UPDATE: Structurlam suspends operations, cuts jobs in Conway after Walmart contract abruptly ends

Structurlam Mass Timber Corp., a Canadian mass timber manufacturer, announced Wednesday (Jan. 18) it is temporarily suspending operations and reducing staff at its 288,000-square-foot Arkansas plant in Conway due to a customer contract cancellation with Bentonville-based Walmart Inc.

“Decisions like this are never easy, especially when they impact our people,” Matthew Karmel, CEO of Structurlam, said in a news release. The company said the move impacts 144 jobs.

In the release, the company did not initially name the customer. In response to a question from Talk Business & Politics, a spokesman confirmed that Walmart canceled the lucrative contract.

However, a Walmart spokeswoman said Structurlam’s claim that the retailer was responsible for the partnership ending “would not be accurate” and offered the following statement.

“Walmart was informed today by Structurlam’s CEO that they suspended operations of their mass timber factory in Conway, AR. While this is a disappointing outcome that impacts many parties, we are proud of the significant financial and operational support Walmart has provided Structurlam since 2019. Walmart remains excited about using mass timber on our new Home Office campus and will continue to seek alternate sources of mass timber for the project. We will use as much material from our home state of Arkansas as feasible.”

In December 2019, Structurlam announced a $90 million investment in the Conway facility largely to support one project — the construction of the new Walmart corporate campus in Bentonville, which was first announced in 2017.

Officials with Structurlam, based in Penticton, British Columbia, Canada, made the announcement with Gov. Asa Hutchinson and Dan Bartlett, executive vice president of Walmart Corporate Affairs. The new facility was expected to create 130 jobs in a facility once operated by Nucor.

“We are excited about the technology and the additional opportunities for growth Structurlam brings with it to Arkansas,” Hutchinson said at the time. “The company’s partnership with Walmart is an example of how this expansion will benefit our state’s timber industry.”

The world’s largest retailer had planned to use more than 1.1 million cubic feet of Arkansas-grown and Arkansas-produced mass timber in its new home office campus in Bentonville, making it the largest campus project in the U.S. using mass timber.

“Structurlam is uniquely positioned to deliver its innovative approach to digital design collaboration and mass timber manufacturing to Walmart and the State of Arkansas.” Bartlett said during the December 2019 news conference. “With their help, we are able to realize our goal of connecting our associates with nature and the beauty of Arkansas through our new Home Office project.”

Karmel has headed up the company for less than a year.  Hardy Wentzel, the previous CEO, told the Northwest Arkansas Business Journal in 2020 that the new Walmart corporate campus is far and away the largest project Structurlam has supplied.

“We’ve done a lot of large projects with some other iconic [companies],” he said. “In Silicon Valley, we are very active with some tech sector companies [that] have similar desires about sustainability and desires to build faster and build a great place for people to come work. But this [Walmart] project, by many factors, will be the largest mass timber project for a while. Probably globally.”

According to Structurlam, an economic benefit of mass timber is the ability to design, model and prefabricate the structural elements of a project offsite, accelerating on-site production schedules by up to 25% compared to traditional onsite building with steel and concrete.

Structurlam is the first manufacturer to bring mass timber to the North American market.

Karmel explained that since the company is no longer constrained by its exclusive production agreement with Walmart, it now has the ability to support new customers with more than 1 million cubic feet annually of Glulam and CLT mass-timber products.

“To put this into context, the state-of-the-art Conway plant has a capacity sufficient to construct a 200,000-square-foot office building every two months,” he added. “We continue to work diligently to identify new solutions for putting this facility to good use, as it represents an important step in our North American growth strategy.

“We appreciate the support of the Conway community and state and regional business partners, and we look forward to continuing to remain a vibrant part of this growing economy,” Karmel said.

Plant Manager Jody Doak added, “We are grateful for the contributions and hard work of the Conway employees, and we anticipate the prospect of welcoming them back with new customer projects.”

Conway Area Chamber of Commerce President and CEO Brad Lacy said news of the Structurlam plant closure was unexpected.

“As with any layoff or closure, our main priority will be the impacted employees and getting them back to work as quickly as possible,” he said.