The Pencil Mill Dumped Cedar Slat Scrap on Her Line for 12 Years — She Built a $250,000 Closet Brand

The Pencil Mill Dumped Cedar Slat Scrap on Her Line for 12 Years — She Built a $250,000 Closet Brand

Chapter 2

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Lana's idea was to line closets with it. Not the whole closet, not the walls and floor and ceiling in some elaborate renovation, but modular cedar lining panels. Tongue and groove slat systems cut to standard closet dimensions. Sold directly to homeowners as a premium closet upgrade that could be installed in an afternoon without a contractor, without tools beyond a mallet and a tape measure and without any raw material cost beyond what it took to mill the scrap into uniform panels. The material was free.

The mill was paying to get rid of it. The market was every homeowner in America who owned a wool coat and had ever found a moth hole in it. She had the unit economics written out in her notebook in pencil revised four times at a retail price of $180 for a standard reach-in closet kit with material cost near zero and labor cost limited to milling and packaging. Her projected margin was 71%. She had field trial data from a study published by Kansas State University's extension service in 2004 showing that cedar-lined enclosures reduced moth larvae populations by 94% compared to unlined enclosures.

She had a survey she'd conducted herself by calling 200 homeowners in Dane and Sauk counties and asking whether they'd experienced moth damage in the past 3 years. Sixty-eight percent said yes. She then asked whether they'd be willing to pay $150 to $200 for a closet lining that prevented it. Sixty-one percent of those said yes. She showed her father the notebook.

He read it the way he read everything. Slowly, without expression, turning each page with the same deliberate care he used for everything. When he finished, he closed the notebook and set it on the table and looked at her. He said, "You can use the old equipment shed. Don't let it interfere with haying season."

That was his yes. That was all the yes she got and it was enough. Let me tell you about the moment the story almost ended before it started. Because without that moment, you don't understand why the rest of it mattered. In the spring of 2008, Lana had spent 7 months converting the equipment shed into a small milling operation.

She bought a used table saw for $400 at an estate sale, built a router table herself from plans she found in a woodworking magazine, and borrowed a sander from a neighbor that she never quite returned. She had milled her first 200 panels from cedar scrap she'd hauled herself from the back of the Muning Mill property. The wood had been sitting in piles being rained on, and she had assembled her first 12 closet kits, packed them in cardboard boxes she'd sourced from a recycler in Madison, and driven them to three independent kitchen and bath showrooms in Sauk County and Dane County to ask if they'd carry them on consignment.

Two of the three showrooms said no. The third, a place in Prairie du Sac called Heirloom Home, said they'd put two kits on the floor and see what happened. Both sold within 3 weeks. Heirloom Home called and asked for eight more. Lana milled them, delivered them, and used the $360 in proceeds to buy a better router bit and a box of business cards.

That was when she drove to the Muning Mill to ask if she could formalize an arrangement, a regular supply of cedar slat scrap in exchange for hauling it away at no cost to the mill, which would save them the disposal fees they were currently paying. She had a one-page proposal. She had practiced what she was going to say. She had her notebook. The mill manager was a man named Chuck Severt.

Chuck Severt had managed the Muning Mill for 19 years and had the particular confidence of a man who had never been surprised by anything in his professional life and intended to keep it that way. He was in his mid-50s with a gray mustache and the kind of handshake that was slightly too firm in a way that was meant to tell you something. He read Lana's one-page proposal with the expression of a man reading a menu in a language he doesn't speak. And when he finished, he set it down on his desk and looked at her over the top of it.

He said, "You want me to give you my scrap wood so you can sell it back to people as a closet product?" Lana said yes. That was the idea, and the arrangement would save him approximately $4,000 per year in disposal costs. Chuck Severt leaned back in his chair. He looked at the ceiling for a moment.

Then he looked back at her and he smiled. It was not a warm smile, but the kind of smile that's really a different kind of dismissal. The kind that says, "I'm being patient with you because I'm a reasonable man and not because I think you have a point."

He said, "I appreciate the creativity. I really do. But I've got three guys who want that scrap for firewood, and they haul it for free. I'm not going to complicate my operation for a college project."

He said college project. Lana was 21 years old and had been out of college for a year. She did not correct him. She drove home on County Road C with her hands at 10 and 2 and her jaw set and she pulled into the farm and sat in the truck for a few minutes before she went inside. Her father was in the barn.

Her mother was at the kitchen table with a book. Lana sat down across from her and told her what had happened. All of it, including the part about college project. And when she finished, her mother closed her book and looked at her for a moment and said, "So, you'll use what's already on the property line." There were at that point approximately 2 tons of cedar slat scrap sitting on or near the Vandermir property line from previous dump runs.

Lana had not yet processed it because she'd been waiting to secure a formal supply arrangement. Her mother's point was that she didn't need one. She had the wood. She had the shed. She had the saw and the router and the sander.

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The Pencil Mill Dumped Cedar Slat Scrap on Her Line for 12 Years — She Built a $250,000 Closet Brand

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