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Competition heats up in the valley of the sun: Phoenix''s hot housing market draws national cabinet manufacturers to Oak Craft Inc.''s home turf.

Article Excerpt
Never mind the blistering summer heat. Year-round sunshine, more golf courses than a duffer can shake a full set of irons at and relatively cheap land prices have contributed to the greater Phoenix area's housing boom.

Oak Craft Inc. of suburban Peoria, AZ, is one of the hometown cabinet companies to capitalize on the area's latest development spurt. Year after year throughout the 1990s the company racked up new sales records and in the process regularly earned a place in Wood & Wood Products' annual WOOD 100 Report of fast growing woodworking firms. Oak Craft's sales increased six-fold between 1990 and 2000, from $2.6 million to $17 million.

In recent years, the same strong home building market that propelled Oak Craft's growth has served as a beacon to attract competition from national cabinet manufacturers, says Greg Johnson, marketing director of Oak Craft. "It seems like every one of the industry's top 50 cabinetmakers has jumped in here and boosted their presence. Some have expanded their warehouses serving this market but not many have made a true commitment to the area."

"We saw this same pattern in the mid-1980s," Johnson says. "They're almost like raiders. They'll stay as long as the growth period lasts and then they'll pull out."

Regardless of what the majors do, Oak Craft managers have to operate with the knowledge that pricing is more sensitive than ever and that their company has to rise above the standard product offerings if it is to garner its share of business.

Big-Name Competition

Oak Craft has pursued a multi-pronged strategy to compete against much bigger national cabinet manufacturers. It includes implementing a lean manufacturing program to lower production costs, speed delivery and improve quality. Other components of Oak Craft's defense strategy include offering more custom options, perfecting product finishes and working harder to maintain close relations with its approximately 25 dealers.

"Builders...

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