that it threatens the maintenance of tropical rain forests - among the most biologically rich habitats on Earth.

Asked about such critics, Donald Thompson responded, "What is it they want? No timber cutting at all? That's a lot of jobs and money to ask a poor country to forgo."

When a tropical forest is logged for high-quality woods - such as mahogany - only the largest, most valuable trees are taken. Generally, more than 90 percent of the trees are left standing.

"It's sustainable logging," he said.

The critics counter that such logging is still disruptive enough to threaten the forest.

Overall, the American impact on the tropical trade is limited, with the country importing about 5 percent of the total tropical timber cut.

Thompson is actually importing one third as much mahogany - about three million feet - as it did 100 years ago. Today, demand is stable, Donald Thompson said. "Generally, we are serving very specialized customers."

Among those customers have been the piano maker Steinway & Sons, the guitar maker C.F. Martin & Co., and the Marsellus Casket Co., which makes top-of-the-line caskets used for celebrities and the wealthy.

Wholesale prices over the last century have gone from less than 20 cents a board foot in 1900 for South American mahogany to about $3.75 today, Thompson said. (Twenty cents in 1901 is worth approximately $3.99 in today's dollars.)

While stability may be the order of the day in the sales market, the purchase of tropical wood has always been an adventure.

"Supplies keep shifting," said Donald Thompson. "Part of it is availability and part of it is politics."

For example, after operating its mill in Brazil for nearly 20 years, the company sold it to its manager, a Brazilian national, in 1954 for $1. At the time, the Brazilian government had banned the exports of sawn timber, hoping to force the development of a furniture industry.

Eventually, the company returned to Brazil. The ban never created a furniture industry, and a subsequent regime lifted the restrictions.

Similarly, after World War II, Robert Thompson went to West Africa in search of new supplies, and the company began exporting from the Gold Coast.

When the British colony gained its independence in 1957, the new government of Ghana stopped major logging activities. When Ghana lifted its ban, Thompson returned as an exporter.

Even though World War I interrupted commerce, Thompson survived because "my grandfather had a good supply of stock and the war didn't last that long for America," Robert Thompson said. A major customer became the U.S. Navy, which bought mahogany to make ship propellers.

"When the Depression came, furniture sales fell [because] nobody could afford new furniture," he said. "But everyone started buying radios.

During the 1930s, Thompson became a supplier for the burgeoning radio industry. Thompson produced wooden bases for the first Atwater Kent radios, which were manufactured in Philadelphia.

Thompson opened a mill in Moorefield, W. Va., to make walnut veneer for grand "cathedral" radios. "We couldn't make veneer fast enough. We ran that mill around the clock," Robert Thompson said.

During World War II, the private import business just about vanished. But under agreement with the U.S. government, Thompson continued bringing in mahogany from South America for the war effort. That wood found its way into PT boats and military gliders.

The growth market today, according to Donald Thompson, is in decking and flooring, which in the last seven years has become about 50 percent of the company's business.

At the Fairless Hills facility - housed in an old warehouse - Thompson creates flooring and decking kits for builders and suppliers.

The appeal of hard and dense tropical woods such as ipe for decking is that they are so resistant to the elements that they need no chemical treatment for decay. "There is a segment of the market that doesn't want chemically treated wood - people worried about the health and environment effect of wood treated with things like arsenic," Donald Thompson explained.

The wholesale price for ipe decking is about $2.20 a board foot - double the price of pressure-treated domestic pine, according to Donald Thompson.

A specialty market like hardwood is, of course, vulnerable to the loss of supplies abroad and shifting consumer tastes at home.

"The market is always moving and changing both on the supply side and the demand side," Donald Thompson said. "So when you are an importer, you have to stay on your toes."