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Author Topic: Pricing my drying services using vacuum kiln  (Read 1027 times)

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Offline GeneWengert-WoodDoc

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Re: Pricing my drying services using vacuum kiln
« Reply #20 on: May 21, 2020, 01:01:31 AM »
I suggest that also you need to add some maintenance costs.  Likewise, some profit.

Perhaps you will have some marketing costs, an accountant to do taxes and maybe more, QuickBooks or other software and a computer with printer to write checks, etc.  payment for your time to do basic accounting.  Then you may have a business tax on equipment.  Water disposal can also sometimes cost money, as the water is acidic and can affect small sewer systems.  What about the cost of the building the kiln is in and the heating costs or air conditioning costs. Some of your health insurance should go into the costs.  Maybe a cell phone too.  Finally, the IRS will not let you depreciate the equipment in two years, so you will likely have income taxes that require more than a Schedule C.  

What about sticker cost?  What about a forklift or other rolling stock?

You might also have snow removal costs, security costs, driveway maintenance costs, and some safety equipment costs.

Then there is the guy that gives you his lumber to dry, but then claims it is warped and stained and at the wrong MC, so he gets a lawyer.  Your legal costs would be large even if you settle out of court.

You also need to get a LLC corporation formed that does the business (for various reasons, including protecting your personal assets from a liability problem with the business or it goes bankrupt).  Similarly, if you have a vehicle used for business, like hauling lumber, it would not be covered with your home vehicles, but would need a business policy.  Also, locate the business away from your home so that if there is a fire, your home will not be damaged.  Also insure the buildings and equipment from tornadoes, fire, theft, etc....all of which are NOT covered by homeowners.

Finally, do not use your cash to buy the kiln, but use a loan.  You can pay the loan off whenever you make enough money.  You will fine that cash can be quite helpful when you start a business.  Also helpful in days like the last couple of months when lumber demand is quite slow and many businesses are running short on cash to pay for lumber drying, etc.
Gene - Author of articles in Sawmill & Woodlot and books: Drying Hardwood Lumber; VA Tech Solar Kiln; Sawing Edging & Trimming Hardwood Lumber. And more

Offline TCove

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Re: Pricing my drying services using vacuum kiln
« Reply #21 on: May 21, 2020, 01:30:48 AM »
I already have an established business, with a 7,000 sq.ft. insured, heated building, with plenty of room for an iDry.  So, indirect expenses like health insurance, snow removal, and cell phone, are already covered. Same with the skidsteer, and driveway maintenance. I think advertising would be low, as ads in these northern Wisconsin papers are cheap. Plus, I'm on a busy highway, with a prominent sign out front.

I found this comment interesting:
"Then there is the guy that gives you his lumber to dry, but then claims it is warped and stained and at the wrong MC, so he gets a lawyer.  Your legal costs would be large even if you settle out of court."

What's the best way to cover oneself for this ?

Offline Walnut Beast

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Re: Pricing my drying services using vacuum kiln
« Reply #22 on: May 21, 2020, 01:52:50 AM »
I already have an established business, with a 7,000 sq.ft. insured, heated building, with plenty of room for an iDry.  So, indirect expenses like health insurance, snow removal, and cell phone, are already covered. Same with the skidsteer, and driveway maintenance. I think advertising would be low, as ads in these northern Wisconsin papers are cheap. Plus, I'm on a busy highway, with a prominent sign out front.

I found this comment interesting:
"Then there is the guy that gives you his lumber to dry, but then claims it is warped and stained and at the wrong MC, so he gets a lawyer.  Your legal costs would be large even if you settle out of court."

What's the best way to cover oneself for this ?
Sounds like your ready to get one 😊

Offline GeneWengert-WoodDoc

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Re: Pricing my drying services using vacuum kiln
« Reply #23 on: May 21, 2020, 08:47:13 AM »
Several things you can do to avoid a lawsuit...
have the customer sign an agreement that

1) wood has natural characteristics that causes warp, checking (end and surface) and can contain bacteria that cause or contribute to wetwood after drying.  Plus, sawing procedures as well as log and lumber handling at the Mill can result in some warp, checking and staining evident at the end of drying.  You cannot be responsible for these inevitable drying defects or any air drying defects.

2). You will follow the best drying practices available for your equipment to avoid defects and extended drying time.  You wil have the drying records available, if desired.  (Then keep very good records.). You cannot be held responsible for checks, stain and warp when you follow the correct procedures.  Final moisture content checks will be done with a Delmhost J2000 meter and appropriate auxiliary equipment.  Any complaints for moisture content will ddbe done with this meter.

3). When on the premises, the customer will use hearing protection, use eye protection, wear a hard hat and follow appropriate health requirement, such as social distancing.

4). Lumber that is not picked up promptly after drying can be subject to storage defects, such as moisture changes and insect damage,
which are not the responsibility of the drying company.  Dry lumber that is not picked up within a week will be changed for storage costs of $15 per MBF per day payable at the time of pick up.  All drying costs will be due and must be paid before picking up the lumber.

5). Any complaints about drying quality must be received within two weeks of delivery of the dried lumber.
Gene - Author of articles in Sawmill & Woodlot and books: Drying Hardwood Lumber; VA Tech Solar Kiln; Sawing Edging & Trimming Hardwood Lumber. And more


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