Firewood prices

[jimbarry]

It's not that we want to. That's what it works out as when trying to come up with a marketable price. Throw me a dollar wage that you think would be reasonable, $20, $25 or more? I will throw it into the spreadsheet and we'll show the results.

[doc henderson]

but at least you are charging for fuel and keeping track of time for loading and kiln drying and fuel cost.  so this is at least profit.  If you get on a roll and things done more efficiently, then the actual profit goes up.  I assume this is done to show costumers that you are not making a killing on their purchase.

[jimbarry]

but at least you are charging for fuel and keeping track of time for loading and kiln drying and fuel cost.  so this is at least profit.  If you get on a roll and things done more efficiently, then the actual profit goes up.  I assume this is done to show costumers that you are not making a killing on their purchase.

We're probably as efficient as can be. Maybe dumping the crates of firewood instead of hand loading would speed things up, but the process of dumping crates usually damages the crates in one way or another. They were not built for dumping. So where you might gain in time loading, you lose in time fixing crates. Could rebuild the crates, again, more time and material costs.

I don't show the customers those calculations per se. Now if they ask why our prices are higher, I'm certainly willing to explain to them what's involved. Like it was said earlier, if they knew what was involved to produce firewood they would likely understand more.  

I don't consider the hourly wage a profit, nor the time or fuel expense. Now, it could be consider part of Gross Revenue, but once all the operational costs are taken out, all that's left if net profit. I've always looked at transactions from a business standpoint, as if I had someone hired to do the work. There's many firewood sellers who hire out the work and simply finance the operation to obtain a profit. Capital costs, Inventory Cost, Labour, Operational Costs and Profit.

That's why one of the variables is Profit, and it's more for kiln dried since its a premium product. It's still not break even to be realistic about it all. It only would take one or two breakdowns of one of the trucks or skidsteer to wipe out profit for several years. Sure, could boost production but it would require hiring people. That gets into even more liabilities and risk management. I'd rather keep it small scale at this point.

[mike_belben]

Those ride behind trucks are typically called moffets, though there are many brands.  A straight truck with moffet would be the ticket for crated deliveries.

I will probably never get to that point, but thats the thought process.  We have mild winters, cheap TVA electric and cheap natural gas from just a few miles away plus legions of pillhead firewood so boutique firewood is a very tiny demand. 

[doc henderson]

Jim I guess my point is some would go out and cut wood laying on the side of the road and sell a trailer load for a hundred bucks, and say I made a hundred bucks.  many in the non professional firewood think like that.  If I were buying from you, I could not argue with you making only 15 bucks an hour.  I might think about it if I saw a crate of wood for 250 dollars.  I used to buy a trailer of fresh cut dead wood 30 years ago, when I worked 18 hours a day.  It was a group of couples that did it for fun, they donated their time and all the cash went into a fund for a ski trip each year.  Heck I had fun just buying the wood from them.  they all came along and stacked it behind my house.

[Magicman]

the only way youll get firewood to rise is to form a firewooders association and agree to raise prices together in unison.

Price Fixing

[jimbarry]

the only way youll get firewood to rise is to form a firewooders association and agree to raise prices together in unison.

Price Fixing

Very true, and illegal, at least here.

[Magicman]

That is why I have never asked and have no idea what any of the surrounding sawyers charge to saw.  I charge a fair sawing rate for the customer and one that will also yield a fair profit for me.  I will not negotiate nor lower my sawing rate.  The other sawyers have their own business profile and I assume that they are doing the same.

[Big_eddy]

We charge $320 for a generous measured cord delivered within 25km. We see others advertising "roughly" a cord for $350 or more, 2 available, or pickup only or delivery extra. And I know of others selling at $300 a cord and no need for any advertising. We did our math and $320 worked so we set that price for the season. And our goal was to start deliveries in June and sell a few cords a week and be sold out by end of August so we can cut and split in the fall instead of delivering non stop all September. We did (60 cord)and the phone keeps ringing. 

Every customer we delivered wood to seemed pleased with the wood, and most are repeat customers. They called, confirmed the cost, booked a time and paid.  No customer ever questioned the price we stated. 

Our business model is to provide premium service and a generous cord at a fair price. We want our customers coming back to us. And they all do. To the point we have had to disappoint repeat customers this year. We called every past customer in July. Some waited too long to call back  But they all want us to call them again next year and promise to respond earlier.

As a side note, our 25km radius is firm. That is as far as we go. No delivery fees, no extra charges for longer distances. No sob stories. If they are outside our delivery radius, we politely decline or refer them to someone else. We will sell out within that radius, there is no need to drive further. 

[HemlockKing]

Going for a cord of split hardwood around here seems 265. I won't ever sell at that. I'd sell my softwood for that. Hopefully these people that are selling 200-250 ish realize they are screwing themselves, working way to hard for to little, being taken advantage of.

[Spike60]

Landscaper came down from Windham/Hunter yesterday, which are both "ski towns". (They each have a slope). Up there it's $300-$356 for a real cord, so it's heading in the right direction. He's one of those guys who doesn't care about the low ballers. Has plenty to dio besides firewood, so either he gets what he wants or he's off doing something else.

And like a lot of you guys, he's offering a superior product. Delivered a cord the other day and it dwarfed a "cord" delivered by someone else. We're the same way really. He had 2 Exmatks go down yesterday. One needed a trans belt, the other needed an electric clutch. Parts in stock and both up and running in a half hour. No other shop can do that, which is why he drives down here from the next county. Our prices are high because we offer a high level of service. The homeowners with their box store equipment think we are expensive, but it's not about them, and we don;t care if they come in or not. I guess the box stores are the "lowballers" for us. Not at all interested in that end of the market.

Tom: Yes, sure I know those guys.

Jim Barry; Impressive how you have your operation set up!

[barbender]

Jim, I hope my comment didn't come across as an insult. I really admire your operation, and truth be told if I accurately accounted for my time I'd probably be in the same wage range. My solution is to not keep track my time and then imagine that I'm making $30/hr😂 So, if you plugged $25/hr into your spreadsheet, what would your price be?

[HemlockKing]

Jim, I hope my comment didn't come across as an insult. I really admire your operation, and truth be told if I accurately accounted for my time I'd probably be in the same wage range. My solution is to not keep track my time and then imagine that I'm making $30/hr😂 So, if you plugged $25/hr into your spreadsheet, what would your price be?

This is why I decided to care for my own land in the process of getting the firewood. Not much money and hard work in firewood. But it feels worth more if it's also TSI of your own property, at least that's how I feel. I'm sure you average out much less cords though as opposed to having delivered and bucking, but maybe it makes up the difference in it being the wood from your TSI would be free? If I didn't have my
Own TSI going on I don't think I'd bother with firewood

[Old Greenhorn]

Bob, I just realized that those two guys I described could have been any of over 100 guys that frequent your store from a 3 county area, so yeah, you know them. :D (BTW, I am going to be on Ryan and John's radio show on 10/13, so I get to join your club.)

 I follow this thread and learn and share for 3 reasons: 1) I burn and process my own firewood, but my cutting days are numbered, B) A lot of my friends sell firewood and I am always on the lookout for things that may help them, and 3) With my Mushroom log business, there are a lot of parallels, so learning opportunities and tips abound here, for me.
 Of course the only direct similarity between firewood and mushroom logs is that it grows on trees, customers can be 'challenging', and pricing is always on my mind because it never seems to be quite enough....yet.
 
I just did some rough math and if I sold my mushroom logs by the standard cord of 128 cu. ft. (which I do not), the cost would be $761.00/cord based on average log size of 6 x 40". Sounds great right? Not really, but that's where I stand right now. That's at $4/log (my actual pricing) and the price goes to $5/log after the first of the year (which would come out to $914/cord if I sold that way). I have been informally polling clients when I make deliveries and not one of them thought the price increase for next year was unfair or unrealistic. I am sure the orders may get smaller for some, but that's just fine. I am learning you have to forget about the market sometimes and charge what you need to get in order to run a business. If this price is too high and nobody buys from you, then maybe you are in the wrong business?
 I did strike up a friendship with another log seller when I started. I told him I was getting $3/log (at that time) and he said 'man I don't know how you can make any money at that price, but more power to ya.' I thought on that and sold a couple hundred logs then realized I was working at a slight loss (and zero profit) so I raised it to $4/log and it was 'just ok' and manageable. I took that as 'cost of education and developing the business'. Now I am educated and have run detailed spreadsheets so I know exactly what my costs are over the length of a very hard season and now know that for me, I have to raise the price to justify the work, time, expense, and chiropractor bills (yes, that is an actual expense in doing this). I need to get in touch with that guy soon and let him know of my adjustment so he can laugh at me. He keeps inviting me up to tour his farm but I just haven't had a free day to make the drive. I think sometimes we focus too much on surviving and not enough on making a decent living.
 A lot of folks ask me if I sell firewood and I just say "Heck No" and refer them to any of a handful of good guys around here. The other day I was finishing up at the sawmill and the other guys were running a load of firewood off to finish out their work day. I went over and gave a hand. We filled the dump truck in about 45 minutes just using a 6 way timberwolf and a conveyor. It's just 'fill out the day' work for them and extra money for the company. But I realized with basic equipment, fire wood is SO much easier than those mushroom logs on my old body. Yet, there is no way I would jump into that business. I don't need those headaches. My hat is off to all you folks that 'make it work' for you. Firewood has to be one of the toughest businesses.

[jimbarry]

Jim, I hope my comment didn't come across as an insult. I really admire your operation, and truth be told if I accurately accounted for my time I'd probably be in the same wage range. My solution is to not keep track my time and then imagine that I'm making $30/hr😂 So, if you plugged $25/hr into your spreadsheet, what would your price be?

No offense taken. Attached are two screenshots, one showing $15/hr and the other $25. It shows all the calculations. Big pics so you might need to open them up individually in a separate window (or however you view the forum). Calcs show pricing for 1, 2 and 3 cords.
$15/hr



$25/hr


 

I think sometimes we focus too much on surviving and not enough on making a decent living....Firewood has to be one of the toughest businesses.

Ain't that the truth.  As for it being a tough business, I think just being in business is tough enough. I enjoy doing firewood...at my pace, in a work method that works for us. It's a great way to get in the daily exercise. Its like getting paid to go to the gym...almost ;)


Edit: Looks like the forum automatically reduces the images. So, here's just the screenshots of the final pricing.

$15/hr


 

$25/hr


 

[jimbarry]

TSI
Someone school me on what this acronym is?

[Old Greenhorn]

TSI, Timber Stand Improvement. Cutting to maximize the quality in a stand of timber i.e. thinning out overgrowing, releasing the better trees, culling unwanted species, etc.

[mike_belben]

TSI work produces almost purely firewood. They really go hand in hand. 

The result is a future high quality forest with a faster growth rate than if left alone, if you do it right. 

[jimbarry]

I think here they call it Stewardship. Some examples;
https://www.nswooa.ca/uploads/5/9/6/9/59690537/biodiversity-stewardship-guide.pdf
https://novascotia.ca/natr/woodlot/pdf/Ecosystem-Classification.pdf
http://www.bondrup.com/uploads/6/7/6/5/6765532/1-30.pdf

[Spike60]

I'll be sure and catch that show Tom. Vern Rist from Healthy Trees was on last week. Bunch of us old dudes passing along some knowledge. Hope some young dudes are listening.

[Old Greenhorn]

Well, don't get your hopes up too high. I'm a bit nervous about the whole thing but Ryan asked me on so what the heck. Yeah I enjoyed last weeks (9/16) show. I don't know that fella, but he knows what he is talking about. In fact, I listened to it twice while I was working in the shop. They haven't posted this weeks (9/20 and 9/27)shows yet that I can find. Next week is John Michelotti.

[Spike60]

Nothing to be nervous about Tom. Your posts are well written so you ought to be well spoken. It's just hanging out with Ryan and John and BS'ing for an hour. And you will be shocked at how fast that hour goes by. It'll be fun. 

[Old Greenhorn]

......... Your posts are well written so you ought to be well spoken.......

Yeah, I could see why you  would think that, But.... well, I have never been accused of being the sharpest tool in the shed. I also don't always think well on my feet, or come up with the best thought first, or express it the way I intended exactly. These days anybody can get offended at anything and I would like to minimize that if I can.
 Yeah, it'll be what it'll be and I'll just go with the flow if plan A doesn't work.
 By the way, they haven't released any of the podcasts in 2 weeks now, did they miss shows or are they just behind? I always miss it live and catch it on the replay. Can't hear the station from my place anyway. ;D

[BargeMonkey]

the only way youll get firewood to rise is to form a firewooders association and agree to raise prices together in unison.

Price Fixing

😆.....  the pharmaceutical companies and oil companies can do it but God forbid guys hustling firewood agree on a fair price, which honestly the market does on its own. I can tell you where every processor sits in this county and almost every adjoining county. Who's going to supply the wood ? If your not partnered up with someone around here or cutting logs you might as well hang a for sale sign on it. 


 make more everyday.

[mike_belben]

I wasnt gonna address it but yeah.  Its only illegal if you arent rich.  


When they start enforcing the anti trust laws on google, big beef or pharma i will consider having some respect for the law.  Until then i see DC as an abomination that is headed for judgement. I know what the real laws are and abide in them.