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Author Topic: 14 questions for Starting a firewood business  (Read 9037 times)

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Offline Frank T

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14 questions for Starting a firewood business
« on: October 20, 2014, 09:20:12 PM »
Has anyone really looked at the costs associated with having a firewood business and figure out the profitability? Ive been thinking about getting into it with my teen-age boys part time so Id be interested to hear:
1. How much do you sell a cord of wood in your area
2. What do you pay yourself per cord
3. What you pay your workers cord
4. How much do you spend on expenses per season (gas, repairs, equipment, injuries etc).
5. How much time does it take to process 1 cord of wood vs 10 cords vs 50 cords.
6. How many cords of wood do you process per season
7. How much help do you have processing this number of cords per season
8. Do you get all your un-split wood for free?
9. How much do you pay for un-split wood if you have to buy it?
10. Where do you make your largest profits (small bundles, large truck loads, green wood, dry aged wood, specific wood species, pick up only, delivery charges, stacking charges, special order lengths/sizes)
11. Besides a standard chainsaw, pick-up truck, a splitter and an ad on craigslist: what other items would you recommend to speed up the process or make more money selling firewood? (front end loader, trailer, dump bed on truck, a hot delivery girl)
12. Part timers: Do you have a registered business or are you cash only?
13. Full timers: How many folks do you have working for you and how long have you been in business
14. Are there any UP-SELL opportunities you stumbled on outside firewood (lawn maintenance, small home repairs, chimney cleaning, general hauling, selling mulch, etc).


Thanks
Frank T

Offline redprospector

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Re: 14 questions for Starting a firewood business
« Reply #1 on: October 20, 2014, 10:34:40 PM »
Frank, you forgot one question.

15. What the heck was I thinking?  :D

But that usually comes a little later.  ;)
1996 Timber King B-20 with 14' extension, Morgan Mini Scragg Mill, Fastline Band Scragg Mill (project), 1973 JD 440-b skidder, 2008 Bobcat T-320 with buckets, grapple, auger, Tushogg mulching head, etc., 2006 Fecon FTX-90L with Bull Hog 74SS head, 1994 Vermeer 1250 BC Chipper. A bunch of chainsaws.

Offline Leigh Family Farm

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Re: 14 questions for Starting a firewood business
« Reply #2 on: October 21, 2014, 12:17:59 PM »
Frank,
I would advise you to run a search on the forum and you will get a lot of threads that answer all of your questions. I don't run a firewood business but I do run a part time at home business (making madelienes) with my wife so take the following as you see fit.

1. Every area of the country is different on pricing of cords. I personally wouldn't worry about the price in the beginning. figure out your costs first as they tend to determine your pricing.
2 -3. How much do you want to make per hour? $15? $20? $10? Then with a simple calculation you can figure out how many cords you can produce in an hour and divide that by your required hourly rate.
4-10. Expenses can vary greatly depending on what equipment you have on hand. A large processor is going to require more maintenance than a small splitter. Producing 10 cords of wood will use less gas than 50 cords. You get the picture. I would start with getting your sons together and seeing how much wood you can process in an hour. After your done, look at how much gas you used. Don't try to rush through this..it's not about speed but about consistency. So lets say you produced 2 full cords of wood in an hour, you paid everyone $10/hour, and you used 2 gallons of gas. That would be $30 in labor, $8.00 in gas, and lets say $2.00 in maintenance costs. You have $40 in expenses for the hour or $20 per cord of wood. This doesn't take into account other costs like purchasing wood, bundling, delivery, seasoning, etc.
11. As you add equipment to make your operation more efficient, your expenses will go up. Just make sure that the nice dump trailer you buy doesn't actually cost you money to operate in the end.
12. You're in PA, just like me. It will cost you a few hundred dollars to form an LLC. Do it. Especially if you are delivering the firewood, because the last thing you want is a customer coming after you for ruining their lawn or breaking some fence (whether you did or not) and now they can go after your personal assets as well.
13. N/A for me to answer.
14. If you are observant, there are always opportunities to make an extra buck. You will see from reading on the forum that a lot of the very successful people stopped looking for the extra buck opportunities and just focused on providing one quality product/service and referring customers to those that provide the other services they are looking for. Again, there is a lot of threads that talk about this. Don't try to over extend yourself.

I hope this information is helpful to you. A firewood business might be a great opportunity for you and your sons to make some extra money while spending time together. I wish all the luck and good fortune as you move forward.
There are no problems; only solutions we haven't found yet.

Offline Firewoodjoe

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Re: 14 questions for Starting a firewood business
« Reply #3 on: October 21, 2014, 03:26:11 PM »
I can help u with your questions and starting your business.... Sell u mine!😊

Offline NWP

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Re: 14 questions for Starting a firewood business
« Reply #4 on: October 22, 2014, 08:00:41 AM »
I'll try to answer some of these. Your region could vary quite a bit as far as supply and demand both of finished product and raw materials.

1. I charge $200/cord if the customer picks up, $260/cord to deliver and dump. I only stack for commercial customers. I also charge them more for the wood. They need oak and hickory as most of the commercial customers are BBQ restaurants. The prices above are for mixed hardwoods.

2. Depends how much breakdowns cost.  :D  That has a lot of variables.  Raw material costs etc.

3. I pay them hourly.

4. A lot. Like Kilgrosh said, this all depends on volume and equipment.

5. I average 2 cords per hour when my processor is running. Back when I used a chainsaw and small splitter, it probably took 3 hours per cord.

6. 500-700 cords

7. This varies. Currently I have 2 guys that are part time. A year ago, I had 2 that were full time. Their duties vary. One day they may be making bundled wood the next they may be making deliveries. It's hard to have a full time guy. Even at the volume we do, there are slow times.

8. I wish. We do get some free but a very small portion. We actually get paid for some clearing jobs and get the wood in the process. This is obviously the best possible scenario, but generally we have to buy logs. We do buy some already split wood too. Personally I'd recommend staying away from tree service wood as a source. Never know what you'll get and how much metal will be in it.

9. $100-120 per cord average for firewood logs. I have to compete with pallet mills for some logs.

10. This would depend on how much you pay for wood. If it's free, then your greatest percentage of profits will probably be from your basic cord of firewood.

11. Depends how much you want to spend. Starting out, I wouldn't recommend going crazy buying stuff. Start small. I use dump trailers. They work good. Remember, your ad on Craigslist will be one of a hundred or so. I don't advertise there but I have interstate frontage and a big sign. A hot delivery girl would definitely be a plus.

12. See 13

13. I've been at it 24 years. As stated above, I've got 2 part timers now.

14. We started grinding and selling mulch about 6 years ago. It's done ok. We make colored as well as natural mulch. We also do a little bit of logging and some tree work. Most times I sub out the tree work. We do grapple truck work (hauling brush, trees) for builders and developers. That material is used for firewood or mulch.

It's not an easy business and there are many times I've asked myself redprospector's question 15. Keep your overhead low. I started out with a chainsaw and splitting maul. I thought I'd made the big time when I bought my first splitter. Something else to remember is that your teenage boys will grow up and may not continue to do wood. If you keep your investment minimal, you won't have a lot of money tied up in stuff that you've got sitting around. Hope this helps.
1999 Blockbuster 2222, 1994 Duratech HD8, 1997 Duratech HD10, 2011 Case SV250, 2000 Case 1845C, 1990 Peterbilt 378 w/ Hood 7000 loader, 2001 Chevrolet, 2005 Chevrolet, several trailers, and Stihl saws.

Offline Frank T

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Re: 14 questions for Starting a firewood business
« Reply #5 on: October 23, 2014, 12:41:04 PM »
To All

Thanks for all the great information. I think the LLC is a great idea, never thought about morons trying to sue me for damage.

Im hoping to get more input on this post so here is some more background on my situation.

I already have:
two 1/2 ton pick up trucks
one 1-ton (3000lb gross) single axle trailer
one 22 ton log splitter
three Stihl Chainsaws (025,036,039)
15 acres of free wood
two 15 year old boys semi-willing to work

This venture is partly an opportunity for my boys to understand all the things involved in a business along with get them out of the house and make some money.

Thanks
Frank T



Offline glassman_48

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Re: 14 questions for Starting a firewood business
« Reply #6 on: October 25, 2014, 06:30:19 PM »
Frank,
Another idea is to buy a firewood bundler for your kids, have them go out and get some party store accounts.  They can learn a lot of responsibility that way.  My son got his first party store account this summer, and it has taught him a lot.  I purchased a firewood processor I used money from my retirement account so I would not have payments.  We concentrate on mobile firewood processing, I have to pay almost retail for pulpwood so I cant make much money on firewood.  We were getting 75 bucks a face cord around northern Michigan last year.  I have heard some of the prices are over 100 bucks now because of the price increase of pulpwood.  The only way I sell firewood is to process it right into my dump trailer which holds about 3 face cords, I do not handle firewood at all except loading it onto my processor.  good luck,,,,,Ed

Offline timberlinetree

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Re: 14 questions for Starting a firewood business
« Reply #7 on: October 26, 2014, 03:42:49 AM »
Some times it's not the money you make, it's the memories you make.
I've met Vets who have lived but still lost their lives... Thank a Vet

Family man and loving it :)

Offline glassman_48

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Re: 14 questions for Starting a firewood business
« Reply #8 on: October 26, 2014, 08:21:00 AM »
timberlinetree,
Well said, I have worked at the booths at logging shows and the biggest kick I get is when a young guy or girl come up and tell me how their family purchased a firewood bundler and now he/she has their own car, or they bought their own clothes or helped them start college, or a business etc.  A friend of mine sells his kids firewood (they are 9 and 10) and they haul the wood out to the highway and put it in ricks to sell, all summer long they run out and check to see if they have sold anything.  I think he said they sold about 1500 bucks worth this summer. 

Offline NWP

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Re: 14 questions for Starting a firewood business
« Reply #9 on: October 26, 2014, 08:42:16 AM »
My youngest 2 boys sell small stacks of wood too. The pick up pieces at my firewood yard and split them if they need it and stack them up to sell to campers.
1999 Blockbuster 2222, 1994 Duratech HD8, 1997 Duratech HD10, 2011 Case SV250, 2000 Case 1845C, 1990 Peterbilt 378 w/ Hood 7000 loader, 2001 Chevrolet, 2005 Chevrolet, several trailers, and Stihl saws.


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