Cooperation Yields Marketing Success in Oregon
Words from the Woods
Third in a Series By Mary Vasse

When Anne and Richard Hanschu were given the Western Tree Farmer of the Year award in 2000, it was recognition of two generations of excellent land management. But good land management is not the only thing that supports their success.
The Little Beaver Creek Tree Farm has been a part of the Oregon Woodland Management and Sales Cooperative since Anne's father, Byron Doneen, helped get it started 22 years ago.

Today the cooperative's 36 forest landowner members represent eight Northwest Oregon counties. Together they have completed 86 harvests, a total lifetime harvest of nearly 10.5 million board feet worth nearly $5 million. What makes the cooperative even more remarkable is that after providing profitable services for over two decades, it is still the only forest landowners cooperative in Oregon. Byron "Barney" Doneen started with 212 acres in Washington County. As a landowner and an economist, he recognized how difficult it can be to market one's own forest products and get a fair price. The founding families' main goal was to have a stronger presence in the market.

"Barney felt that, as a formal organization, small private forest owners could be represented as a group and thus able to market their forest products for maximum returns," says Anne Hanschu. Their second goal was to retain a highly competent forest consultant to coordinate harvests, marketing and sales.

When the cooperative was launched in January 1981, its members represented 7,200 acres. Continuing in Barney Doneen's footsteps, his daughter Anne and her husband Richard remain very involved. Anne Hanschu is now the cooperative's Secretary. Richard Hanschu is Chairman.

A cooperative is a business. Members receive the services the cooperative provides at a reduced rate. The cooperative business model works especially well for groups of businesses that have something in common to sell, like commodity forest products. While members can take advantage of joint marketing opportunities they do not have to do business through the cooperative.

"The concept of landowner cooperation holds tremendous promise," says E.G. Nadeau, coauthor of the Handbook Balancing Ecology and Economy: A Start-up Guide for Forest Owner Cooperation. "People working together create a synergy landowners sharing solutions, pooling resources, hiring expertise, developing markets, and accomplishing work that might be impossible alone."

As the cooperative's first and only forester, Dick Courter knows a great deal about the members tree farms and their market potential when it is time to Anne and Richard Hanschu, Cooperative Members harvest.

"Dick is representing over a million board feet a year - a block of timber," says Richard. -He can get a better value for the products we have by marketing them as a group. He also has monthly contact with these buyers. Some of our members may only have contact with buyers once every 10 years.

The cooperative's continuity has been instrumental in helping member families transfer knowledge about their lands to younger family members. This was true for Anne and Richard, who took over operations from Anne's father in 1991. "With Dick's help," the Hanschus say, "we never skipped a year of logging." Drawing on his 26 years as a consulting forester, Dick thinks the cooperative model may prove even more of a benefit when the economy is down. "When the economics get tight I think they work the best."

Always looking for market advantages, Dick Courter sees another advantage in growing the cooperative. "I want to eventually have one or more sort yards so that each log goes to the absolutely best market." While he acknowledges the infrastructure for a sort yard would be expensive, it may be this next step that helps small landowners gain an advantage in uncertain market conditions.

Anne and Her Father Byron Doneen at the Little Beaver Creek Tree Farm

The reason? "There are fewer mills on the horizon in a poor economy, so there is less competition. The small landowner is pressured to accept less for logs due to a limited number of buyers." The cooperative is now marketing around 1 million board feet each year. Their next challenge is to increase membership so they have a larger and more consistent volume of timber to offer mills. The cooperative is chartered to operate statewide. But while all agree they need to increase membership, they don’t have a "magic number" in mind. Always looking for market advantages, Dick Courter sees another advantage in growing the cooperative. "I want to eventually have one or more sort yards so that each log goes to the absolutely best market." While he acknowledges the infrastructure for a sort yard would be expensive, it may be this next step that helps small landowners gain an advantage in uncertain market conditions.

The Oregon Small Woodlands Association is currently exploring creation of a network of forest landowner cooperatives. This is old territory for OSWA, which supported the Oregon Management and Sales Cooperative when it started in 1981 by polling its statewide membership to gauge interest.

Anne Hanschu remembers, "Many of those interested were in Washington County, but there was also interest in other parts of the state." Dick Courter has also been thinking about the possibility of making the cooperative model work on a larger scale, saying, "There isn't any reason why we couldn't operate statewide."

Richard has this advice for those thinking about starting a cooperative. "You have to bang your head against the wall until you find something that will work for as many people as possible." For the members of the Oregon Woodland Management and Sales Cooperative, the hard work has been paying off.