I couldn't find anything on the subject of sawing for a split share. What would be a fair cut between the logger and the sawer ???. I am not sure what would be the best deal for our labor, wear and such, unseen stuff. What percent would be a fair deal as there would be 3 equal shares.
i can't see how to answer this without more details. What is the cost and difficulty involved for each? What kind of logs/lumber? How difficult is it for the logger to get the logs out of the woods? How far does he have to haul them? Are you moving the mill to a log landing to saw closer to the source? If so far how far are you moving the mill? I would figure it something like this:
1. Value of the logs
2. Cost to produce the logs
3. Cost to transport the logs
4. Value of the lumber
5. Cost to produce the lumber
6. Cost to transport and market the lumber
Figure up these costs for each side then see where the percentage shakes out. Good luck.
the only values that matter here are
4. Value of the lumber
5. Cost to produce the lumber
the rest is irrelevant
they cut transport pickup cut wood...we cut,stack in three piles.
33 percent seems a bit low for cutting his log. 50% seems a bit high
leaving us to split 50%. we have labor, wear and tare on equip and us.
basicly they bring a log, we cut it up and load it out on his truck.
Does that make a little more sense?
Yes, much simpler. Am I right that you are sawing his logs and he is paying you in lumber - is that an over simplification?
If so, how much would you charge for the sawing for any other customer? How much is the lumber worth to you keeping in mind you have to transport, store and market it? I'd use those numbers to determine the split.
Caveat, I don't saw on shares. There are a lot of ways of doing shares but, "3 equal shares" sounds like a nightmare. Who is getting a share besides the sawyer and the owner?
When someone wants to use some of their logs and sell others (if they are something I can use), I assign a value to each of the logs first. They then choose which ones they want milled. When we are done, I figure up their bill and give them a credit for the ones I am buying. My milling fees may be equal to, or higher, than the amount I normally pay for logs.
Oh yeah, BTW your split should be what it costs to pay for your costs/expected/required profit. The split between the owner and the logger should be up for them to determine based on what is left after your share is taken out. I don't see where you need to even get involved in that and I would stay out of that. Basically just tell them what split you need for your needs and let them work out the rest.
I don't often do milling on shares UNLESS I need lumber for a project!
When I do, I get the pick of the finished lumber at a 50/50 split, no exceptions! No negotiating! I provide the mill, me and milling related tools. Every thing else is the log owner Et El responsibility. When I have sawn out what lumber I need for my project, I switch to my regular ($100.00) hourly rate AND there are 2 stacks of lumber that are IDENTICAL. Any re-sawing of the clients pile is done at the hourly rate. Hourly rate also applies to move to site and set up.
I often go to site and sort logs into at least 2 piles with one being the shares sawing pile. I generally saw the share logs AFTER every thing else is sawn because I tend take a bit more time when I am sawing for a particular project so yield per hour is less.
Keeps it clean and fair.
I have done Toms method with good results as well. I don"t own a sawmill to make someone else money. I work on the principle of "After my bank account is flush, you come First!"
Welcome to the forum Kemp! You live in a beautiful part of WA state. I have more than a few family there and have spent some good summers there when I was young. My daughter went to school there as well.
Quote from: WV Sawmiller on March 03, 2019, 08:24:28 PM
Yes, much simpler. Am I right that you are sawing his logs and he is paying you in lumber - is that an over simplification?
If so, how much would you charge for the sawing for any other customer? How much is the lumber worth to you keeping in mind you have to transport, store and market it? I'd use those numbers to determine the split.
Yep, that is basically it. My problem is that I have -0 experience and I am on the first page of the wanna be a sawmill operator book. Never sawed a log, yet. I am feeling things out while contacting tree trimmers in our local area and you great folks here. Kind of seeing if it will pay for itself. I guess this should have been included in the initial post huh?
Yeah, three people are never going to agree. Each will think they should get a bigger share. This really is a math problem. As some have stated you need to figure your costs, then come to an agreed value for the logs with the owner. Let him work things out with logger. That's his problem. Only deal with one person.
What mill are you using? What is a reasonable hourly rate given your costs? When you figure slab value, don't forget you are buying them/getting paid wholesale because you have to market and sell them at a profit. Are the logs within the mill's capacity? What's the biggest diameter? Species? Wide walnut slabs 36"-48" are worth a lot more than 24 inch pine.
In fact you are being paid in logs, not even lumber. So what would you be willing to buy the logs from anyone else? Figure that value, saw that much lumber for them and let them split it and you saw your logs into whatever has the most value/best turn around for you.
I do not saw on shares, I saw for $$$.
If I need/want logs or lumber that would be a separate transaction.
I'm guessing he doesn't have any logs but want to make some sawdust and get some experience. It's also important to know how many logs we are talking here. If it's one or two, no big deal. If it's 10+....
If you can use/need the logs this can work but keep it simple. They give you $100 worth of logs and you do $100 worth of sawing for them and be sure to be able to document that based on BF or hours sawed rate agreed on before you ever saw the first log. If you finish and there is a difference pay them or give them credit for the balance. Nobody is obligated to the other. If they find another sawyer who will saw cheaper to their satisfaction they are free to use him instead. If they aren't willing to "sell" you the logs at a price suitable to you ,you refuse and saw for cash or move on. Nothing personal - just business and professional and all above board.
Edit/add-on: Be sure they are okay with you cherry-picking the logs. Only accept as payment the logs you can use and want. Don't become a dumping ground for stuff they don't want and you can't use. Make a fair offer for the log and if/when they accept your offer then you saw that much value for them. I am fine with barter work but only if both sides are happy with the agreement.
Is there a good book out that covers the a-z. from unboxing a saw to the customer pickup of boards? I know that is a lot to ask but you never know...Or books if I have to do multiple books. I want to thank you all for your input on this. I am glad I found this forum and thanks go out to them also. good job guys.
You are on the best source I have found. I'd consider the FF a graduate level course in sawmilling. I found this site right after I ordered my mill and read every thread in this section between then and mill arrival. I found business cards, contracts, charging options, advertising, insurance options/suggestions, short cuts, websites, maintenance, etc. Its all here. Surf and search.
Oh yea, I am totally impressed with this site. I sometimes get a lot over my head. then I just re read till I get it...thanks guys
I rarely saw on shares, as I have yet to be able to fill up my fuel tank or pay my bank notes with wood. Sawing for money is a sure bet, sawing on shares is a gamble, based on quality and species of log.
BTW, I can count on one hand how many times people bring me logs to mill that are as high grade as they think. So the monetary value of the resulting lumber is ususally a No. 1 or 2 Common, and sawing on shares will usually only yield a stack of mill run or low grade wood.
When I do saw on shares, it's easy, I get 50% of the green wood, no matter how many other people or parties are involved.
When people ask me if I will saw on 1/3 shares instead of 50%, I say sure, I get 2/3rds of the wood and they get 1/3rd. :D
So basically mill at a fair hourly rate and if you get an exceptional slab negotiate to buy it if it is interesting. sounds fair and I might not get caught with my pant down huh?
Charge for milling, and purchase logs with that money. That way there's no disagreement over who gets what, and its fair as fair can be including the chance that some of the logs in either pile could be trash.
Logs are but one expense when you run a sawmill. Wages,fuel & electricity, insurance, epa fees, maintenance costs, depreciation, administration, taxes... Logs are only a fraction of your true running costs and well under 50%.
Is around $100.00 an hour about normal fees for sawing customers logs?
Rates vary in different parts parts of the country based on expenses, cost of living, availability of labor and materials, taxes, etc. That's high for my area but may be normal in you area. Also depends on the mill and experience. I figure the hourly rate should be based on what I could produce at my bf rate if I were cutting good logs into normal lumber. I use my hourly rate for specialty sawing, poor quality logs or such. If you are an experienced sawyer sawing on a WM Super hydraulic it costs more to saw and you can produce more than a new sawyer sawing on a manual WM LT28 or equivalent mill. (Sorry for the WM analogies but that is the brand and specifications I am more familiar with).
There's lots of topics on this, but I charge what I need to make money.
If I ever eyeballed good boards coming off my mill that that I wanted, I would simply offer the customer true market value.
FYI, I very rarely have a customer actually know the true market value of the wood, so you have to know that yourself, and be confident on the price. Market value is not what is shown on Craigslist, its what the customer can sell the logs to a commercial sawmill or lumber buyer. True market values is based on species, diameter, grade and market forces. The best way to know these values is to get the Hardwood Market Report or through experience.
Most times, when I discuss log prices with private individuals, the customer, through no fault of their own, because they are not in the business, values their logs more than what I can actually pick up the cell phone and order a truck load of similar species and grade of already sawn, green lumber from a wholesaler.
Oner of the most memorable situations I will never forget that illustrates this point, was when I was out at a local mega mill, and a guy brought by a trailer load of the nastiest, bent, curved trash logs I believe I had ever seen on a log trailer. Total garbage. The owner and log guy agreed on a price and they unloaded his trailer. As they were doing that, I talked to the owner of the mill and asked why in the world he would even buy those nasty logs and he said he knew the guy's family, and he felt he could just buy them and run them into pulpwood, so he wouldn't lose money and the guy would be happy. He felt like he was doing a favor to the guy, helping him out. When the owner walked off to attend to other things, I talked to the guy selling the logs, and he was mad because he felt he had been taken advantage of, and the mill owner had ripped him off paying such a low price. :o Then he asked me what I would have paid for the logs and I told him I would have charged him for the diesel fuel it would have cost me to light them on fire and burn them.
I will quickly add, I would not want to pay 100$ an hour to someone who has not sawed a log.
Dealing in saw logs requires x-ray vision and experience. The Yellow Hammer post is a good example of what people think logs are. I have had everything from giant ,rotten nail infested hollow logs to shrubbery dropped here.
When I bought my mill I milled about 20 to 30 MBF of 2X6, 2X8 and wind slabs out of over sized logs I bought from a local mill. The purpose was to learn how to use my mill the most effectively to produce quality lumber. I had a mentor/teacher that has several million BF under his belt working with me to help me learn. He ran the mill for the first 5000BF and I stacked lumber and dealt with the trash and fresh logs to the roll way.
I was pretty good after that first 3 weeks of milling but no where near as good as my mentor.
Sold the lumber for an average of 500/MBF to farmers in the spring and after all was said and done there was just over $9,000 dollars AFTER all expenses were paid. We split that between us.
Based on the production numbers from the "first job", I came up with an hourly rate that my mentor gave me the formula to calculate.
Cut lumber for sale divided by gross mill hours times 25 cents. (25 cents was a common rate in 2007 in this area) For me that came out to 62.50 and hour. I started at 65 an hour.
I did all my upgrades to my mill and today my average production is a consistent 300 BF per hour so my rate is $100 per hour using 30 cents per BF as the base rate in todays market.
I hope this helps you get a feel for how to charge.
I didn't think I would get top dollar to start out (100.00) but just a few bucks for wear and tare till I got some experience under my belt. I was also thinking of keeping jobs small to get more experience and learn about the saw. At least break even for the first few jobs. I hate going in the hole on projects..Don't stay in business long with negative balance. :D :) :o. So I will keep :P, learning, and :P till I finally get the saw settled in. I got the strangest feeling this is going to be a continuing learning experience and fun too.
I want to thank all of you for your time spent with me. I am starting to feel you all are like family trying to help. Thanks for the warm welcome and letting me pick your brains bon_fire...you all rock.
I rarely except an offer to be paid in shares of lumber from logs. I don't need any more stacks of lumber here at the shop. If, by exception, the logs are extremely nice, I tell them they get a third, I take a third and finally the mill takes a third for fuel, blades, maintenance and depreciation. But only if the logs are something nice. Rarely do I offer or except cutting on shares tho.
CCCLLC,
Good point about not typically cutting on shares but remember too in this case we have a new sawyer just starting out and looking to gain experience as hopefully he is making some money. One point we probably have not addressed enough is what the OP is going to do with the lumber. Without a need or market he will do like so many of us and find himself buried in stacks of air drying lumber scattered in every nook and cranny. It appears he has a potential offer on the table for cutting on shares and is looking for help to negotiate the best deal he can make for that option. Any suggestions on a better start up plan?
I started with a 40 acre woodlot I could use for practice, sale and personal use and when I had cut enough of that I started cutting for friends and the public. I assume most of us have or had a reasonable source of logs before we started. I have noted here on the FF where some were diligently searching for sources and it has been interesting and informative to read those answers.
Quote from: Ruffgear on March 04, 2019, 08:51:45 AM
I will quickly add, I would not want to pay 100$ an hour to someone who has not sawed a log.
Oh, I definitely understand that. We used to have a large sawmill here in town but shut down about 20 years ago. Wish I could find one of the employees to have coffee with food3
I have a customer drop off 15 - 8' logs. [First time I did this] He wants some lumber for them. I told him 1/2 a pickup load of 8' stuff. He was supposed to stop buy in a week.
That was last Aug. ::) :laugh:. I bet he will show up this spring looking to fill his truck with lumber,
Because he has not come yet tells me he's up to something. ;D
I did not cut the logs, There in a nice pile waiting for him to show.
Because He's going to want lumber worth more than the logs I have.
Having the logs will keep my pat hand in good shape. ;)
I don't know what I was smoking that day. But. it won't happen again. :laugh: :laugh: :laugh: :laugh: :laugh:
Confession, I'm currently doing a job on "shares". :D
But the wood is quite valuable, and neither of us are too worried about exact values.
Landowner knows the Blackwood is valuable, but couldn't find anyone local to saw it. So it was about to be cut up for firewood. :'( So anything he gets is a bonus to him.
I'll run the mill for a day and take a cube of "log run" blackwood as payment, because I can either use it myself, or sell it for several thousand dollars.
(https://forestryforum.com/gallery/albums/userpics/10460/20190305_120158.jpg?easyrotate_cache=1551746760)
So I'll take that particular load as payment for sawing, and be happy with the deal. But don't expect the same deal on low grade pine that I have no use for.
I sometimes cut on shares, but it is usually only on walnut which I always need. I get 50%.