Profit

[benedmonds]

4 hours ago, Big J said:

Agreed..... it really doesn't make any sense.

 

 

Especially when you add the stove installation costs mine was about £5,000 and ongoing maintenance, sweeping etc....  

 

BUT I would still love my stove 

[Acerforestry]

All aforementioned posts concerning the lower end of the scale, sideline aspect ring very true to me - if you are fortunate enough to bring in a fair few tons of arisings (or have some other means of getting the wood free) over the year and therefore have no outlay on the timber, then it works, in my view. But buying artic loads in whilst trying to run an arb or forestry business simultaneously, at the prices that these loads are these days - no. Too expensive, too time consuming

[neiln]

From everything I read on here I can't see any body getting rich in firewood!

 

For a hobbyist like silverhooker and Ratman you can make yourself smile as you work out what you save on heating, I'm in this boat.  Like them I do it for fun and exercise, and doing 12-14 m³ a year is fun to cut and split but more would not!  Even those 12-14 wouldn't be fun if I had to do it, but since I can choose if, can and when, it is fun.  2 stoves, self installed with liners in the flues, sweep my own flues, factor in consumables ( mainly petrol collecting the logs), the 2 chainsaws, axes, mauls, hatchet, ppe... I've got to burn about 45m³ to save enough gas to be in profit. With what I burn and supplying mum then I'm even in 5 years.... That's 2 more.... So I'm even by the time I've burnt what I have CSS in the garden.  This only works as I've befriended a local tree guy and I get all my wood for free.  He gets his arisings to disappear, I get 65% hardwood and the rest soft.  Now if I could just sell  a cube to neighbours in garden centre size sackfuls at their prices...I worked out that's about £250/m³

[Woodworks]

I am surprised more small-time setups don't just get someone in with a processor. Another of my customers collects arisings and gets me in as and when. We knocked out 18m3 vented bags last time and cost him just a tad over £300 for me and the wood is free. No messing around with maintaining, storing and financing all the kit. And no offense but someone like myself who does this day in day out with a good machine is so much more productive than messing about with slow splitters etc.

[arboriculturist]

Generally arb arisings are all shapes and sizes and don't lend themselves to a processor and in reality there are very few mobile setups around. I think the 'get in a contractor' is great for domestic customers and the bloke doing a small amount to sell, but without a log deck output is down by at least 50%. If you have bought in roundwood to handle without a grab of some sort it's murder.

 

Having started the hard way and built up the equipment, I can say with certainty that even with all the gear making a significant PROFIT is hard to achieve. With 2 people, given the right spec. timber we can load deck, process and stack 15m3 of crated 10" logs per hour and keep the setup tidy. Even with this level of production making  a worthwhile PROFIT is still a challenge. We never handle the logs during any part of the process, so how anyone doing a few 100 metres manually can survive is beyond me and in reality they must be just surviving.

 

The Firewood sector is surely going the same way as farming, we will see far far less producers, as the  larger setups will be the only financially viable standalone businesses.

 

Talking to the timber Hauliers, at least 6 producers within 75 miles of me have ceased their Firewood businesses in the last 9 months.

Edited May 27, 2019 by arboriculturist

[neiln]

7 hours ago, Woodworks said:

I am surprised more small-time setups don't just get someone in with a processor. Another of my customers collects arisings and gets me in as and when. We knocked out 18m3 vented bags last time and cost him just a tad over £300 for me and the wood is free. No messing around with maintaining, storing and financing all the kit. And no offense but someone like myself who does this day in day out with a good machine is so much more productive than messing about with slow splitters etc.

Not looked into it, but I doubt there are many processors for hire in zone 3 London.  I do it for the fun though.

[ash_smith123]

Generally arb arisings are all shapes and sizes and don't lend themselves to a processor and in reality there are very few mobile setups around. I think the 'get in a contractor' is great for domestic customers and the bloke doing a small amount to sell, but without a log deck output is down by at least 50%. If you have bought in roundwood to handle without a grab of some sort it's murder.
 
Having started the hard way and built up the equipment, I can say with certainty that even with all the gear making a significant PROFIT is hard to achieve. With 2 people, given the right spec. timber we can load deck, process and stack 15m3 of crated 10" logs per hour and keep the setup tidy. Even with this level of production making  a worthwhile PROFIT is still a challenge. We never handle the logs during any part of the process, so how anyone doing a few 100 metres manually can survive is beyond me and in reality they must be just surviving.
 
The Firewood sector is surely going the same way as farming, we will see far far less producers, as the  larger setups will be the only financially viable standalone businesses.
 
Talking to the timber Hauliers, at least 6 producers within 75 miles of me have ceased their Firewood businesses in the last 9 months.

You're bang on.
We started with a £6000 investment both working full time. Having to pay rent and finance any bit of mechinery we needed and built it from there but like you say even now having all the gear pretty much paid for it's still hard to make a tidy profit only doing firewood.
I look at the 3/4 decent sized firewood producers in a 30 mile radius from us that have started up since we started and they are all on farms with massive investments (one in the region of £750k in biomass boilers and firewood equipment in the last 2 years) and I just don't know how they think they will make enough money to pay for the equipment let alone any wage. One thing is though they are all on daddy's farm, with daddy's tractor, telehandler, no rent, no business rates, insurance already payed for, woodland on the land and as much land as they want for storage. We are looking to move into a slightly bigger unit/yard and there isn't anything available in the size we need for under £50k a year rent and rates. So I can see when you take all the above out of your monthly outgoings you might actually make a profit not doing too much firewood on daddy's farm.

[arboriculturist]

On 23/05/2019 at 20:33, 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.

A profit of 27% would be diabolical were you an Electrician with just a van full of tools but when you talk about the timber / forestry sector it is of course a whole different ball game. With machines and equipment costing 10s of thousands then the figure of 27% net profit is looking much more realistic. Taking a look at your accounts generally demonstrates how the business is running and I know in the past our net profit has been well below that figure!

[monkeybusiness]

On 27/05/2019 at 17:31, ash_smith123 said:

You're bang on.
We started with a £6000 investment both working full time. Having to pay rent and finance any bit of mechinery we needed and built it from there but like you say even now having all the gear pretty much paid for it's still hard to make a tidy profit only doing firewood.
I look at the 3/4 decent sized firewood producers in a 30 mile radius from us that have started up since we started and they are all on farms with massive investments (one in the region of £750k in biomass boilers and firewood equipment in the last 2 years) and I just don't know how they think they will make enough money to pay for the equipment let alone any wage. One thing is though they are all on daddy's farm, with daddy's tractor, telehandler, no rent, no business rates, insurance already payed for, woodland on the land and as much land as they want for storage. We are looking to move into a slightly bigger unit/yard and there isn't anything available in the size we need for under £50k a year rent and rates. So I can see when you take all the above out of your monthly outgoings you might actually make a profit not doing too much firewood on daddy's farm.

I bet there are grants involved somehow on investments of that scale

[gdh]

1 hour ago, monkeybusiness said:

I bet there are grants involved somehow on investments of that scale

Not sure about the rest of the UK but there's been a lot of grants the last few years in Wales. Usually around 40% so the chances are pretty good they've had one. 

 

We've gone for 2 in the last 10 years and they're obviously a big help but I'm not sure I would go through it again - the paperwork is horrendous as an understatement and there's a lot of conditions attached; you have to create a job, machinery has to be new, multiple quotes through specific websites, keep everything for 5 years etc. On top of that we had to start a separate business as agriculture is exempt and there's still a couple of loans to pay off.

 

Obviously that's no issue though, life is easy on 'Daddys farm'