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Jensen Leisure finds Bolivian ipe opens doors

Jensen Leisure finds Bolivian ipe opens doors

An ipe tree in front of the IMR factory.

By early December a sea of Jensen Leisure Outdoor Furniture pallets fill the shipping area of the IMR factory in Santa Cruz, Bolivia, waiting to be loaded into containers for their journey north to the United States.

It’s been two years since the company formerly known as Jensen Jarrah entered into a joint venture with the Roda Group, IMR’s parent’s group and a leading ceramic and wood products manufacturer in Bolivia.

The rewards have already proven the long-term viability of the move. Not only did the agreement give the company access to 100% FSC-certified ipe wood for its high-quality outdoor furniture line, Jensen has increased its dealer base for 2010 by 20%, and production is going full tilt.

“This is a tremendous opportunity for both companies — a classic win/win situation,” said Max Jensen, CEO of Jensen Leisure.

Getting to this point has had its challenges. In fact, for a time, it appeared as if there would be no Jensen outdoor furniture company of any kind today.

Max Jensen started manufacturing outdoor furniture in Australia in 1980 and within a few years built a national market. Jensen Jarrah entered the U.S. market in the early 1990s.

The company thrived for many years. But by the mid 2000s, the quality and supply of Australian jarrah wood was going down as the price went up. It was clear to Jensen that he was facing a variety of factors he couldn’t control.

Hlodver Olafsson and Robert Simeone on the production floor.

“I saw that I had no choice but to close the business down,” he said.

As Jensen started to scale back, he began thinking about the dealer relationships in the United States and Jensen Jarrah’s market niche. The more he thought about it, the more he believed that rather than shutting down he should look for a partner who could produce the company’s designs and support its dealer base.

Jensen began making inquiries. Unable to find a suitable match, it once again seemed that he would have to close the company. Then he met Robert Simeone.

The right match

Simeone started working with the Roda Group’s forestry divisions in the early 1990s. A forester and one of the founders of the Forest Stewardship Council, Simeone helped the Roda Group go through the lengthy — and ground-breaking — process of becoming one of the first FSC-certified forest managers in South America.

The Roda Group has three divisions related to forestry management: ESCR, managing its forests; CIMAL, managing sawmills and kilns; and IMR, manufacturing its wood flooring and furniture.

Although the Roda Group has manufactured furniture under its brand, much of its product was OEM. The company wanted to enter the U.S. outdoor furniture market with its own brand and had been looking for a potential partner. When Simeone, then commercial director for CIMAL/IMR, went to the 2007 Chicago Casual Market, furniture designer Philip Behrens suggested that he meet Jensen.

It took just an hour with Simeone for Jensen to decide to fly to Bolivia as soon as the market ended to see the operation for himself.

“I was very impressed,” Jensen said. “I went home to Australia and prepared a formal business plan to create Jensen Leisure Furniture, which we presented to Francisco Roda [president of CIMAL and IMR] and his board of directors.”

By early spring, Jensen was moving two huge four-headed routers to the IMR plant accompanied by two Jensen Jarrah employees who would spend months setting up the equipment. The first Jensen Leisure outdoor furniture was introduced at the 2008 Premarket in July.

From left, Robert Simeone, liaison between the Roda Group and Jensen; Francisco Roda, president of CIMAL/IMR divisions of the Roda Group; Alejandro Coronado, general manager of Gladymar, the Roda Group’s ceramic tile division; and Hlodver Olafsson, managing director, CIMAL/IMR, the Roda Group.

Jensen had another fortuitous meeting later that summer when he learned that Hlodver Olafsson was available. Olafsson earned his reputation in the outdoor furniture industry by setting up and managing Gloster’s state-of-the-art Indonesian factory. Jensen quickly enticed him to move to Santa Cruz and manage the IMR factory.

Since arriving, Olafsson has made a series of changes to improve the factory’s efficiency and quality control.

“Hlodver has added serious controls and even more attention to detail to our line which really affects our ability to turn product around,” said Jensen.

Olafsson became the division’s managing director in 2009.

Mature and ready

Of the many points that sparked Jensen’s excitement when he heard about the opportunity presented by the Roda Group, first and foremost was its ability to supply 120-year-old, 100% FSC-certified ipe timber.

Bolivia has more than 5 million acres of certified forests, more than any other country. The Roda-managed concesiones, or forest plots, are comprised of more than 300 species. Fewer then 10 of those species account for about 70% of the forest, with the most prevalent being ipe and roble, also known as Bolivian oak. Each concesion is made up of 25 sections. Roda’s ESCR division rotates through each section doing inventories and marking trees for harvest, all part of the independent audit for continued FSC certification. As a result, each section is harvested only every 25 years.

Workers prepare the Opal rectangle dining table for shipment.
Workers on the production floor.

In selecting which trees to cut, Roda Group is very particular, taking fewer than FSC’s allowed minimum and just those that are more than 100-year-old trees. Twenty percent of the trees considered the best of the 100+-year-olds are left as seed producers.

“That is a real advantage for Jensen Leisure’s dealers,” Simeone said. “The quality of our wood won’t diminish over time — unlike what is happening with some of the other hardwoods.”

Because ipe is much denser than jarrah, it can be cut into smaller pieces and be more finely sanded, which is a major plus for Jensen Leisure when it comes to design. Its warm brown color and slightly lower price also have been a hit with dealers and consumers.

Jensen Leisure has exclusive rights to Roda’s ipe in the U.S. market, making it one of the few in the industry to offer 100% FSC-certified wood. The company views this and its complete vertical integration — from forest to distribution of the product — as significant competitive advantages.

Wood for a world of difference

As one of the first forest managers in South America to become certified, the family-owned Roda Group is often cited as a model for others.

“They have really fostered a strong commitment to certification and are always at the forefront pushing things along. And we push them harder than any other company, because they are the leader,” said Rolyn Medina, the chain of custody coordinator for South America, Rainforest Alliance SmartWood Program, Santa Cruz, and the Roda Group’s independent FSC auditor. “If they don’t do it, nobody else will.”

Part of the family’s commitment comes down to the economic advantage of sustainable forest management. In addition to producing top-quality wood, ongoing certification gives companies the stability to invest.

The FSC requires companies to be audited every four years to retain their certification. Bolivia contracts with companies like Roda to manage government-owned forests. Each time the company passes a four-year audit, the government rewards them by extending their management contract by another 45 years, so they end up with long-term rights to the forests, which provides another incentive to invest in them.

But the commitment for the Roda family is also about supporting the indigenous people who make up 70% of its 2,500 direct employees and 9,000 indirect employees which include loggers and others working in the permanent forest camps.

These values dovetail with FSC’s philosophy of sustaining the viability of the environment, the economy and the communities, as well as Max Jensen’s. “Giving people real work is the best way to improve their standard of living,” Jensen said. “Combine that with sustaining lands for production by managing them as fully functioning forests, and you are adding value for the foreseeable future.”

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