Part intro, part seeking advice

[AllyCat]

Hey everyone!  I'm brand spankin' new here, and fairly new at everything forestry related.
My husband and I are a mid-20's couple in the midwestern US who are looking to start a tiny logging outfit. There are some larger ones in our area but so many of them look over smaller jobs because the profit margin would be slim after payroll.
My husband has been in the woods in some way (cutting for firewood, helping farmers get rid of problem trees, helping other logging companies who were in pinch for a cutter or operator) since he was 6, so has a variety of experience.
I, on the other hand, have a basic understanding of business operations from my experience at several non-logging related jobs at small businesses, a few random classes taken years ago, and having worked as a "rolling secretary" for a disabled logger. Between the two of us, we have a functional knowledge we are looking to build upon before actually starting anything up.
We're looking for advice, input, whatever you may have, from experienced personnel to help us gain more insight into what running such a business fully entails as well as some resources that may be available for additional training or educaton, like for how best to assess a job and give estimates so as to still make a profit.
Pretty much anything you have to offer is welcome.

Thanks for reading this, have a great day!

[Ljohnsaw]

Welcome to the Forum!

So what are you thinking you want the business to be?  You say working smaller wood lots that the big guys are not interested in.  Would you just be cutting/hauling wood up to a landing?  Cutting firewood?  Buying the wood?  Selling the wood to a mill?  Milling the wood yourself to sell lumber or milling to the landowners specs?  Could be a lot of things to the business!  So many questions and decisions! ???

[Ron Wenrich]

In our area, those small woodlots can be lucrative, because there is so little competition.  But, they are also difficult to lot.  You should be able to buy your stumpage a bit cheaper than on the larger jobs.  But, your logging costs will be higher. 

The big problem is what type of equipment you'll need.  You'll need something to drag logs out.  You may find that you'll be skidding log length instead of tree length.  That gives you a better job, as there is less damage to the residual.  How your job looks after you're done will have a huge impact on how easy it is to get those types of jobs.  The other thing you should have is something along the lines of a tri-axle log truck with a loader.  You can get them into fairly small areas. 

Loggers make their money by marketing logs.  That means you should have various outlets for those logs.  You should have some sort of yard to sort through for the various different markets.  I worked for loggers that happened to have a sawmill.  They bought various stumpage and sorted into firewood, pulpwood, sawlogs, veneer logs and mill logs.  They had several firewood markets and would cut, split and deliver in trailerload lots.  Some sawlogs weren't of the quality we wanted in the mill or we could get a better price than sawing.  There were several different types of veneer buyers.  Some were for core stock, some for veneer.  Veneer has to be laid out for the buyers. 

Estimating value would mean that you will have to measure and cruise the timber or have someone do it for you.  To place a value, you need to have a good idea what the tree will yield in grade.  Most of the value is in the butt log.  You need to know your logging costs, hauling costs, and your markets. 

[POSTON WIDEHEAD]

Welcome to the Forestry Forum Alley Cat. 

[coxy]

welcome to the FF

[WV Sawmiller]

   Welcome and from your picture you add class to this group of mostly old timers.

   Good luck on your endeavor. I hope you find a profitable niche.

   What kind of equipment do you own or have access to? How about working space. I am no a logger and assume most wood goes straight to the mill but I can see where storage space/holding area for some logs might be profitable. What kind of contacts do you have with local mills, foresters, and woodworkers?

[Roxie]

Welcome to the forum, and as you can see there is a wealth of knowledge here, and we are also very patient folks.   

...clears throat and wonders who WV Sawmiller is calling an old timer, especially today. 

[AllyCat]

Thanks, everyone, for taking the time to respond!
Currently, my husband is a full the mechanic and has made some connections with local contract truckers who have told him they would be willing to haul for him, so we have options on that end. We also have some connections for several saw mills within about 80 miles, many of which are Amish and a few others, and some names rounded up for selling veneer.
From what we have discussed so far, but may be subject to change, we're sort of looking at cutting/ skidding/stacking, and being the middle man more or less. We'll bid a job, he'll do the work, we'll line up hauling, get check once sold, deposit into our business account and cut landowner a check based on bid price and what was hauled out. From some of the local larger businesses we've talked to, that's how they started before they had the cash to be buyers.
We're in the process of buying an older Franklin skidder if everything goes as planned, and my husband co-owns a skidsteer with his dad but we eventually plans on buying his own, once we get going. He has some chains and tires (compatible with the Franklin), a few saws, a truck that can haul the skidsteer, and recommendations for someone who can haul the skidder as needed. So while we certainly aren't ready to start, I *think* we have a good base to build on.
What we don't know much about is the bidding process, how to keep up to date on market prices, self-employment process, and I know nothing about tree species which is a problem since he expects me to check out potential jobs if he's busy in the woods. I learned more of the buying/ selling and payroll aspect when I worked for a log company in the past.

So like I said, pretty much anything is welcome, I'll take anything into consideration

[r.man]

Here timber cruising and marking for stand improvement or otherwise is a job unto itself. If the landowner is serious about having an acreage cut that part of the job could be paid for directly by them prior to a contract.  This would give them an independent accounting of what is there and what should be removed and give you some solid numbers for volume, grade and species to plan and price. Your job then becomes more of a paperwork and physical site assessment based on the cruisers report.

[bill m]

Allycat, welcome to the forum! Have you reached out to any of the local private foresters? A lot of times they are looking for good loggers to work smaller lots the big contractors won't do. I have an arrangement with 2 foresters that give me work. I don't bid on lots and get paid on mill scale. Currently I have about 8 years of work ahead of me and people are willing to wait.

[AllyCat]

Bill M, I haven't, but we also haven't gotten off the ground yet. How does something like that work?

We still have so much to figure out and finalize right now. I just looked at basic insurance costs today and not going to lie, it was a little discouraging!
We are hoping to start off with little to no debt, but start up costs keep adding up in my notebook.

[Ron Wenrich]

We had consultants that would come to the yard and feed us sales  Most were on the small size and they knew we would do a good job and would pay a fair price.  Some jobs were jobs that others wouldn't want.  We would cut firewood trees, since we had a market for it.  For the forester, these sales are more cost than income, but you don't want to walk away from money. 

The forester will have the timber marked and scaled and will have a dollar figure he wants.  You have to look at it and make sure the quality is there for the price.  He'll draw up a contract, and he may want some money to secure the deal.  They will have all the leg work done for you before hand.  Best way to find out if you can get a forester to work with you is give them a call.  You should be able to get a list of them from your state forestry dept or from the Assn of Consulting Foresters.  This would be the easiest way to start out.

You'll need liability insurance.  If you don't have any employees, you probably won't need workman's comp.  Each state is a little different, so check with your commerce dept to figure out what is needed and what isn't.  Keep good books.

[WDH]

Down here, the mills treat the small loggers pretty shabbily.  They support the big producers that haul large volumes to their mills, and when times are tough when their woodyards are full of inventory, the small loggers get cut-off first, and many of them starve.  Your biggest challenging is marketing and finding markets that will not treat you like a yo-yo on a string.  Up, down, up, down.  In my opinion, stable markets are the most important thing that you have to solve.  The timber is there on the small woodlots that the big producers do not want to fool with.  But, you have to consistently sell your wood. 

[AllyCat]

Thanks for everything so far! Definitely a lot to consider.
All this help is great.

[coxy]

the hardest part is getting a good name for your self  after that its not to bad   take lots of pics to give to land owners even the bad pics work well they seem like if your willing to go that far and show them a real mess that you made your good enough to cut there logs  I have some  pics before I start cutting during the cut after the cut and some 2-5 years later I don't take pics of all my jobs but a lot of them  I try to explain to the LO some of things I'm trying to do and it makes them feel good to  and just remember you will never please every land owner there will always be a few no matter what you do it wont be good enough always seems its on the last load of logs the crying and moaning will start  ;D     good luck with what ever you  do and keep us posted on your progress

[WV Sawmiller]

AlleyCat,

   Be sure to go to your states forestry site and talk to their foresters. I was helping a friend try to get rid of some logs and checked and found our state has a training course for loggers and foresters. Upon completion of their course your name goes on a list of authorized people who can buy logs, etc. I am confident you need to be approved by your state before you can sell logs to the big mills.

   I am interested in your comment about access to the Amish mills and I assume other small private/family owned mills. That may be a niche market ideal for the small lots you seem to be interested in chasing. The problem I would see there is whether they are interested in buying all the logs off a lot or if they just want a truckload or so at the time. That's great for the buyer but maybe not so great for the seller if he does not get paid till the logs are sold. Same with you if it means you may have to hold the logs for a while.

   Do you or your husband know how to grade the logs or are you depending on the grader at the mill to grade them.