Unpredictable
fuel costs and the necessity of keeping warm in
the
winter have resulted in "boom sales" for manufactures of
wood-burning
stoves. There has also been a return to the use
of
the fireplace as a form of supplementary heat and as a
luxury
that promotes the "cozy" atmosphere sought after by
both
middle class and affluent families. This renaissance in
the
popularity of wood heat, and upward spiraling sales of
associated
equipment, has created a demand for firewood that's
almost
impossible to fulfill.
A
very important element: This demand has caused the price of
firewood
to almost double over the past several years.
Whatever
the "going price" for a cord of firewood in your
area,
you can expect it to increase by 20 to 30 percent each
year
for the next ten years or so.
Your
potential market is a varied as the weather; it is also
somewhat
dependent on the weather. You'll find buyers among
apartment
dwellers as well as home owners. The rich buying
firewood
perhaps more than the poor; those concerned with
the
purity of the environment and the so-called "voluntary-
simplicity"
folk seeking a return to the "pioneering" life
are
all part of your market.
And
don't think for a minute that firewood sales are limited
to
the colder northern states. people living in Sunny
Southern
California and along the Gulf of Mexico buy and
burn
firewood for the same reasons as people living in
Minnesota
and Montana.
One
of the secrets of success in this business is understanding
why
the people in your area burn firewood. Then it's a matter
of
learning when and how often they need it, and positioning
yourself
to fill those needs.
It
doesn't take special education or training to become
successful
firewood supplier. Just for the record, the
backgrounds
of people operating businesses of this kind
range
from farmers to unemployed factory workers to
doctors,
lawyers, real estate salesman and even university
professors.
The
kind of equipment you'll need varies according to the
type
of business you want to establish, and the kind of wood
you
will be supplying.
The
first prerequisite to the establishment of your business
is
to decide what kind of business---wholesale to retail
outlets,
or retail to the general public--you want to operate.
Next,
you'll have to decide on the type of firewood you will
sell.
There are three major categories: 1) mill ends or sawed
up
scrap lumber and kindling, 2) whole logs for the buyer to
cut
according to his own specifications, 3) fireplace and
stove
wood, cut and split according to the general requirements
of
your market area.
Your
next step is to line up a source of supply. Actually, it's
best
to "lock in" a number of sources of supply. Later on, as
your
business develops and grows, you may want to offer several
different
kinds of firewood, that is, become a full-service
dealer
offering firewood to meet everyone's needs and fancies
for
your area. We'll discuss different categories of wood and
demand,
so that you can explore sources of supply and costs.
MILL
ENDS: Your best source of supply for this type of wood is
the
sawmills in your area. If you live in a metropolitan area,
take
a few weekend trips to the small towns in the wooded areas
of
your state. With a little bit of initiative on your part,
you
should be able to discover any number of small sawmill
operations
within a 200-mile radius most metropolitan areas
in
this country.
What
you'll want to do is buy a truckload of mill ends, take
them
home and package them into sacks of firewood. Thus, a
load
of mill ends that you might buy for $50 would be broken
down
into perhaps 200 sackfuls that you sell for $5 per sack.
Multiply
these 200 sacks of firewood times $5 each, and you
have
a gross income of $1,000 for a load of wood costing you
only
$50. You wouldn't have to be very smart to realize that's
pretty
good, providing your sources of supply can keeps us
with
the demand.
The
beauty of mill ends is that they are clean, burn down into
sackfuls
are fast, put out a lot of heat, and when broken down
into
sackfuls are ideal for apartment dwellers, as well as
people
in warmer climates needing firewood for just a few cold
spells
each winter. Until you have a large full-service
firewood
supply operation, it's suggested that you leave the
sale
of truckload supplies of mill ends to the larger, more
established
firewood suppliers. My advice here is that you
should
stay within the capabilities of supplying the buying
demands
of your market, and further concentrate on selling
what
brings you the greatest profit. However, as your
operation
grows, the supply of truckloads of mill end
firewood
is definitely worth considering.
Other
sources of supply for mill end will be your local
lumbar
yards, woodworking or furniture manufacturing firms,
and
home building or remodeling contractors. in many instances,
you
can offer to stop by these places about once a week and
clean
up the worksite by hauling away the scrap lumbar, and
they'll
let you have it without cost. It is possible to even
get
paid for doing this. The only drawback will be that you'll
have
to sort this wood, and then saw it up into the sizes you
want
for your bundles or sacks. This is no big deal, because
you
can handle a pickup ot trailer load with a power saw in
just
a couple of hours.
When
you have the wood ready to package into sacks, you'll
save
time and increase your profits by hiring a couple of
high
school, explain that you need a couple of students for
part
time work sacking firewood, and you'll have all the
help
you need.
As
for how much to pay them, establish a pay rate for 100
full
sacks. Of two high school students, one would hold open
a
sack while the other uses a scoop shovel to pick up the
wood
and dump it into the sack. Between them, they can gather
the
top of the sack and ti it with twine. The full sacks,
of
course, must be stacked on a pallet or in a area ready
for
selling. Check the time it takes two good students,
working
at a reasonably fast clip, to load 100 sacks.
Knowing
the current minimum hourly wage rate, you can then
determine
the labor value of 100 loaded sacks.
For
a supply of burlap bags for use in sacking wood, check
with
a farmer's feed store. If you buy in quantity, you can
get
them at a very reasonable price. You can purchase twine
for
tying the sacks at the same place.
WHOLE
LOGS: Many people have chain saws and fancy themselves
as
"do-it-yourselfs," but they don't have the time to go out
into
the woods and bring back firewood. If you can supply
these
people with a location not too far from home, where
they
can saw and split their own firewood, you'll have a
steady
stream of customers. You'll need a large vacant lot--
about
a half acre to a full acre---and preferably on the
outskirts
of town. The first thing will be to put up a
6-foot
cyclone fence around your lot, and then a small
garden
shed type building to serve as your office.
Contact
a sawmill or logging operation not too far from
where
you want to open your business. Arrange with them
to
deliver whole logs (lumbar rejects) to your wood lot.
Your
costs shouldn't run much more than $10 per log,
even
for premium wood, but will depend upon the size
and
number delivered in each load.
If
you have the vehicle and the energy, you can also
contact
the Forest Service or the Bureau of Land
Management
in your area for a permit to cut firewood
in
government preservation area. Then you go out into
the
woods, saw up downed trees into eight-foot lengths,
load
them into your vehicle and haul them to your woodlot.
Still
another source of supply is the farmers in your
area.
Talk with them and offer to "thin out" area of
standing
timber, and the downed trees. Oftentimes, you
can
get this wood at no cost other than offering the land
owner
sa share of the timber you take out. He may even
consider
your "thinning" and hauling an even exchange
for
logs.
Don't
forget about the road building construction
companies,
and commercial and residential developers as
sources
of supply. Actually, once you get into the business
you'll
find sources of supply virtually unlimited, and
restricted
only by your initiative in making contact with
the
property owners.
once
you have a supply of logs within your wood lot, there
are
many things you can do to attract customers. Run an
advertisement
in your local paper inviting "do-it-yourselfers"
to
come out and cut their own firewood. You charge them
twice
as much per log as your cost, and they do the sawing,
the
splitting, the loading and provide their own car or
truck
to take them home. You are only to supervise and
receive
payment.
You
could also rent chain saws, axes and the use of your
power
splitter. Allow the customer to select the log of his
choice,
and then have the hired help--high school students,
perhaps--who
would saw, split and load this wood into the
buyer's
vehicle. The ultimate, of course, would be be
include
delivery and stacking of this wood at the customer's
residence.
Once
the customer has selected his log--at twice your
costs--and
pays you $5 for sawing it into the lengths he
wants,
plus $10 for splitting it for him and another $10
for
loading it onto his vehicle, you're talking about $150
to
$200 per cord of wood. The secret here is to have your
helpers
working in teams, with the kind of efficiency that
means
$100 per hour for you.
FIREPLACE
AND STOVE WOOD: In running a program of pre-cut
and
split fireplace and stove wood, you combine all the
principles
we've discussed so far, into either a wholesale
or
retail firewood supply sales outlet.
The
easiest and most profitable operating procedure is to
set
up a wood lot where whole logs are delivered to your
location.
Part-time workers saw these logs into 16 to 24
lengths
for you. A couple of people with chain saws should
be
able to cut two cords of wood per hour. A couple of
people
working a power log splitter should be able to keep
up
with the people on chain saws. And a couple of other
people
stacking this wood onto pallets as it's split, or
for
storage until sold, would be all the help your need.
If
you can set your business up along these lines, you'll
realize
the greatest profits and not have to get involved
in
the physical part of the business. The big thing to
remember
is that--as the business owner and operator---
your
time should be devoted to selling the end product.
If
you decide to be a wholesale supplier, and sell to
retailers,
advertise for and hire commission sales people
to
call on the retail outlets in your area. You'll need
help
in covering all the possible opportunities for retail
sales
of your firewood.
You
should be selling sacks and pallet loads of firewood.
remember:
The more you can divide a basic cord of firewood
into
sacks or pallet loads, the greater profit you're going
to
make from each cord of wood you sell.
You'll
find most people buying cords or truckload quantities
of
firewood before cold weather sets in, and after that,
people
will buy in quantities only large enough to get by,
or
to last out a sudden cold public, after setting up retail
sales
outlets, be sure that your prices at least "average"
those
being charged by the retail sellers. Never "undercut"
the
price your retail people are charging.
If
you decide to do all the selling yourself--in other words,
act
as your own retail outlet--you'll need to advertise.
Start
out with a large three-column wide, by four-inch deep
display
ad in your local paper. Unless you've had advertising
experience,
at least contact the advertising instruction
class
at your local community college for help in layout and
writing
of this ad. If you're not far from a large
metropolitan
area, you can often contact the advertising
agencies
in that area, and get freelance help to assist in
the
makeup of your advertising.
Plan
the appearances of this ads for a saturday morning paper.
Make
your opening a big event--much as the same as a grand
opening
or special anniversary sale--with free coffee, donuts
and
balloons for the children. Ideally, the opening of this
kind
of business should be staged on a weekend in late
September
or early October, and designed to acquaint the
people
in your area with your firewood business.
Get
the name, address and phone number of everyone who shows
up.
This can be handled very unobtrusively by giving away
free
prizes requiring the attendees to your event to fill
out
simple prize drawing forms. The prizes can be a free
cord
of wood, dinner for two at a local restaurant, or even
movie
passes.
The
whole purpose of your grand opening show is to let
people
know that you're open to serve their needs; to get
them
to discover your location; and to implant in their
minds
the memory that you can supply them with the means
to
keep warm when the weather turns cold.
Quite
naturally, many will find your services to be more
convenient,
time-saving and less bother that whatever methods
they're
currently using. As you talk with your customers,
listen
to their "complaints" about their present methods of
firewood
procurement, and then alleviate those problems with
the
services you provide.
After
your grand opening, a small 2 by 4 inches display ad
in
the yellow pages of your telephone directory plus the
posting
of advertising circulars and business cards left
with
woodstove and fireplace suppliers, insulation and
remodeling
contractors and lumbar yards in you area is
about
all the advertising you'll need to do. However, it
would
be wise to follow the lead of the "snow tire" people,
and
whenever the weather forecast shows a cold front or
winter
storm moving in, invest some money in radio and
newspaper
advertising.
Statistics
prove that 20 percent of your potential market
will
prepare for cold weather by purchasing before the cold
weather
sets in. Another 30 percent of the market will wait
until
the first cold snap hits, then buy from the first
supplier
that comes to mind. Finally, the remaining people
will
have to be "sold" via suggestion of the benefits your
business
provides.
This
is the period when you begin profiting from those names,
addresses
and telephone numbers of the people who turned out
to
your big opening event. Simply set up a telephone selling
program
utilizing the services of commission telephone sales
people,
and follow up on those who had registered.
You
can conceivably operate this business from your home or
backyard,
and definitely on a part-time basis, but their
prospects
of immediate success, with outstanding profits
are
so great that it would be wise to plan on a big
operation
from the start.
A
receipt pad for taking orders, a "daily diary" or ledger
type
of bookkeeping system, a calculator and a telephone
should
suffice for office supplies and equipment. Until
you're
over the hump on the profit side, you can keep your
sales
receipts in a shoebox or daily staple together and
store
in chronological order.
A
couple of other points remember: Hardwood burns the
longest
and gives off the most heat; firewood that has
been
cut in the spring and seasoned through the summer
is
the kind most people will be willing to pay premium
prices
for; and giving the customers a "little extra" for
his
money will result in greater and longer lasting success
than
quick profit schemes.
Once
you've got your basis firewood supply business on a
profitable
basis and running smoothly, you'll find your
facilities
and business expertise ideally suited to adding
extra
profit producing lines such as the sale of firewood
accessories,
woodstoves, built-in fireplaces, home
insulation
or weathering services, recycling and perhaps
even
home remodeling.
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