Business questions..

[zopi]

Ok, here goes, I don't really know all the right questions to ask, but I am considering starting a small business custom sawing around the time i retire in 2011...I am figuring on it being a sideline or seasonal occupation, at least to start...work weekends and days off if you will..I can saw a log ok, and have become at least somewhat adept at reading them for best yield...but I don't really know anything about the business itself...there is one guy here in the county who saws, but he is bloody slow, and doesn't make himself very visible..not much of a salesman.

I am not too worried about the legal end of the business, as we are already under a corporate
umbrella (betcha didn't know I was a VP!) and my wife handles the taxes and bureaurats..

I guess my question is, what do I need to know about the custom sawing business before i jump out there?

[fishpharmer]

Zopi, good questions.  I have no answers.  I do have a question.  Do you plan on using your LT15? Or upgrade.  I only ask because you said the other guy is slow.  You might call WM and see how many WM mills are in your area.

[Magicman]

My business has been built on "word of mouth".  Being visable, and doing some "good will" work goes a long way.  Quality is what keeps customers and creates repeat work.

For me, being portable is my nitch.  Customers don't have to load and haul logs, and I don't have to unload and worry about slab and sawdust piles.  If a customer has 4 logs, I go and saw 4 logs.  I may not make much/anything on that job.  If he is satisfied, he'll have more next time.  I'd say that 75% of my work is repeat customers.  Virtually 100% is referred by previous customers.

If you started now, you should have a reasonable base built up within two years.  Working some weekends, etc. will get your name out.

[zopi]

Zopi, good questions.  I have no answers.  I do have a question.  Do you plan on using your LT15? Or upgrade.  I only ask because you said the other guy is slow.  You might call WM and see how many WM mills are in your area.

No, I intend to upgrade to an lt40hdg...I get better production with the
15 than he does with an lt30hyd...not that it really matters...he just doesn't get in a hurry...

[zopi]

My business has been built on "word of mouth".  Being visable, and doing some "good will" work goes a long way.  Quality is what keeps customers and creates repeat work.

For me, being portable is my nitch.  Customers don't have to load and haul logs, and I don't have to unload and worry about slab and sawdust piles.  If a customer has 4 logs, I go and saw 4 logs.  I may not make much/anything on that job.  If he is satisfied, he'll have more next time.  I'd say that 75% of my work is repeat customers.  Virtually 100% is referred by previous customers.

I've given thought to the portability nitch...I think it is the only thing that will
work here...whole lot of logging and timber industry, but not much in the way of local service...lotta big pine stands here...I can't help but think that some of that lumber should be used here...I'll have to get out and talk to a few local farmers...

Thanks for the relies so far!

[John Bartley]

Zopi,

It's really easy to make "business" be really complicated.

Here's the simple way.....

By "retirement" I assume you mean you will have an income of some sort and will not have to rely on your milling revenues to live? If so then the easiest way to "be in business" is just to start. Because you can afford to be without milling work (you have other income),  charge a bit more than anyone else around you, but do more than a bit better quality of work. Within a very short time, the word will be out that "he's a bit more expensive, but WOW, the work is excellent, and well worth the extra money". It won't be long afterwards that you'll have more work than you can handle, and because you aren't competing for the lowest bidder, you'll get to enjoy the best work......if you don't take bottom feeder jobs, you won't have to worry about bottom feeders dissing you when they don't get diamonds from lumps of coal.

How to be seen? .... put a small ad in the classifieds section of the local newspapers and just leave it there .....leave it there for week after boring week .... pay for a year in advance ..... it will pay for itself. Don't be flashy.... it'll be the "excellent work" that brings the business.

I focussed on homeowners and hobby farmers. They are enthusiastic, have lots of money, and are prepared to pay to get what they want. It took me less than a year to start turning away business at $60/hr by doing the above. As already said, the word of mouth started right after my first top quality job.

cheers

John

[paul case]

zopi,
i have neighbors like yours. in the last 16 months i have picked up alot of customers that took the ''neighbors'' some logs. my new customers gladly paid $.05 more to get the sawin done .one fellow told me that my ''neighbors'' told him that they could have his 4 logs cut up in 45 days or so. i drove past their mill and they only had 6 logs there. they have an lt40hd and my mill is manual. one man went to their mill and got his logs and brought to me!!
business cards. my wife makes my bc's an her computer on cardstock paper.best ad money we ever spent. cheap too. put them where landowners, farmers , ranchers and woodworkers go. i have one lumberyard that displays my bc's. feedstores and farm and home stores.  word of mouth works well and bc's add to this.some screening is mandatory. its pittiful but true, ive had some custom orders sawed out of their logs that they never came to pick up.$400 worth. sold it to someone else. i know that you want to be portable but the same rules apply.pay when finished is not the way some people think.maybe a contract. i think magicman uses one? being portable may make it hard for you to have anything to sell to recoup your expenses.
my advice   go for it . if you start as a sideline business now you will probably have a purdy good business by retirement time.pc

[MartyParsons]

We could do a equipment search in your zip code. What you would find is a # of mills. I get this ? some. My answer is how many do you know that are in operation. We get calls for sawyers and we get calls back and said the owners never called back or they were three months out. Return phone calls, show up on time and leave when the job is done or at the time was arranged and return the next day.  Communication is the key to business. 
Hope this helps.
Marty

[zopi]

Marty..did one  search when we bought the mill, abd there were only three mills in the area...wouldn't hurt i guess?

Thanks again guys!

[Magicman]

And, they very well might not be competitive to your business.  There are a dozen+ mills around me, and I have no competitors.  They all are either stationary, do poor quality work, or have screwed over folks.

Many of their former customers are now my customers.....

[pnyberg]

And, they very well might not be competitive to your business. 

I've got to agree with this.  I called Wood-Mizer to get the names and phone numbers of mill owners in my area.  I was depressed by the number of names they were able to give me, but when I followed up, I found that most would not be competitors for a new portable mill service. 

Oddly, they never mentioned the Wood-Mizer that would be my closest direct competitor, New England Saw & Lumber.

It's on my to-do list, once I actually get started, to make sure that my name and phone number get mentioned if someone in my area calls Wood-Mizer looking for a sawyer. 

--Peter

[Brucer]

When I started my part time business, I was up against a competitor who had been doing it for 10 years already. My plan was to work during the peak season and pick up over-flow work that he couldn't handle. I kind of overlooked the likelihood that he'd keep all the good jobs for himself and leave the nasty ones for me ... duh .

Here's how he did business ...

• Promise the customer that you'll meet whatever delivery date the customer wants, even when you know you can't.
• If you know a job is going to be late, wait until the customer calls before you say so.
• If you've promised a job by a certain date and a better-paying job comes up later, work on the better-paying job first.
• When the customer asks how much something will cost, size him/her up carefully and then throw out a number.
• If you quote low, wait until the customer is ready to pick up the wood before mentioning a price increase.
• If your competitors have lower prices than you do, tell them they really need to raise their prices or they'll soon go broke.
• You decide what quality the customer wants.
• Don't bother with proper book-keeping.
• When you're selling, round the prices up. When you're buying, round down.
• If you're losing money, avoid paying bills until the creditor starts to hound you. Plenty of folks won't bother to chase after you.
• If another business gives you a break, don't hesitate to take advantage of them.

Now I'm working full time, and he's picking up my leftovers .

[Magicman]

When I first went into business, there was one mill that was my biggest competitor.  He'd been sawing for at least 5 years.  Now.....I'm his......   He's asked me many times to send something his way if I couldn't get to it.  I never do....

[paul case]

competition is healthy. that way you can tell those who order and never pick up or pay that your too busy unless they pre pay or they could try so n so down the road  see if he is too busy.   pc

[crtreedude]

Some good advice here. Since you are VP, I guess you want to retire so you can be a president?   

Think of your reputation as capital, and more valuable than money too. If people know you are a man of your word and know what you are doing, they will come to you, even if you are a bit more. The ones who are only motivated by price will not be a loss, trust me. They are the ones that will drain the life out of you, wanting the best for nothing.