Exporting the American lifestyle
An Auburn home-building company is serving a niche market in Japan. Its customers want an American look, complete with couches and cookies.
[SOUTH SOUND Edition]
The News Tribune - Tacoma, Wash.
Author: KELLY KEARSLEY
Date: Jun 12, 2005
Start Page: D.01
Section: Business
Document Types: News
Text Word Count: 1147
 Document Text
Copyright The McClatchy Company Jun 12, 2005

You can't get more American than chocolate chip cookies.

So when Tod Sakai designed brochures that his company, Auburn- based Armstrong Homes, uses to market high-end, prefabricated homes in Japan, he featured photos of a mother smiling as her daughter stirs a bowl of cookie dough.

The next image is a Post-it note reading - in Japanese - "Honey, I've taken Hannah to piano lessons. We'll be home soon. The kids and I made cookies! Help yourself!"

The pages of the advertisement even smell like cookies, thanks to special cookie-scented paper.

The company isn't targeting hungry home buyers. Instead it's after a niche market of Japanese consumers who long for an authentic American home - right down to the barbecue on the

deck and the couch in the living room.

Armstrong exports 50 to 80 of these houses - many complete with American furniture and decorations - each year to Japan.

"They see the American lifestyle on movies and television," said Sakai, general manager at Armstrong. "It's very appealing, just like it's appealing to everyone else here."

What started as a lumber yard in 1952 now has grown to a multimillion-dollar company that does about 20 percent of its business overseas. In addition to homes, the company also exports component packages such as doors and mill work.

Armstrong's custom homes are made at its factory and shipped in massive pieces to the construction site. Instead of a lumber company delivering a load of wood to a job site, Armstrong offers premade wall panels with the siding, windows and trim already installed, ready-to-go roof trusses and finished doors.

For contractors in the United States, the off-site construction saves them time in building the home and money in products they might have normally wasted, such as extra lumber that they didn't need, Sakai said. Builders can construct an Armstrong house in less than 80 days - with the actual framing finished in a week - compared to the six months it can take for traditional construction.

"We tell them that we are going to give them tools to boost their bottom line," Sakai said.

Cost-effective, but costly

In Japan - Armstrong's main international market - the speed at which the homes go up is appealing. But the fact they are American inside and out is the draw.

Terry Cox, a Canadian living in Yokohama, and his wife, Hiroe Kimura, operate an English-language school out of an Armstrong home in an upscale neighborhood. The couple considered several Japanese contractors but decided on importing an Armstrong house because it was more cost-effective and had the feel they wanted.

Cost-effective doesn't mean cheap. Armstrong homes cost Japanese customers an average of $200 per square foot, making a 2,000-square- foot home about $400,000. Stateside, customers spend closer to $100 to $150 per square foot, or $200,000 to $300,000 for the same size house.

"We really wanted the North American concept . . . everything down to the furniture was done through Armstrong," Cox said. "A lot of our teachers are from North America or Canada, and they say they feel like they are at home. A lot of our students who have lived overseas say the same thing."

Cox traveled to Seattle and spent three days shopping for furniture for the house. It's a trip that Armstrong helps arrange and one about half of their Japanese customers make.

"It all adds to the American theme," Sakai said.

The company works with several local furniture stores, including Macy's and Levitz. The furniture is packed in a shipping container with the rest of the house - less expensive than shipping it on its own.

Customers too strapped for time or money to make the trip can buy most of the furniture and other home decor off Armstrong's Web site.

a growing Japanese market

While the Auburn company might be filling a niche market in Japan, exporting housing and building products to the Asian country are a key part of Washington's economy. More than 150 local companies do so, sending everything from entire homes to windows and doors.

Washington exports more than 50 percent of the total wooden building materials to Japan, according to the state's Department of Community Trade and Economic Development.

"Japan tends to be the major market, and it's the most developed market for most of these companies," said Larry Kvidera, program manager of Evergreen Building Products Association, a Tacoma-based organization that promotes the export of building products. "A big part is our location - with our access to a very good port system - and the nature of the types of products."

The businesses had a heyday in the mid-1990s as Japan's housing market boomed. The 1995 Kobe earthquake also generated more interest in American two-by-four construction, which many consider stronger than the traditional post-and-beam construction style used by most Japanese builders.

While the country's recent economic slump has put a damper on the number of new housing starts in Japan over the past few years, imported homes as a percentage of those starts has continued to grow, Kvidera said. The homes make up 1 percent of the new housing starts, versus the less than 0.1 percent the homes accounted for 10 years ago.

Kvidera's association attributes the growth to consumer demand for efficient homes with attractive designs and layout.

A house in Yokohama

At Armstrong, Sakai anticipates international sales will remain at least 20 percent of the company's business and possibly grow. The company has 43 "dealerships" - contractors certified to build its homes - in Japan.

Armstrong opened a model home in April amid the skyscrapers of Yokohama, Japan's second-largest city and a prime market for custom- home buyers. The house is in a custom-home park. Sakai wants the Armstrong home to stick in the potential buyers' mind. He's asked that the staff in the house keep a batch of chocolate chip cookies baking in the oven to be sure that it does.

- - -

Kelly Kearsley: 253-597-8573

kelly.kearsley@thenewstribune.com

Company profile

Name: Armstrong Lumber Co., also known as Armstrong Homes

Headquarters: Auburn

Business: Construction of prefabricated, custom homes for domestic and international customers; also offers component packages for homes, such as doors and mill work.

Sales: $10 million-$12 million per year, with international sales representing about 20 percent of the business

Employees: 85

Founded: 1952

Web site: www.Armsystem.net

[Illustration]
Caption: COLOR PHOTO / Janet Jensen/The News Tribune: Dennis Michel, left, stains baseboard as Doug Dung carries the finished product last week at Armstrong Homes in Auburn. Armstrong sells prefabricated homes with wood custom-stained to match furniture and light fixtures that all get shipped together to be assembled in Japan. COLOR PHOTO / ARMSTRONG CUSTOM HOMES: Advertising materials detail features of the American-built homes and promise Japanese customers an American kitchen with the ambience of a cafe. COLOR PHOTO: Sakai; Credit: Janet Jensen/The News Tribune

Credit: The News Tribune

 Abstract (Document Summary)

[Armstrong]'s custom homes are made at its factory and shipped in massive pieces to the construction site. Instead of a lumber company delivering a load of wood to a job site, Armstrong offers premade wall panels with the siding, windows and trim already installed, ready-to-go roof trusses and finished doors.

Armstrong opened a model home in April amid the skyscrapers of Yokohama, Japan's second-largest city and a prime market for custom- home buyers. The house is in a custom-home park. [Tod Sakai] wants the Armstrong home to stick in the potential buyers' mind. He's asked that the staff in the house keep a batch of chocolate chip cookies baking in the oven to be sure that it does.

COLOR PHOTO / Janet Jensen/The News Tribune: Dennis Michel, left, stains baseboard as Doug Dung carries the finished product last week at Armstrong Homes in Auburn. Armstrong sells prefabricated homes with wood custom-stained to match furniture and light fixtures that all get shipped together to be assembled in Japan. COLOR PHOTO / ARMSTRONG CUSTOM HOMES: Advertising materials detail features of the American-built homes and promise Japanese customers an American kitchen with the ambience of a cafe. COLOR Sakai; Credit: Janet Jensen/The News Tribune