Learning to hate inventory

[kderby]

I thought I had an advantage over a local friendly competitor/sawyer.  I have been building an inventory.  I wanted to say "Yes Sir!, I have your lumber in stock and ready for installation."  Now, I find this is not working.  The lumber business is like the bakery business.  The customer wants fresh white bread (pine) when your shelves are full of wheat bread (doug fir).  Who can sell stale and moldy bread at a profit?  The lumber gets gray and stained while it dries.  Lumber moves while it dries.  Did you ever try to get a good price for streaked and warped lumber.  I am a simple, rough sawn mill in the countryside so the lumber has to be cheap...right?  I now see the wisdom of my "competition."  He mills, then the customer pays and goes home with the trailer of lumber.     

I am considering how to do more custom milling.  I am definitely narrowing my species list.  I am no longer going to mill dimension lumber (2x8, 1x12) before I have an order and money up front.

So here is the question at the end of the long and whining post:

Any ideas out there on inventory management?  Does it work to carry a narrow "core product" inventory?   

Thanks

KDerby

[Bibbyman]

I feel your pain.  We have some lumber that goes back 16 years to the year we started sawing.  We filled a 30x60 shed with lumber and still would not have what people wanted.  Even though it had been sticked and air dried and under roof, it had turned gray and most customers think it should look bright as store bought.

In the last few years we have tried hard to ship everything out green off the mill.  What don’t fit a customer’s orders goes into flooring lumber.   For example, yesterday morning I sawed out 30 8’ 2x6s for a cousin down the road.   I picked small logs that would just make 5-7 2x6s.  But you can’t just make 2x6s unless you make heavy slabs.  I was able to pull about 100 bf of 4/4 oak flooring lumber boards off the sides.  These will keep a couple of days until we can combine them into a bundle going to the flooring factory.  Nothing stays home.

After these years of making a concerted effort to “keep things moving”, we have freed up about half the 30x60 shed.  Some of it we did manage to sell and some of it just got sorted out and went to the slab pile. 

[Ron Wenrich]

We're more on the commercial side than those on this forum.  We rarely saw anything that doesn't have a market.  The exceptions have always been side lumber from species we don't normally market.  Those are black locust and hemlock.  Most of it eventually sells.

We also would saw our white pine into cabin stock and the rest into boards for tongue and groove.  Some of that stuff sat for a long time, and we even went through the process of getting it milled.  We stopped doing that years ago.  Pine gets sawed for a local timber framer, even though his money is slow and it sits in our yard to dry.

We sell a lot to commercial wholesalers to keep stock moving.  We don't dry anything, as its not wanted on the other end.  We saw our low grade into pallet stock and blocking.  But, we are in a hardwood area, and not in competition with those highspeed dimension mills you have on the West Coast.

[Magicman]

kderby,  for dimension framing lumber, I saw full 12" wide and sticker it.  When it's known what actual size is needed, I stand it up on the deck, take a thin cut, flip it over, and then saw the needed 2X4's, 2X6's, etc.  Since you are then sawing seasoned lumber, there will virtually be no crown.

Your (and others) inventory frustration is why I buy no logs and sell no lumber.  The only exception is when I get free logs.

Custom sawing only.

[Kansas]

I am curious about something. why would you have all the staining and streaking? Was it just around the stickers or the whole board? I don't know what all your potential markets are, and if its necessary to dry all the wood to reach those markets. But I would think if you got some really sweet logs of those species and could at least air dry some good 1 and 2" lumber, you could get a premium. The woodworkers on this forum should be able to tell you what some good clear white pine and fir would be worth. I wouldn't completely give up on the idea.

[Brucer]

Well, I've been custom sawing for 5 years now, supplying timber framers and contractors. I've got accurate records of what I've cut and for who. I've pushed the numbers into a database so I can analyze them every which way. And I still can't predict who's going to want what.

One thing I decided when I started buying my own logs was to stick to one species -- Douglas-Fir. Most customers want it for timber-frame work. It doesn't decay or discolour quickly (unlike Pine). And you can spot most internal defects before you saw -- or buy -- the log (unlike WRC).

I only saw to order -- mainly timbers. But there is always the issue of what to do with the side lumber. I have enough trouble disposing of slabs -- not allowed to torch them due to municipal bylaws -- so cutting thick slabs is out. Can't compete with stud mills, so 2x is out. That leaves me sawing 1x material off the sides. But what to do with it?

What I've found is that I can collect side lumber for 2 or 3 years before someone comes along looking for board-and-batten siding or wanting to build a fence. Then in a blink I'm out. So trim it, stack & sticker, and cover with lumber tarp ... and wait.

Due to space issues I eventually decided that I'm only stocking 9 types of 1x -- 4", 6", and 8" in lengths of 8', 10', and 12'. If someone wants something different, it's a custom order.

[kderby]

Thanks for the comments!  Each of you, from varied markets and perspectives make good points for me to ponder. 

Kansas in answer to your question, the stain/streaking I refer to is surface oxidation and some rain marks while the drying was in process.  A quick trip through the planer and it is bright again.  I see more interest in the bright "fresh sawn" look.

Brucer, when I buy fir logs, I tell my wife..."fir sells!"  We westerners are blessed with a superb species.

I mentioned narrowing my species list.  I have milled lots of interesting logs.  I call it my sawmilling tuition.  In order to stay in the game I will now focus on Juniper.  I can be special and the price pressure is not severe.  I want to follow the pattern of the eastern red cedar focused mills.  A mom and pop sawmill turning out western juniper lumber.

Arky, how is your yard full of lumber doing?  I wonder if Cedarman carries a shed half full of old lumber like Bibbyman and Kderby do?

Thanks Y'all

Kderby     

[Meadows Miller]

Gday

My view has always been that if its in your yard its costing you money and if your running a drying operation ou want it dryed dressed and out the gate in as short a lead time as possible this goes for log stock piles and anything else that ties up your working capital An empty mill yards a good yard aslong as you have logs coming in a timber going out 


Regards Chris

[Cedarman]

kderby, we have lots of stacks of lumber.  Large volumes of 5/8 x 3 1/2, and 4" x 4',6' and 8'.  This is side lumber from logs we saw for custom orders.  We sticker this and wait for fence companies or we can run for T&G.  It is good in the stack for up to 10 years .   We have quite a bit of low grade we dry to make shavings to make sawdust that brings 500 to 1000 per ton.  There is a bunch of odds and ends laying about waiting for a customer to call.   I don't need a shed to store lumber , but do keep quite a bit under roof.   One item is 2x that has lots of clear wood that gets resawn for flute makers.  It is worth 43 bucks a ton as mulch, so that is the bottom of what it is worth.
You cannot predict the stuff people will order, although 1x6x8 is the most common.  When someone calls wanting to know how much we get for our cedar, I say it is like calling Wal-Mart and asking what they get for their clothes.

[ely]

i like that saying cedarman, i have sawn for several years now and i have several sheds full of various species of lumber. it is for my personal use and not for sale. i saw for many customers each year that see the old dry lumber and ask what the price is on that wood. i look at them and politely tell them they do not have enough cash to purchase that wood. they usually wait until i saw out their order. i did have one idividual insist that he had plenty of money to buy any of my wood.... took him about 30 minutes to convince me of it. i stood corrected... i was the fat guy standing in the driveway looking corrected with the big wad of cash in his pocket.

[Tom]

I just had a man give me small change for "special wood for me" that I've had in my barn for years.  the stacks had boards on the bottom dated 1991.  I was pleased to see him take it. It had gotten powder post beetle in it and the interior of the boards were gone and the exteriors were riddled with holes. 

He was pleased because he was making bee hives.  there was enough solid wood for his use and the bees will seal the inside, while he paints the outside.   It's probably a good use, but he will be the only one around with such a varied assortment of wood species.

The stuff seems like it is going to last forever and then, one day, whoosh!, it's gone.  It saddens me a bit to realize that I could have used that space for better enjoyment through the years.

[carykong]

I saw mostly for myself but do make an occassional sale. I,too, never saw boards for "inventory."  All my boards are destined for my home or shed construction or pre-sold. I do,however,slab plenty of logs that are not sold. I leave the logs as a square in my field. I elevevate the squares in my field,seal with old diluted latex or water seal,and cover. This unsold inventory of squares allowes the wood to cure a bit and is less prone to rot than a log. When I need the boards,I return the square to the mill,cut off the sun and water damange with a thin cut and start making boards that are clean and dry fast after sticking.

[ARKANSAWYER]

 




  I have lumber stacked all over 30 acres.  Most of the time I have between 30 to 50 mbdft of lumber on hand in oak, cedar, pine and walnut plus others.  Then a guy comes in and wants 120ea 1x6x8' pine boards and I have less then 10 on hand.  It never fails.  What ever I do not have is what they want.  I sell the gray wood just as fast as the fresh wood.  Some times I get more for it.  Making some buckshot denim pine right now becasue last winter I sold it all and was out of stock till I could make some more this summer.
  I can take an old rough gray weatherd board and stick it into the LOGOSOL and charge 3x's as much for it.  It is a very magical machine.

[Captain]

I much prefer to be a sawmill than a lumberyard.  I never have the right stuff on hand.

Captain

[Ironwood]

I LOVE inventory. I mill for myself, and have lots around, and then someone shows up to buy "my" wood. Works for me. I dont do dimensional though so it is a different animal, BUT it does take effort and maintanence to keep it well.

 Ironwood

[woodmills1]

my inventory is only the leftovers from other jobs.  Some of it dates to 2 days after I bought the first woodmizer.  I now try to add the leftovers to the sale,  as in you wanted 300 feet of quartered maple, so why not take this whole pile of quarter cut for 50 more and separate the true quarted later at your own time.  anyone want a thousand feet of rift sawn narrow oak I made good money on the non leftovers.

[Cedarman]

I found me a sucker today.  Fellow came after 22   3 1/2 x 3 1/2 cedar posts for turning stock.  I let him sort to get the pieces he needed and he paid a very nice premium.    I had a little pile of 3 1/2"  x 3/4" lumber 4 and 6 ' long.  About 15 squre feet that we had planed and prepared for shipment only to realize we didn't have the spces right.  Our screw up.Customer wanted clear and this knotty cedar.  So I offered him the pile for $10 bucks.  He whipped his wallet out and the deal was done.  I sure suckered him .  There were no stacks that those board would fit in and they would have sat around and who knows what.  I swear he was chuckling to himself as he headed to his truck with his nice stack of lumber.  Inventory reduction plan in full action.

[paul case]

go cedarman go,
money in hand and lumber on the move
pc