Firewood buisness question

[Femur Breaker]

So I've gotten into the firewood buisness, taking over where my dad left off. He became disabled a few years back and left the buisiness. So this summer, I figured that along with my full time job i would do some firewood as well. Easy for me, because my dad already has the splitter, and I have a great piece of property to serve as a woodlot.

But I'm still new to the buisness myself, and I'm curious just how good the deal I have procured is.....I have a supplier charging 400 dollars a log load on the landing. Guaranteed 6 plus cords of mixed hardwood. He then finds someone to haul the loads, at a charge of 100-200 dollars. He also guarantees the trucker wil not charge more then 200 per load. All deals are done with a contract. So i guess my question is, what are others paying? What guarantees are you given? Seems like a pretty good deal to me..

 

[Moss Man]

Not sure if this will help, you'll have to break down the numbers to compare it to your deal. I have several suppliers right now and they are all charging me $110. a cord delivered to my house where I process the wood.

Bottom line is there is no contract, just a hand shake. They treat me well.
Again, $110. per cord and it is delivered to me.

pm me if you have any specific questions and welcome aboard.

 

[thejdman04]

Around here its about 1000 dollars per truck load 8 cords per load

 

[Moss Man]

Around here its about 1000 dollars per truck load 8 cords per load

$125. per cord, still sooo much cheaper than oil!

 

[Tree Pig]

So I've gotten into the firewood buisness, taking over where my dad left off. He became disabled a few years back and left the buisiness. So this summer, I figured that along with my full time job i would do some firewood as well. Easy for me, because my dad already has the splitter, and I have a great piece of property to serve as a woodlot.

But I'm still new to the buisness myself, and I'm curious just how good the deal I have procured is.....I have a supplier charging 400 dollars a log load on the landing. Guaranteed 6 plus cords of mixed hardwood. He then finds someone to haul the loads, at a charge of 100-200 dollars. He also guarantees the trucker wil not charge more then 200 per load. All deals are done with a contract. So i guess my question is, what are others paying? What guarantees are you given? Seems like a pretty good deal to me..

Thats not too bad but if you can balance it off with all the free wood you can find to increase your profit it would be much better. Contact every tree guy in your area and tell them they can drop it any time or you will pick it up.

You may only get a couple of takers but if you can pick up a few loads of free wood woooooooohooooooooo.

 

[thejdman04]

Just watch with tree companies. Many times they drop rotton, twisted crud wood, keeping the best for themselves. They pile the wood on top of the chips in the chip truck and when they drop the wood they also drop the chips, leaving you with a huge mess. dont ask me how I know.

 

[tomtrees58]

Just watch with tree companies. Many times they drop rotten, twisted crud wood, keeping the best for themselves. They pile the wood on top of the chips in the chip truck and when they drop the wood they also drop the chips, leaving you with a huge mess. don't ask me how I know.

::greenchainsaw::hmm3grin2orange:that's the tricks of the trade tom trees

 

[Femur Breaker]

Doing the math I'm getting it for $88 to $100 per cord. Around here seasoned is going for $225 a cord so thats a pretty nice profit margin after fuel and maintenance costs.

 

[Tree Pig]

Doing the math I'm getting it for $88 to $100 per cord. Around here seasoned is going for $225 a cord so thats a pretty nice profit margin after fuel and maintenance costs.

now calculate how long it will take to cut split and stack a cord. Figure out what your making hourly it may not be as great as you think... unless you have a processor then not too bad.

 

[Femur Breaker]

I dont have a proccesor but I can do 2 cords of wood in a six hour day. It helps too that I don't have to rely on the wood I do to pay the bills..... the money I make from this buisness is going right into savings to build my log cabin when it comes time. It's more of a hobby for now since I have a full time, reliable job already.

 

[Moss Man]

Whether or not you make it in firewood sales is dependant on numerous factors. I don't plan to get rich on it and I don't have the seasoned body that it takes to do it by hand.

The main reason I do it is that I prefer to work alone. I have worked in factory settings all my life until now and I typically don't get along well with people in that enviornment, you have to be around all types and tolerate alot of B.S.

Bottom line is how bad do you want it and how hard are you prepared to work for it.

There will be good days and there will be bad. There will be days when the equipment sings like a song and then there will be days when you want to light a match to the whole deal.

Have fun with it and see where it goes, if you don't tie up alot of money in it, you won't have to be married to it.

 

[Turkeyslayer]

Whether or not you make it in firewood sales is dependant on numerous factors. I don't plan to get rich on it and I don't have the seasoned body that it takes to do it by hand.

The main reason I do it is that I prefer to work alone. I have worked in factory settings all my life until now and I typically don't get along well with people in that enviornment, you have to be around all types and tolerate alot of B.S.

Bottom line is how bad do you want it and how hard are you prepared to work for it.

There will be good days and there will be bad. There will be days when the equipment sings like a song and then there will be days when you want to light a match to the whole deal.

Have fun with it and see where it goes, if you don't tie up alot of money in it, you won't have to be married to it.

:agree2:Well said

 

[Femur Breaker]

Whether or not you make it in firewood sales is dependant on numerous factors. I don't plan to get rich on it and I don't have the seasoned body that it takes to do it by hand.

The main reason I do it is that I prefer to work alone. I have worked in factory settings all my life until now and I typically don't get along well with people in that enviornment, you have to be around all types and tolerate alot of B.S.

Bottom line is how bad do you want it and how hard are you prepared to work for it.

There will be good days and there will be bad. There will be days when the equipment sings like a song and then there will be days when you want to light a match to the whole deal.

Have fun with it and see where it goes, if you don't tie up alot of money in it, you won't have to be married to it.

Working for another company offers me a great income. But I am much like you Moss man, I hate dealing with most of the idiots I have to hire to work for me. I find that owning my own buisness gives me a bit more ambition when it comes down to it. Don't get me wrong, I'll treat a companies money as if it were my own, but when it's my money being used I definitely get more satisfaction out of doing buisness.

I've become sick of corporate america as of late. I am accountable for 1 million dollars in profits at my current job. I've cut cost's, saved tens of thousands of dollars in company money...and did I get a bonus this year...lol i think not. So the wood buisness is a great outlet on the weekends to actually do myself some good, and not someone else.

And I won't lie, wood is an addiction and a lot of fun to do...when things go right.....

 

[dnf0929]

Working for another company offers me a great income. But I am much like you Moss man, I hate dealing with most of the idiots I have to hire to work for me. I find that owning my own buisness gives me a bit more ambition when it comes down to it. Don't get me wrong, I'll treat a companies money as if it were my own, but when it's my money being used I definitely get more satisfaction out of doing buisness.

I've become sick of corporate america as of late. I am accountable for 1 million dollars in profits at my current job. I've cut cost's, saved tens of thousands of dollars in company money...and did I get a bonus this year...lol i think not. So the wood buisness is a great outlet on the weekends to actually do myself some good, and not someone else.

And I won't lie, wood is an addiction and a lot of fun to do...when things go right.....

Same here. As twisted as it may sound to some I do it first and foremost because I thoroughly enjoy it. I get to work at home, at my own pace, enjoy the outdoors, get a physical workout, have virtually no heating costs and make a few bucks. I also have a good full time job with health insurance, pension and benefits that is recession proof so I don't have a ton of pressure to use firewood to pay the bills. When I first started selling I did all sorts of spreadsheets and analysis to try and figure everything out to the penny and drove myself crazy. All I can say now is when the fall rolls around and I start ending up with extra cash in my pocket each weekend it's a great feeling even if I'm only breaking even.

 

[Wood Doctor]

Cost vs. Revenue

Fixed Costs at Startup the First Year:
Truck ---> $3,000
Chain Saws ---> $1,000
Log Splitter ---> $1,500
Equipment Maintenance and Repairs ---> $500
Fuel and Oil ---> $900
Advertising and Insurance ---> $300
Miscellaneous ---> $400
-----------------------
Total Annual Fixed Overhead ---> $7,600

Cords/year required to break even = $7,600 / $100 = 76

That's assuming you can sell each cord of wood for $100 more than it costs you to buy the timber. So, after you sell your 76th cord, the rest of your deliveries start earning you some profit. In the second and all subsequent years, most of the above fixed costs will still have to be absorbed.

Fudge down or up on any of these figures as you see fit.

 

[willsaw4beer]

Fixed Costs at Startup the First Year:
Truck ---> $3,000
Chain Saws ---> $1,000
Log Splitter ---> $1,500
Equipment Maintenance and Repairs ---> $500
Fuel and Oil ---> $900
Advertising and Insurance ---> $300
Miscellaneous ---> $400
-----------------------
Total Annual Fixed Overhead ---> $7,600

Cords/year required to break even = $7,600 / $100 = 76

That's assuming you can sell each cord of wood for $100 more than it costs you to buy the timber. So, after you sell your 76th cord, the rest of your deliveries start earning you some profit. In the second and all subsequent years, most of the above fixed costs will still have to be absorbed.

Fudge down or up on any of these figures as you see fit.

Eh, I dunno, a $200 saw off craigslist, $50 for a Fiskars and another $50 for sledge and wedges. Then get a $500 truck after you've sold a few cords. Do the maintenance and repair yourself, and buy fuel and oil as needed. And about $500 in beer from all the aches and pains from swinging a maul for 8 hrs a day...

 

[Wood Doctor]

Eh, I dunno, a $200 saw off craigslist, $50 for a Fiskars and another $50 for sledge and wedges. Then get a $500 truck after you've sold a few cords. Do the maintenance and repair yourself, and buy fuel and oil as needed. And about $500 in beer from all the aches and pains from swinging a maul for 8 hrs a day...

OK, Let's scale it back for a small operation:
Fixed Costs at Startup the First Year:
Truck ---> $1,500
Chain Saws ---> $500
Sledge and Wedges ---> $100
Equipment Maintenance and Repairs ---> $300
Fuel and Oil ---> $500
Advertising and Insurance ---> $100
Miscellaneous ---> $200
-----------------------
Total Annual Fixed Overhead ---> $3,200

Cords/year required to break even = $3,200 / $100 = 32

Now, you can start paying yourself a wage to buy groceries and beer when the 33rd cord is delivered.

 

[blackdoggy]

In my case I need to add in the cost of a vertical splitter rental ($40) and the cost per load for my wood which is $75 per load which ends up equaling three pickup truck loads @ $65 per load.

 

[Wood Doctor]

In my case I need to add in the cost of a vertical splitter rental ($40) and the cost per load for my wood which is $75 per load which ends up equaling three pickup truck loads @ $65 per load.

Note that the denominator of the break even is the difference between your price and the variable cost. I used $100 for simplicity.

So, you must add the $40 splitter rental + $75/cord for wood cost = $115. These are variable costs that go up per delivery. Your price would then be set at no less than $100 + $115 = $215 per cord to hold that margin.

I also tried to simplify the situation by including fuel and oil in fixed costs for a given year. That's somewhat erroneous because your deliveries will likely reduce or increase these amounts.

BTW, I can usually get a full cord of wood on two pickup truckloads. That's 64 cu. ft. per load. Consider sideboards similar to those shown in my avatar.

 

[blackdoggy]

Here we sell it by the hand thrown pickup truck load which comes out to roughly 3/4 cord for $65 (possibly $75 this year) I bring in three truck loads or more per turn and burn with my big truck @$75 per load.