Profit

[Chris Reeve]

Hi guys.

 

Due to the increasing price of timber is the log business beginning to become more of a side line for people rather than a full time job? My main job is landscape gardening etc but wanting to do less of this and focus more on the firewood instead but is it worth the switch due to running cost and the price of timber increasing if you can find it [emoji17] ? I roughly sell 150 ton a year. Any opinions would be gratefully received. Cheers

 

[Woodworks]

We are just putting our prices up and seeing what happens. If sales fall through the floor then we will look at other options. We are paying around £15 a tonne more than 4 years ago so it's not a killer IMO. When you look at all the work involved in getting wood grown and delivered to the door it could be argued wood was far too cheap before. 

[Chris Reeve]

Cheers. How much timber do you shift a year? Is it a full time business for you?

[Steve Bullman]

For me the reverse was true. When I was getting wood for free or cheap it was a good little earner on the side. When prices started rising around 10 years ago it killed it for me. I was only doing around 80-100 ton a year and realised for it to be a viable business I would need to be selling an awful lot more than that

[Chris Reeve]

For me the reverse was true. When I was getting wood for free or cheap it was a good little earner on the side. When prices started rising around 10 years ago it killed it for me. I was only doing around 80-100 ton a year and realised for it to be a viable business I would need to be selling an awful lot more than that

Yeah it is a funny old game.

[Mick Dempsey]

7 minutes ago, Big J said:

Producing and selling firewood is only really viable if you are one end of the spectrum or the other. It works well for someone with a transit, a chainsaw and a splitter. Very low overheads and earns some beer money.

 

Or if you are on the other end, with a very fast highly automated processor, loads of space/kilns for drying and an efficient delivery method. You want to be processing upwards of 1000t/year really. 

 

It's the folk inbetween where I don't know how they do it. Not enough to live on really, but enough to require significant investment in machinery, stock and yard space.

 

Firewood is selling the unprofitable to the ungrateful, and it's worth remembering that. 

 

As regards, profit, someone once said to me to aim for your business to be 27% profitable after all day to day costs. It seemed like an arbitrary figure at the time, but over the years, it's rung true. So on that basis, you need to be turning over £100k on firewood for a £27k salary. Doesn't seem worth it to me, to be honest.

I guess the only way to make it worthwhile is C.A.S.H

[Ian C]

I gave up firewood last year, there’s simply too many at it doing it as a sideline to make it worthwhile, buy the time I had taken labour, fuel, diesel for the tractor, delivery costs from £85 a bag it wasn’t worth the effort, I now send it for biomass and make far more from chip for v little effort

[Woodworks]

4 hours ago, Chris Reeve said:

Cheers. How much timber do you shift a year? Is it a full time business for you?

Not a lot at around 300 cubes and that is my main income. I do some processing for others and live on a completely unprofitable smallholding and fit kitchens when desperate. Don't earn what most would call a living but we get by as we live cheap and have low overheads. It's a lifestyle, not a profitable job but I love it.

[oldwoodcutter]

I gave up firewood 3 years ago. A friend and quite a big player with his finger in lots of pies, orders in 1000 ton a year, still runs out, but he’s unsure whether the labour and equipment he’s got tied up in it, is really worth bothering with another year.

[gdh]

As said above it's hard to be in the middle, you can make money on a small scale by getting cheap/free wood from other jobs. I think more people are realising the value of wood now but that's another discussion. 

 

You can also make money on a larger scale but it's very difficult with constant price rises on inputs and sourcing timber. 

 

You can do a surprising amount with a chainsaw and splitter but to go into the hundreds of tons you need to start thinking about machinery and that's where the costs start to rocket... You start with a processor but that needs a tractor to power it, it's quicker with a loader so you get one of those, then you want a forwarding trailer to get logs in so you want a bigger tractor for the road. Then you need more storage space so you buy ibcs, they get wet so you build a shed which can't hold enough so you get a kiln which is heated by chip so you get a chipper which needs a second tractor by which point your processor needs replacing.. 

 

My vague point is there's still money to be made if you expand but not a lot and where do you stop? ?

 

Firewood is our main business by the way and it's getting harder but we've no plans to stop in the immediate future.