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How to start & operate your own firewood supply business
HOW TO START & OPERATE YOUR OWN FIREWOOD SUPPLY BUSINESS
Unpredictable fuel costs and the necessity of keeping warm in the
winter have resulted in "boom sales" for manufacturers of
wood-burning stoves. There has also been a return to the use of the
fireplace as a form of supplementary heat and as a luxury that
promotes the "cozy" atmosphere sought after by both middle class and
affluent families. This renaissance in the popularity of wood heat,
and upward spiraling sales of associated equipment, has created a
demand for firewood that's almost impossible to fulfill!
A very important element: This demand has caused the price of
firewood to almost double over the past several years. Whatever the
"going price" for a cord of firewood in your area, you can expect it
to increase by 20 to 30 percent each year for the next ten years or
Your potential market is a varied as the weather; it is also
somewhat dependent on the weather. You'll find buyers among
apartment dwellers as well as home owners. The rich are buying
firewood perhaps more than the poor; those concerned with the purity
of the environment and the so-called "voluntary-simplicity" folk
seeking a return to the "pioneering" life are all part of your
And don't think for a minute that firewood sales are limited to the
colder northern states. People living in Sunny Southern California
and along the Gulf of Mexico buy and burn firewood for the same
reasons as people living in Minnesota or Montana.
One of the secrets of success in this business is understanding why
the people in your area burn firewood. Then it's a matter of
learning when and how often they need it, and positioning yourself
to fill those needs.
It doesn't take special education or training to become a successful
firewood supplier. Just for the record, the backgrounds of people
operating businesses of this kind range from farmers to unemployed
factory workers to doctors, lawyers, real estate salesmen and even
The kind of equipment you'll need varies according to the type of
business you want to establish, and the kind of wood you will be
The first prerequisite to the establishment of your business is to
decide what kind of business - wholesale to retail outlets, or
retail to the general public - you want to operate.
Next, you'll have to decide on the type of firewood you will sell.
There are three major categories: l) mill ends or sawed up scrap
lumber and kindling, 2) whole logs for the buyer to cut according to
his own specifications, 3) fireplace and stove wood, cut and split
according to the general requirements of your market area.
Your next step is to line up a source of supply. Actually, it's
best to "lock in" a number of sources of supply. Later on, as your
business develops and grows, you may want to offer several different
kinds of firewood, that is, become a full-service dealer offering
firewood to meet everyone's needs and fancies for your area. We'll
discuss different categories of wood in demand, so that you can
explore sources of supply and costs.
MILL ENDS: Your best source of supply for this type of wood is the
sawmills in your area. If you live in a metropolitan area, take a
few weekend trips to the small towns in the wooded areas of your
state. With a little bit of initiative on our part, you should be
able to discover any number of small sawmill operations within a
200-mile radius of most metropolitan areas in this country. What
you'll want to do is buy a truckload of mill ends, take them home
and package them into sacks of firewood. Thus, a load of mill ends
that you might buy for $50 would be broken down into perhaps 200
sackfuls that you sell for $5 per sack. Multiply these 200 sacks of
firewood times $5 each, and you have a gross income of $1,000 for a
load of wood costing you only $50. You wouldn't have to be very
smart to realize that's pretty good, providing your sources of
supply can keep up with the demand.
The beauty of mill ends is that they are clean, burn easily and
fast, put out a lot of heat, and when broken down into sackfuls are
ideal for apartment dwellers, as well as people in warmer climates
needing firewood for just a few cold spells each winter. Until you
have a large full-service firewood supply operation, it's suggested
that you leave the sale of truckload supplies of mill ends to the
larger, more established fire wood suppliers. My advice here is
that you should stay within your capabilities of supplying the
buying demands of your market, and further concentrate on selling
what brings you the greatest profit. However, as your operation
grows, the supply of truck loads of mill end firewood is definitely
Other sources of supply for mill end lumber will be your local
lumber yards, wood working or furniture manufacturing firms, and
home building or remodeling contractors. In many instances, you can
offer to stop by these places about once a week and clean up the
worksite by hauling away the scrap lumber, and they'll let you have
it without cost. It is possible to even get paid for doing this.
The only drawback will be that you'll have to sort this wood, and
then saw it up into the sizes you want for your bundles or sacks.
This is no big deal, because you can handle a pickup or trailer load
with a power saw in just a couple of hours.
When you have the wood ready to package into sacks, you'll save time
and in crease your profits by hiring a couple of high school
students. Contact the counselors at one of the local high schools,
explain that you need a couple of students for part time work
sacking firewood, and you'll have all the help you need.
As for how much to pay them, establish a pay rate for 100 full
sacks. Of two high school students, one would hold open a sack
while the other uses a scoop shovel to pick up the wood and dump it
into the sack. Between them, they can gather the top of the sack
and tie it with twine. The full sacks, of course, must be stacked
on a pallet or in an area ready for selling. Check the time it
takes two good students, working at a reasonably fast clip, to load
100 sacks. Knowing the current minimum hourly wage rate, you can
then determine the labor value of 100 loaded sacks.
For a supply of burlap bags for use in sacking your wood, check with
a farmers' feed store. If you buy in quantity, you can get them at
a very reasonable price. You can purchase twine for tying the sacks
at the same place.
WHOLE LOGS: Many people have chain saws and fancy themselves as
"do-it-yourselfers," but they don't have the time to go out into the
woods and bring back firewood. If you can supply these people with
a location not too far from home, where they can saw and split their
own firewood, you'll have a steady stream of customers. You'll need
a large vacant lot - about a half acre to a full acre - and
preferably on the outskirts of town. The first thing will be to put
up a 6-foot cyclone fence around your lot, and then a small garden
shed type building to serve as your office.
Contact a sawmill or logging operation not too far from where you
want to open your business. Arrange with them to deliver whole logs
(lumber rejects) to your wood lot. Your costs shouldn't run much
more than $10 per log, even for premium wood, but will depend upon
the size and number delivered in each load.
If you have the vehicle and the energy, you can also contact the
Forest Service or the Bureau of Land Management in your area for a
permit to Cut firewood in government preservation areas. Then you go
out into the woods, saw up downed tree s into eight-foot lengths,
load them into your vehicle and haul them to your woodlot.
Still another source of supply is the farmers in your area. Talk
with them and offer to "thin out" areas of standing timber, and the
downed trees. Oftentimes, you can get this wood at no cost other
than offering the land owner a share of the timber you take out. He
may even consider your "thinning" and hauling an even exchange for
Don't forget about the road building construction companies, and
commercial and residential developers as sources of supply.
Actually, once you get into this business, you'll find sources of
supply virtually unlimited, and restricted only by your own
initiative in making contact with the property owners.
Once you have a supply of logs within your wood lot, there are many
things you can do to attract customers. Run an advertisement in
your local paper inviting "do-it-yourselfers" to come out and cut
their own firewood. You charge them twice as much per log as your
cost, and they do the sawing, the splitting, the loading and provide
their own car or truck to take them home. You are there only to
supervise and receive payment.
You could also rent chain saws, axes, and the use of your power
splitter. Allow the customer to select the log of his choice, and
then have the hired help - high school students, perhaps - who would
saw, split and load this wood into the buyer's vehicle. The
ultimate, of course, would be to include delivery and stacking of
this wood at the customer's residence.
Once the customer has selected his log - at twice your cost and pays
you $5 for sawing it into the lengths he wants, plus $10 for
splitting it for him and another $10 for loading it onto his
vehicle, you're talking about $150 to $200 per cord of wood. The
secret here is to have your helpers working in teams, with the kind
of efficiency that means $l00 per hour for you.
FIREPLACE AND STOVE WOOD: In running a program of pre-cut and split
fire place and stove wood, you combine all the principles we've
discussed so far, into either a wholesale or retail firewood supply
The easiest and most profitable operating procedure is to set up a
wood lot where whole logs are delivered to your location. Part-time
workers saw these logs into 16 to 24 inch lengths for you. A couple
of people with chain saws should be able to cut two cords of wood
per hour. A couple of people working a power log splitter should be
able to keep up with the people on the chain saws. And a couple of
other people stacking this wood onto pallets as it's split, or for
storage until sold, would be all the help you need.
If you can set your business up along these lines, you'll realize
the greatest profits and not have to get involved in the physical
part of the business. The big thing to remember is that - as the
business owner and operator - your time should be devoted to selling
the end product.
If you decide to be a wholesale supplier, and sell to retailers,
advertise for and hire commission sales people to call on the retail
outlets in your area. You'll need help in covering all the possible
opportunities for retail sales of your firewood.
You should be selling sacks and pallet loads of firewood. Remember:
The more you can divide a basic cord of firewood into sacks or
pallet loads, the greater profit you're going to make from each cord
of wood you sell.
You'll find most people buying cords or truck-load quantities of
firewood before cold weather sets in, and after that, people will
buy in quantities only large enough to get by, or to last out a
sudden cold snap. If you should also sell bags and pallets of wood
to the general public, after setting up retail sales outlets, be
sure that your prices at least "average" those being charged by the
retail sellers. Never "under-cut" the price your retail people are
If you decide to do all the selling yourself - in other words, act
as your own retail outlet - you'll need to advertise.
Start out with a large three-column wide, by four-inch deep display
ad in your local paper. Unless you've had advertising experience,
at least contact the advertising instruction class at your local
community college for help in the layout and writing of this ad. If
you're not far from a large metropolitan area, you can often contact
the advertising agencies in that area, and get free-lance help to
assist in the makeup of your advertising.
Plan the appearance of this ad for a Saturday morning paper. Make
your opening a big event - much the same as a grand opening or
special anniversary sale - with free coffee, donuts and balloons for
the children. Ideally, the opening of this kind of business should
be staged on a weekend in late September or early October, and
designed to acquaint the people in your area with your firewood
Get the name, address and phone number of everyone who shows up.
This can be handled very unobtrusively by giving away free prizes
requiring the attendees to your event to fill out simple prize
drawing forms. The prizes can be a free cord of wood, dinner for
two at a local restaurant, or even movie passes.
The whole purpose of your grand opening show is to let people know
that you're open to serve their needs; to get them to discover your
location; and to implant in their minds the memory that you can
supply them with the means to keep warm when the weather turns cold.
Quite naturally, many will find your services to be more convenient,
time-saving and less bother than whatever methods they're currently
using. As you talk with your customers, listen to their
"complaints" about their present methods of fire wood procurement,
and then alleviate those problems with the services you provide.
After your grand opening, a small 2 by 4 inches display ad in the
yellow pages of your telephone directory plus the posting of
advertising circulars and business cards left with woodstove and
fireplace suppliers, insulation and remodeling contractors and
lumber yards in your area is about all the advertising you'll need
to do. However, it would be wise to follow the lead of the "snow
tire" people, and whenever the weather forecast shows a cold front
or winter storm moving in, again invest some money in radio and
Statistics prove that 20 percent of your potential market will
prepare for cold weather by purchasing before the cold weather sets
in. Another 30 percent of the market will wait until the first cold
snap hits, then buy from the first supplier that comes to mind.
Finally, the remaining people will have to be "sold" via suggestion
of the benefits your business provides.
This is the period when you begin profiting from those names,
addresses and telephone numbers of people who turned out for your
big opening event. Simply set up a telephone selling program
utilizing the services of commission telephone salespeople, and
follow up on those who had registered.
You can conceivably operate this business from your home or
backyard, and definitely on a part-time basis, but the prospects of
immediate success, with outstanding profits are so great that it
would be wise to plan on a big operation from the start.
A receipt pad for taking orders, a "daily diary" or ledger type of
bookkeeping system, a calculator and a telephone should suffice for
office supplies and equipment. Until you're over the hump on the
profit side, you can keep your sales receipts in a shoebox or daily
staple together and store in chronological order.
A couple of other points to remember: Hardwood burns the longest
and gives off the most heat; firewood that has been cut in the
spring and seasoned through the sum mer is the kind most people will
be willing to pay premium prices for; and giving the customer a
"little extra" for his money will result in greater and
longer-lasting success than quick profit schemes.
Once you've got your basic firewood supply business on a profitable
basis and running smoothly, you'll find your facilities and business
expertise ideally suited to adding extra profit producing lines such
as the sale of firewood accessories, woodstoves, built-in
fireplaces, home insulation or weatherizing services, recycling and
perhaps even home remodeling.
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