Where are the Angels?

[ARKANSAWYER]

  I am not talking about those creatures of GOD like Michael or Gabe nor am I talking about that one on the Victoria's Secret commercials.  I am talking about these mythical beings called Angel Investors.
  I have heard rummors of such things that invest in companies and share not only their money, but wisdom and experiance.  So I went looking and could not find such beings.  While the internet promised to link me to such as I sought after, the search proved futile.   I think looking for a unicorn or buying a lottery ticket would be faster and more productive.  I did however uncover some sharks in angel suits and some very unscrupulous cons who promised to be angel investors.
  Now I am sure that out there somewhere some dear sweet soul felt pitty and helped some struggling entrepreneur and thus the term was coined "Angel Investor".  I know some people helped Sam Walton, Don Tyson and Forrest Wood make it through the hard times.  There are people who are well off who give away millions of dollars every year but do not take the time to pay it forward.  I am proud of Bill Gates and Steve Jobs because they give hope to us poor slobs still mucking it out in the ditches.  If I was Goldman Sachs or GE the GOV would have given me billions to bail me out.  But no! I am deemed unworthy of the brass ring. Yet I see I am in good company of the hords of failures who pave the way before me. 
  Some days I just feel like the horse with the carrot hanging just out of reach and thinking that if I keep walking I will get that carrot someday.  It is just the depression that comes along each day after about the eighth or tenth call when I have to turn down the job because I just can not get to it because I am to small or do not have the capital to take advantage of the offer.  I do what I can and wait for them to come and pick it up so I can start again.  Just as I get to the ball to kick it, Lucy jerks it away and I land flat on my back, again.  But what hope is there for some poor white southern trash male child to ever make it to the big time.  For I was never promised another day much less another breath so why should I seek for more then what I am?  It seems that while honesty may help get you into heaven it will kill you in business and politics.
  So if you are standing there looking at the carrot and you hear the phrase "Angel Investor" the theme from "Jaws" should start playing in the background and beware of the shark's fin between the angel's wings.  And should you have an angel in your pocket and are done with it I would be interested in borrowing them for a spell.  May the Grace of GOD be with you and yours and I guess I will see my angel on the other side of the pearly gates.

[jim king]

I had a guardian angel at one time, but my little devil got him drunk, tattooed, and left him penniless at a strip club. I have not had another angel assigned to me yet.

[DanG]

Keep following that carrot, Arkey.  By and by there will be a bush beside the road that you might be able to snag it on and get a bite of it.

How about putting Wanda back on the road?  What about doing a little logging yourself to get the logs you can't afford to buy?  Cut on shares if you have to, anything to survive.

[Autocar]

Arkansawer just get up and start again , there was a logging show years ago I believe the name of it was Never Give A Inch ya just have to hang in there and keep climbing the hill you work hard enough your get to the top . When I was younger I looked at the bigger operators and said to myself I want to go that far. But I worked hard ,worked with old equipment and tried to be fair to everyone I did business with. Now I am past sixty, I never did become that big operator but realize theres a whole lot more to life then being the top dog. I get phone calls about timber and there remark they were told I did a good job and was fair with the payment. To me I did ok ,hang in there your your make   At least when you look at yourself in the mirrow your feel good about the guy looking back at you

[Brad_S.]

I feel your pain Arky and especially relate to the carrot on the stick analogy. I followed that sawmill carrot for 16 years and all I have to show for it is some tired iron, a shattered marriage, a beat up body and basket full of broken dreams. My angel showed up just as I was going under for the third time.....not with investment money but with an opportunity that allowed me to finally...reluctantly...give up my chase for that carrot.
Finally letting that carrot go was hard but my stress level is way down. My debt has gone from a 6 figure number to nearly nothing. I gave up a lot but life is much easier now.
You sound as if you are approaching that crossroad I was at earlier. I wish you well in your ultimate decision.

[Ironwood]

Brad, you should explain your picture, looks like your in the rotor of a 300' windmill with blades on each side and a nice harness. ? Is this part of your angel? 

 Ironwood 

[red oaks lumber]

arkey,
 the angels are in your pocket, it's just that the devilish angels are talking louder than the good angels.last year 2010 my additude was very poor at best, you know the kind every bird could poop on the lower lip cause i was pouting in my self pity. buisness sucks , the economy is poor, the gover't sucks ect. so on the new year i thought i will try to look at things with a posative mind set.
 man how things can change quickly, the phone is ringing (customers not creditors) people are coming by the shop ordering product , life's looking up . the only thing changed from that friday to that monday was my additude.
    

[Ironwood]

Arky,

 I think angels are out there but are looking into less "hands on businesses" where exponential returns are possible. This is unlikely in traditional businesses, and traditional business models. So that leaves us out.   But they always want a piece. Call it the "cost of capital".

 Ironwood

[jim king]

ARKANSAWYER :

Check this out.  This is what I am and it is no joke but a couple of pills a day makes you a different person.  I am not doctorb but you sound familiar to me.

One day my neighbor who is a doctor took me to the local crazy house and the doc looked at me and we talked for a while and he told me I was crazy and gave me some Lithium and life is much easier.

No smart remarks guys 
http://en.wikipedia.org/wiki/Bipolar_disorder

[DanG]

Arkey, maybe there are Angels out there, but just not the kind you're looking for.  The so-called Investor Angels are a lot like those lawyers who advertise on tv.  They promise you that they will stand behind you and fight for you, but all they want is a big chunk of your settlement for doing nothing but selling you down the river.

The reason I say there may be Angels of another sort?  I was offline for a couple of hours and when I returned it only took me a few minutes to view everything that had been said on the Forum, so I took a look at Facebook.  One of my Nieces had just posted a little quote that may be meaningful:

"It's impossible." said pride.
"It's risky." said experience.
"It's pointless." said reason.
"Give it a try." whispered the heart.

[jim king]

"It's impossible." said pride.
"It's risky." said experience.
"It's pointless." said reason.
"Give it a try." whispered the heart

The only thing she forgot  "I got it done"

Thats good

[Tom]

Arky is cool.  He is balancing a poor economy against an intimidated bank.  He has log suppliers who are in the same fix as he is and all of them are picking up crumbs to make it to a better day.

He managed to put together a bunch of stationary equipment on a new piece of land and has had the banks behind him, though he is towing them rather than them pushing.  Things are rough all over, especially on the level at which he is operating.  I've got faith that he has the perseverance to pull the fat out of the fire.

Mark my words, If he makes summer, the banks will be trying to throw money at him and he'll be in a position to laugh. Arky stands a chance of being one of the big boys.

[Jeff]

Never Give A Inch

Don't use that one for an example, it don't end well at all. The original name was "Sometimes a great notion" and it was from the book of the same name by Ken Kesey

[DonT]

I was given some advice when i was about 10 by an old horse logger,it related to driving a snowmobile but it applies to most things in life"never say whoa in a bad spot" and from me,keep beliving,the power of positive thinking can take you a long way.

[Ron Wenrich]

I worked for a local medium sized sawmill back in the early '70s that had similar problems.  They never quite had enough money, and they didn't pay the highest wage.  But, everyone worked hard.  The company was started by the owner's father, and had been a retail yard and a sawmill.  The father retired, and the sons took over.  Lots of infighting lead to a disjointed management style.  Eventually they all split up, and one guy bought out everyone else.

Their turnaround came from a rather unexpected source.  It didn't come from pumping more money into the operations.  It came from doing business in a different way.  The man who did that was an older lumberman from a different state.  He was a lumber buyer and he stopped by to buy some lumber.  But, what he found is that the operation was disorganized. 

This guy enters the operation as a consultant.  He worked strictly on commission.  He marketed all the lumber, he did the lumber inspection, the grade sorts, and all things needed to run the sales end of things.  When the sales came into line, then the rest of the operation started to turn around.  They originally had their own logging crew, but they eventually split that off to where they bought standing timber and had loggers subcontracted to do the logging.  They bought local logs.  They subcontracted all the trucking.  Their business came down to being only sawmilling.

When they did away with all those satellite operations, they could concentrate on what they did the best.  Eventually, they dumped the consultant.  It was about a 15 year relationship.  Then they went on a big spending spree.  They became the biggest hardwood mill east of the Mississippi.  The recent recession has made them reorganize, and pare down the size of operation.  But, they have come through this onto the other side without folding like so many other mills have done.  Debt was one of their problems, since they had to pay the banker every month.

My point is, you might have to look for your angels in something other than a cash situation.  They take all types of forms.  You just have to be smart enough to recognize them when they come along. 

[Busy Beaver Lumber]

Arky

Sometimes an angel comes in the form of someone that keeps you from borrowing money rather than one that offers to lend you money or invest in your business.

Case in point, when I met my wife 10 years ago, she was dirt poor and trying to raise 4 girls all on her own. Her x husband was in jail and never paid a cent in child support and they had no medical insurance on either of them or the kids due to him never being able to hold a job. When we were dating, I can remember one night when I went to call on her and she was sitting on the floor wrapping pennies so she could go and buy a $7 prescription for her youngest daughter needed for asthma. I on the other hand was in decent financial condition with excellent credit and and zero debt. At age 38 I already had a house valued at over $300,000 paid off free and clear and some money in the bank for a rainy day. I had divorced several years earlier when my x wife became physically abusive towards our daughter and I had full custody of our 12 year old daughter and was raising her on my own.

Well once we got married, things improved immediately for her and her 4 kids. For the first time in her life, she did not have to scrimp and save just to get buy and the kids each got their own bedrooms for the first times in their lives. She no longer had to count pennies as I had a good steady job that I have been at for the last 24 years and  where I make decent money and have good benefits. Only one thing was missing from her life and that was that she wanted to work and help me support our new family

My immediate reaction was to offer to borrow money from the bank and get her set up in her own business. We had talked about opening an embroidery and sign shop and I figured it would take about $50,000 to do it right. I was all ready to sign for a loan and had little doubt that she would do well at it since she is very motivated and ambitious. But when I told her I wanted totake a loan to get her going, she got hysterical and pleaded with me not to do it, right down to begging and shedding tears. At first I had trouble understanding her reaction, but then she explained how she loved our life and our house and that she would go to pieces if anything happened to either of them. To her, it was not worth the risk just to start a new business.

She liked the idea of having her own business, but not the risk of owing the bank money and having monthly payment to cover. She instead asked if we could both just save up and do it in cash, which is exactly what we did. She took a full time job and I continued to work my current job and take any and all overtime we both could get. In less than a year, we had the cash in hand to start the business. In 2001, we bought the embroidery and vinyl cutting machines and are still in business doing that to this day. We operate those two businesses right from our own house.

When the economy was in better shape, we had some killer months of income. When it took a dive a few years ago, we had some pretty lean ones, but we never had to worry about loosing money of stress over payments to the bank or equipment payments because we owned everything free and clear and had virtually no overhead since we worked the business from home

Four years ago when I wanted to get into the sawmill and firewood bundling business, I once again told her I wanted to borrow $70,000 to buy a building that I had my eyes on, a new woodmizer sawmill, truck, trailer, and other assorted equipment. Once again she begged me not to and said "I do not care what business you want to start, and I have all the faith in the world in you, but all I ask is that you do it in cash". So rather than rush out and take the $70,000 loan, I did it her way and saved up the cash over 2 years. I then bought everything I wanted with cash and started the sawmill business. Actually patience wound up to be a virtue as I found a much better deal on another building which I did buy, got a fantastic deal on a used woodmizer sawmill, which I resold at a good enough profit that is almost totally covered the cost of my brand new LT-10, and along the way found some excellent deals on the truck and other equipment I wanted. By being patient an listening to her, I got everthing I wanted for about $45,000 instead of $70,000 and I don't have any payments to make. My total yearly overhead costs to run the business are less than $1000, which includes utilities, taxes, and insurance.

We have been banking a good percentage of the profits from the business and the next time we want to expand or venture into something new, we already have the money on the side to do so.

The whole point of this long winded story is that sometimes it is better to grow slowly or be a bit patient and use your on capital than it is to go to the bank and owe them for the next 20 years, not to mention what you wind up paying in interest. For us, at least, this strategy has paid off very well and it is a lot easier to sleep at night knowing that you own everthing free and clear and nobody can come and repo it if you have a few bad months.

In my case, the angel came in the form of my wife and her fear of ever being broke again, and I thank God for sending me this cautious Angel.

[Larry]

Where are the Angels?

Gravity Ventures Arkansas

Northwest Arkansas Entrepreneurial Alliance

Innovate Arkansas

You try any of these?

Our local newspaper must be the best in the country as business stories range from total failures to business superstars...and we have plenty of both.  Pretty inspirational stuff...wish I had a couple of do-overs.

[ARKANSAWYER]

   Larry they are not Angel Investors they are Venture Capitalist.  There is a differance.  Most of these companies are the reason I started this thread.  This thread is not a "Whoa is me" but is like the purpose of the FF to inform and educate the members and guest.  These groups are not interested in building a company or improving our economy.  They are just as greedy as any Wall Street Investment firm.(which by the way does not give a DanG #&$^@ about you our your future,  For if any Wall Street firm cared about you the only time they would make any money would be when you made money so you would never never lose money)
  "Whoa is me" as for I may in the next month or so loose all that I have tried to build.  That is OK! and I am fine.  For my Pa always told me that when you think that things are going badly, you look around and someone else will be worst off then you.  If you look around and no one is worst off then you then you have hit rock bottom and there is no better place to build a foundation and start back up.
  If it was for the fact that there were no logs to be had or no one wanting to buy lumber it would be a different matter all together.  And while some say grow slow and you will get there do not understand the lumber business very well.  For like somethings this business grows exponentially in cost, production and overhead.  As you grow your cost of production drops while your cost of operation may be rising.
  Now I started with a mill and hit the road.  I was invested with $25,000 in debt and worked very hard and by the end of the year made a $1,000 profit.  Not bad and the next year I cleared about $5,000  in profit and it stayed that way for 5 more years.  So all I would have to do is work for about 300 more years and save my money and I would then have enough to get to where I need to be.  Maybe if I invested well it would only take me 250 years to save up the money.  If you are not starting to see a problem then you should as I am almost 50 now.
  5 years ago I bought the land and moved onto it.  By the end of the year I was $129,000 in debt and had sales of $389,000.00.  I reinvested my profit and grew more the next year.  When the economy dropped in early 2009 we pared back but was still making money.  In late 2009 they pulled my line of credit which I used to take advantage of oppertunities and sales flatlined.  In 2010 due to bad weather and economy we just hanged on.  With out the chance to take advantage of large orders we slip a little lower each month.  When you saw out a $3,000 order and have to wait a week to recover your money before you can start the next one you lose half of your production capicity each month.  When you grow you do not grow in small steps after a while.  I once got by with one tt load of logs a month, then soon it was one a day and there for a while we were doing two tt loads a day.  When I was doing just one a month I was doing little orders and could only sell what I had.  When I was doing one a day I filled large and small orders all at the same time and the profit margin was alot better because I did not have to sit on the side wood of one order waiting for it to sale.  But when you do a tt load of logs a day that means you need to have a two week supply on hand in case of bad weather or other things out of your control.  So I went from having $1,500 worth of logs on hand to having between $15,000 to $20,000 on hand.  So maybe you are starting to see how the exponential effect starts kicking in.  With this you need to be able to move the wood, slabs and waste as well as pay for the increase cost of operation.
  No one wants to invest in something like farming or sawmilling because the return is low and slow.  Yet this very fact is going to be the reason our economy goes under.  Sure I can go to work for International Paper or some other Wall Street traded corperation but they are not going to put a plant in Flippin Arkansas.  If we do not start investing in Main Street there will not be one before long.  We can not all work for the GOV and buy everything made in China.
  Like Job in the Bible I do not know what great sin I have commited to deserve this punishment, for I would repent.  I do not know why bad things happen to good people and why the unjust profit so.  I just know that it rains on the just and unjust the same and all is the will of the Potter.  He cast the pots and does with them as he pleases.  I know not way I have drawn this lot and like it not a bit.  Yet all I know is the sun rose in the east this morning behind the clouds and should I live so long it will sit in the west when it's journey is done this day.  My task is not to be a sawyer but a sower of seeds.  I have sown seeds this week and done good deeds.  Be careful of what you pray for and remember this, your next breath may be your last but, holding this one will not make your life last longer. 

[Weekend_Sawyer]

 Arky, I have no advice. I just want you to know that I am pulling for you and hope you win this one.

 Good luck
Jon

[old joe]

Son , None of -us -I guess are Angels.  That said,  we're all pulling for you, and praying if we do that.  Do what you can, and take advantage of opportunities you can handle.
Best luck.

Joe

[thecfarm]

Takes money,to make money.No advice from my corner,but will pray an Angel will come your way to see you through the bad times.

[Roxie]

I feel your pain, and I understand completely.  At 58, the company I worked for just closed the doors, in the worst economic time that I have lived through, and believe me I've been dirt poor before.  But I worked hard to have the modest life that I had, and usually that meant having at least two and often three jobs.  I can't even find one now, and I find myself begging for employment at 1/3 of what I was making when I lived modestly. 

You mentioned the Book of Job from the Old Testament.  Remember that after he was tested, God increased what he had lost twelve fold.  I don't ask twelve fold, but it sure would be a blessing to return to average. 

This must be how that 'deer in the headlights' feels.  Do I move forward?  Go back?  Stand still?  For anyone thinking, "move forward" I ask, how many times has that deer walked right into tragedy? 

There are some very comforting words here for you Arky, and if you don't mind sharing them, I'm gonna hold some to my heart.  Just like you, I don't want sympathy, pity or advice.  It's just telling it how it is to those who refuse to listen and understand that very hard working parts of this great Nation are slipping under.  We allowed and most encouraged the Government to publicly support the loss of Wall Street, while allowing them to keep the profits private.  What's trickling down to the little guy, isn't money.

 

[BCtimber]

Well I can tell you things are no different in Canada.  I live in a small interior town that is basically ruled by the large mills that exist here.  The timber supply here is probably 95% controlled by the two huge mills in the town.  This is all related to the softwood lumber disagreements that we are all aware of.  Basically the the huge companies controll the trees on all "public"  lands.  All I can access -at great expense and red tape- is some crappy dead pine trees.   What this means here is over the last 5 years or so small operators have not been able to make much money to be ready for the lean times.  When the housing market dropped out pretty much all opportunities disappeared and we have had to scramble.  Now I am used to adversity in the life I have chosen as I have been broke and had to rebuild and repay debts in a big way three times now but the difference is there is not much to look forward to for the next few years.   The one good thing is the with the dead pine trees deteriorating fast our main mill that owns everything will hopefully shut down in the next few years and maybe small operators will find a place again.  I tell you Canada is a great place in a lot of ways but encouraging small business is not one of them.

[Autocar]

BCTimber I don't think there real friendly with the small guy in the states eather

[BCtimber]

Yes I am sure you are right about that.  Just wanted to vent. 

[LeeB]

I don't know about angels and such, but I do know about self worth and when you forget that or give up trying to maintain it you are surely lost. I don't think you are anywhere near that point yet. Keep scratching and clawing along. You'll make it through. I know you will cause if don't Matt won't have a place to work and then I gotta feed him. I've seen that boy eat and I really don't want to foot that bill.

[ARKANSAWYER]

LeeB  it might be cheaper for you to become an Angle Investor then try to feed them two kids.         Jobs are getting hard to come by here.
  BillG came by and visted Wednesday and bought me lunch and then had to pull some slabs and wrasle some logs for the privilage.    It is a real pleasure to visit with people who like wood and sawing.  We could have gotten more visiting done if the customers would have left us alone.  A few days above freezing has really brought out the stump kickers.

[jim king]

 
 

We could have gotten more visiting done if the customers would have left us alone.

That sounds positive 

[kderby]

Arky, thanks for the observations.  I am still coming along behind you.  I did not borrow money and that may be my salvation.  This week I had a meeting with a mentor and we did my numbers.  He ended up saying that I had better find a way to get into the black or I should just say this "business" was an expensive "hobby."  Of my customer groups, one group the "artists" do not buy much but I get good margin.  The other group "landscape timbers (railroad ties)" buy volume but at a slight loss.  I spent a day wondering if this has all been an expensive junket (hobby).  Then I re-connected with an earlier customer and shared my current situation and found some opportunity.  Nothing in writing yet but a solid opportunity.

It was actually good for me to consider the hobby angle and really face (again) losing this business.  I realized I still had my health and my loyal and loving wife.  Even if I had to lose the business I was still able to have what matters most to me.  Like you, I still may go from poor to really poor but I am not broke.  That seems a little less horrible now that I recognized the other values.

In the old days men would set sail on an expedition.  They would hope to return with pockets full of treasure.  Sometimes the family got a telegram: Ship lost at sea...no surviviors.  Starting this business has been my big  expedition.  Am I sad/angry/scared when I struggle to survive, yes.  I just need to remember the sun will come up, the grandkids will giggle and the fish will wiggle.  I may get home from this adventure busted up.  I needed the reminder that at least I could come home.  My chickens are laying more and the garden will feed me...got bait?...lets go fish.

I am sure glad you are still here and talking.  I really am right behind you on this business start-up expedition.  It would mean a real loss to me if you were "lost at sea."

Kderby

[Ironwood]

Nice post KDerby, I like the giggle, wiggle thing.

 Things are tight here. Opportunity is still out there, working harder to get it though, and tightening my belt a bit.

 Kids are healthy, wife still loves me. The important stuff is in order. 


 Ironwood

[Bill Gaiche]

Arky has the talent and desire because I see it in him. He loves what he does and I can see why. He has all the tools to provide the customer what they need if only this economy would turn in his favor in which I believe it will and he will survive. He has what it takes and that is very important. I wish him the best and anyone else that is in his shoes also. bg

[ARKANSAWYER]

  Kderby is just the reason I started this thread.  Because just before you go under you will grab for just about any thing that you think will help you float a little longer.  His observation about how with some customers you have a good profit margin and on others you lose money or just break even.  You need both customers.  I am not having troubles with getting orders where my problems come from is my purse is light on coins so I have to wait for an order to be filled then picked up and paid for before I can start again.  So each month I lose from a week to two weeks of production waiting to get some coin to go again.  Now I am not talking about just a few logs but truck loads.  If there was no work and no logs to be had then the pain would not be so bad.  What is my fault is I tried to grow and become larger and was about to make it when the housing bubble busted and then the Banks pulled in the lines of credit and stopped loaning money.
  Kderby talked about how men used to go to sea to make their fortune and how many did not make it.  "Go west young man" comes to mind and what has made this country a world leader.  It will need to be that attitude that pulls us out of the mess we find ourselves in.  This country was founded by those who sought out more then what they had.  Up to now they had to just go after it and many never returned or made it the first half dozen times.  In the days of old the Gov was not taxing them to death, workmans comp, income tax, property tax, and a pile of rules and regs that make you head hurt trying to figure out just what they want done.  Just ask someone selling catfish.
  It will take people doing what hurts.  We will have to spend more and buy US made.  We will have to boycott imports.  Not buy stocks in companys that move their production offshore.  Invest at home and take lower, slower returns on our investments.  We are going to  have to use less fuel and vote more for them that help us here at home.  Stop wasting money and spending Billions on a war we can not win if we are not willing to fight it to win.  I may go down with the ship but I will be bailing till my head goes under water and I can no longer find my bucket.

[D Hagens]

  Well I’m kind of lost here when you say that you’re in business and self-proclaimed good at it and then I read that you expect to break even on jobs and expect a loss on others? What’s that all about?
 I’ve been in business for 17 yrs and there’s never been a loss on a job. If anything I’ve learned from each job how to make more on the next one.
 If my accountant saw me going downhill I think she would tell me to start looking for a job hanging out a window serving fries.
 Yeah the economy goes up and down like a Yo-yo but when that happens a guy has to diversify.

[jim king]

I have been in business much more than 17 years and I can say that all of my ventures were not great.  Some were world class catastrophies but you just have to get up and shake your head and try again.

Above was a note about hobby industries.  There are a lot of niche markets out there that can and do make a lot of money.  They normally have a low overhead which is the cancer that kills most businesses and they operate on very good margins.

When I was shipping out hobby woods I would invoice about $140,000 for a 7,000 bf 20 foot container  shipment.  The big mills with a huge investment got about $6,000 for the same volume of wood.

Now the competition in that market do to the internet plus the new avalanche of laws has about ruined it.  It is time to come up with something new again.

Maybe a serious round table discussion with a group of friends and a case of rum will generate a new winner.

[Patty]

I have owned several business's over the past 30 years or so. Like Jim, I had a few world class failures, and they were very painful, to say the least.

 No one has a God-given right to own a particular business, you have to earn it through hard work. And even then, sometimes they fail. I owned a restaurant once. I put my heart and soul into that place. I arrived at 4:00 am and left at 11:00 pm, exhausted, 7 days a week. It nearly killed me, before I went broke. We sold the building, the contents, all of our furniture, and our home to pay off the debt. We moved into an abandon farm house and worked very hard to pay off the remaining debt. (I do not believe in bankruptcy, I promised to repay the debt when I took out the loan, and I do not break my promises). Then I got up, dusted myself off, and licked my wounds for a few years while working a 9-5 job.

It took a long time to build up the courage to try a new business. We saved the sign from the restaurant, and whenever the entrepreneurial bug would hit, I would go out and look at that sign, and all the pain would come rushing back.

No one has any guarantees in life, and sometimes you just gotta say, "enough", and move onto the next phase of your life. Blaming the bank, or investors, or your mom, or the weather or whatever, just doesn't cut it. You have to suck it up, admit your failure, and then move on. There is no shame in trying. There is no shame in failing. There is shame in blaming everyone but yourself.

[jim king]

I think a major key to success is being to stupid to quit.  Or unemployable by a normal company.

[gunman63]

OK, this is  what i would do, but everyone is different, u have orders,  u have a mill, u need logs or money, find a partner with cash and that wants  to work, even if its short term, not  everyone wants a partner,  but sometimes what u want and what u  need need to be looked at.

[ARKANSAWYER]

DHagens,  When you saw logs it is a crap shoot from the beginning.  There are logs that just do not saw out well and you will lose  money on it.  Then there are those logs that just keep making money.  When you saw an oak log the outside wood is sold by grade and it is what will make or break you.  The railroad tie that you cut from the middle will most of the time it will just break even on the cost of log and production.  So yes you saw knowing that on somethings that you make will lose you money.  If you cut pallet stock most of the time it is just a way to move a product but you will not make money doing it.  If it was easy everyone would be doing it and be very rich.
  The trick as in most businesses is to be able to get a break and do the things that make you money.  Some people get it right right out of the box and everything falls together.  Most do not even the first 3 or 4 times.  It is more luck then just about any thing else.  You have to work hard and be  willing to take a loss.  But it is like Las Vegas, enough people have to win to keep people willing to try.

[D Hagens]

DHagens,  When you saw logs it is a crap shoot from the beginning.  There are logs that just do not saw out well and you will lose  money on it.  Then there are those logs that just keep making money.  When you saw an oak log the outside wood is sold by grade and it is what will make or break you.  The railroad tie that you cut from the middle will most of the time it will just break even on the cost of log and production.  So yes you saw knowing that on somethings that you make will lose you money.  If you cut pallet stock most of the time it is just a way to move a product but you will not make money doing it.  If it was easy everyone would be doing it and be very rich.
  The trick as in most businesses is to be able to get a break and do the things that make you money.  Some people get it right right out of the box and everything falls together.  Most do not even the first 3 or 4 times.  It is more luck then just about any thing else.  You have to work hard and be  willing to take a loss.  But it is like Las Vegas, enough people have to win to keep people willing to try.

 Yes Arky I do understand log grade, how it works and yes there are the odd logs that get shipped through that can be a crap shoot but you pencil that in to your costs and you will have a nice average at the end of the day.
 When I was a lumber grader we figured that about 8% went to the bin. Yes we could have cut shorts and sent it to the re-man for finger jointed crap but with the slim margin why waste time. Time is money!
 From a business point of view if you’re going to waste time by not making money cutting pallet stock then why do it? It’s really a bad business practice and when people around you see you doing this you might get labelled for it.
 K I charge out 65.00 an hour, let’s say times are tough and I charge out 45.00 which I know I’m just getting by then what happens next week when things pick up? I’ll tell ya what happens people already got wind that I lowered my rates and want the same deal. In their minds they think that I was hurting last week so it's the same price. I say no, they turn around and hire the guy above me cause I now have bad business practices.
 K when you say you’re hurting and blaming everyone from the janitor at your kid’s school to the politician up the road you’re doing one BIG thing wrong! You’re not putting any of the blame on yourself and your business practices.
 It’s your business; you make it sink or swim! There’s no one to blame for a bad day but yourself.
 No lumber in my area? Move your mill, look elsewhere.
 One thing I will say that I’ve always noticed about my competition that has to borrow money to keep going is that I get a flow of their customers a year later cause they can’t make payments and whine at the lumber store about how bad it is out there.
 Arky, take a big step back, don't beat yourself up and look at the big picture from the outside.

[Jasperfield]

As you apparently know, Job literally lost everything he had except his name. And through no fault of his own. He lost all of his wealth, family, and health. However, by his keeping faith, he recovered way more than he ever lost.

My commentary is this:

Look at the worst possible fiscal scenario. Determine how you would begin to resolve that situation. Then, go up from the bottom and find the most likely point where your actual situation will stabilize from the fall, and work from there.

Having determined movement from the bottom will help direct your actions from a higher level.

[Cedarman]

It is better to saw the rest of the log into a tie or pallet lumber and take a small loss than throw it in the chipper or burn pile for a big loss.  The biggest profit margin is on the high grade lumber.  But to get the high grade you are left with material in the log that won't make much profit or any.  The log is paid for. Now if the cost of sawing is more than what you get from the material, then punt.
My job is to get the greatest economic profit from every log doing it in the most effiecient manner possible.  It is to find the best market for each part of the log.  Highgrade material, low grade, slabs, and sawdust.   You sure can't say you saw slabs for a profit if you figure what you paid for the log and value the material in the slab the same as the material in the high grade lumber.

 Gross profit is what you have after buying the log and paying processing costs using equipment on hand.   Your decision is what to make from the log that gives the greatest profit after processing costs are subtracted.  Different product mix gives different profits.  These can change as prices for products change.

[Cedarman]

Pallet lumber, grade lumber, ties, chips, etc have the price set by the buyer, which you have no control over.  You must shop for they best price.
When you charge by the hour or sell wood in a niche market, you control price and can change on a whim.
Two completely different situations.

[DanG]

Either I have misunderstood, or we have drifted away from the original dilemma here.  All this talk about what to do with the log is great info, and probably helpful to a lot of people, but Arkey's problem is that there is no log.  You can't cut a tie or pallet lumber out of a no log.  According to his posts, he could get logs if he had the money to do so, and he could sell the lumber if he had the logs, so what about some ideas of how to get the capital he needs to get rolling?  In these times, that is going to take some creative thinking.

Arkey, I'm sure you're already having to do some things that go against your grain, and you may have to do more of that.  I'm betting that your nature is to get to the mill bright and early, and have metal and wood together as the sun comes up.  You may have to give up that "luxury" and spend an hour or so in the coffee shop, networking with others who are having a hard go of it.  There just might be a logger or a landowner that needs to move some logs bad enough to wait a couple of weeks for his money.  None of us here know what your local situation is like you and your neighbors do.  Think outside the box, and while you're out there, move around in places you wouldn't normally go.  There may be an angel wandering around somewhere, but he probably won't look anything like what you expect.

While I'm rambling, I have a question for all you bidnesspeople.  What do you mean when you say "there is no money in it", or "you can't make money" doing something?  Should one take that literally, or do you just mean there isn't very much money in it?  Sawing pallet lumber for a dime isn't very good when there is 50¢ lumber to be sawn, but it can save the day when there is nothing else.  I just don't want whoever reads this thread in the future to be confused by little things like that.

[Cedarman]

For me,"there's no money it" means that when all is said and done, I spent more money processing the log than the increase in value for what I did to the log.

[Bill Gaiche]

DanG, I believe you have hit the nail on the head perfectly. I also believe that if there is a will there is a way. Hopefully what you have said will bring that angel the very way you mentioned. bg

[Raider Bill]

Not knowing anything about logging and sawing what does a load of logs cost? I know there's all kinds, hardwood, softwood, oak, whatever but give me a idea.
For instance......

[SwampDonkey]

I'm posting this case study link here, as it might be an interesting read for some folks.


http://aics.acadiau.ca/case_studies/atlanticlumbertraders.html

[Busy Beaver Lumber]

Arky and Dan

Focusing on the matter at hand and trying to think outside the box, I offer up the following suggestion on how to gain access to capital. Dan, remember you asked us to think out of the box.

1. If you have orders, but do not have the money to get logs, would it be out of the question to ask the person that has placed the order to put a deposit down equal to what it cost you to buy the logs. We do it all the time with our embroidery and sign business. Lets say a customer want $8000 worth of embroidered shirts and the shirts cost us $3000, We would require a $3000 deposit before even beginning the job and ordering the shirts. This way we don't have our capital tied up.

2. If you were sure you could get paid within 30 days, would it be out of the question to buy the logs using a credit card and making the payment through payal? With certain cards like Discover, you would actually get 1% cash back on the purchase and make a few extra dollars doing so. In the example above, we would use Discover to buy the $3000 in shirts once we got the deposit from the customer and make another $30 on the cash back bonus to boot.

3. In this day and age when banks are paying about 2% interest, you would think it would not take much convincing to find private investors willing to accept a 5% rate of return. Have you tried running an ad on line offering to sign a promisory note paying 5% to get the capital you need? Could you possibly convince the log sellers to accept a promissory note saying they will get paid in 30 days with 5% interest, using the logs you obtained as collateral.

4. What about incorporating and selling shares of stock in your company which is the way many companies raise venture capital. The benefit of doing this is that although investors expect a rate of return in the form of either stock appreciation or dividends, you are not under any obligation to pay dividends as it is at the boards discretion as to whether or not to do so. Of course, if you wish to see the price of the stock rise and be able to get more for each additional shares issued, ideally you would like to see both stock appreciation and the payment of dividends. You would keep the majority of shares (over 50%) in your control so that you alone could influence the direction of the company just as you are currently doing, but if you hit it big, the value of your shares go up as well and makes for a nice retirement income when you decide to divest yourself of the business.

[SwampDonkey]

1. You kidding? I have worked at a marketing board and sometimes the wood receipts from mills purchasing wood were 3 months to 1 year behind let alone making a deposit to match what we paid in full to the producer and trucker by weeks end. Did up to $12M in sales and between bank interest and service charges it cost somewhere around $3500 a month to pay the guy with the saw and truck and then wait for the cheques from mills.

2. Refer to #1. That 1% cashback only works in your favour if you zero out your balance on your statement, paying interest at $15-24% pretty much kills that after 21 days grace.

3. If the banks won't lend it, you gotta have some nice friends willing to risk their hard earned cash.

4. The margins are too slim for the small scale sawyer, it's pretty much a cut throat business it seems.


Sorry to dash hopes. 

[Busy Beaver Lumber]

Swampdonkey

All due respect:

If you read Arky's post, he is not talking about waiting 3 months to a year to get paid. He is saying he has to wait a week or two to get paid and has to sit idle during that time. Using the credit card and paying it off during the grace period appears feasible when you are talking 2 weeks to get paid. If you pay it off in the grace period, you would see the 1% cash back.

I personally would not do business with any company that took 3 months to a year to pay. I am not a bank. If they want someone to finance their inventory, they should go to the bank and take a loan themselves. I delivered over $50,000 in firewood last year alone and it is always cash or check on delivery. If someone does not agree with those terms, they can take it down the road to someone else.

So far as friends being willing to invest their hard earned dollars, that comes down to trust and is a personal issue they must decide. Arky does not come off as a man that would mislead his friends just to gain access to capital. I do not think he would borrow money that he did not feel he could pay back in good faith and if he has a backlog of orders, they serves as an insurance policy to assure them they will get repaid. It would be one thing if he was looking to borrow money without any concrete way to pay it back, but he says he has the orders needed to generate income, just not the money to get the raw materials to fill the orders. Having said that, he would actually be doing them a favor by giving them a 5% return if the best they are getting from the bank is 2% or so.

I agree that the profit margins are slim for the small scale sawyer, but I do not think that he falls in the category of a small scale sawyer running 3 saws and having $369,000 in sales a few years ago. Given the right capital, I think he has the ability to be one of the big guns.

[WDH]

Not knowing anything about logging and sawing what does a load of logs cost? I know there's all kinds, hardwood, softwood, oak, whatever but give me a idea.
For instance......

Raider,

A load of pine logs is about $900 - $1000. 

[Raider Bill]

So we are talking a load or 2 to keep ahead or more? Just trying to get it in perspective.

[SwampDonkey]

Beaver, the bottom line is, the small margins. Even if turn around is less than a month. Not enough output for capturing enough operating capital to keep the mills fed. There still must be a lot of combined output around the area keeping prices low. If the buyers where scrambling than the price would go up.

Beaver, I certainly here ya on the waiting for pay. But, unfortunately it's the way it's always been and will probably continue that way. The biggest, richest outfits are the worst, that's why they are where they are. We are at the mercy of the buyers, which are industrial pulp mills and sawmills. We have even taken big losses when mills go down (several $100,000), but we have also been in business for 30 years.  And we have been doing it on less than 3 %.

[Kansas]

I learned a long time ago in this business that you can work yourself to death, and end up with nothing. I also learned not to try and bother to run with the big boys when you own a bandmill. You make more money spending the time developing high margin markets than you ever will selling a product that someone else is going to dictate what they will pay. Case in point. We sell some pallet lumber. We have pallet makers who are long time customers. We set the market. We try to be fair, but we also intend to make a profit. We can't do that cutting a standard 5/8 x 3 1/2 x 40 inch deck board. Everyone cuts those. We can make the profit when we cut a 2x4 52, 65, 60, 72, etc. When the customer calls up and says I need 250 of this, 400 of that,  etc. And they need it in two days. That is worth something to them, and they will pay.

I have had quite an eye opener the last month about how mills fall into a mindset. I have been looking for cottonwood lumber. I was really wanting a lot of 12-13 ft long stuff. It could be random width. It did not need to be cut to length. I was willing to pay a hefty premium to get it. One circular mill told me they never cut anything longer than 8 ft. Whatever they cut, had to be either 3 1/2 or 5 1/2 wide. And it all had to be cut to length. A broker I am working with told me he has one mill that he has begged to cut 50 inch 2x4's. Nope. They will only cut 48". Even getting a premium won't budge them. I know grade mills that went broke cutting grade, yet refused to cut high margin trailer decking. It was different than what they were used to, and they just couldn't wrap their minds around something different.

Arky, I have seen your posts over the years. Even remember when you started the expansion. Always admired you. I even have in some ways copied what you did. But a gentle criticism here. It always struck me that you were working too cheap. I know you work hard, that is obvious. Working on the marketing is the key.

Only advice I have for you concerning financing may be this. Not sure what all is available in Arkansas. I found out by accident what was available in Kansas. It all started with a phone call to the county wondering about getting a property tax abatement on the building we will put up that will house our operations this year. Next thing I know, I'm at a lunch with all these economic development people. (These people live to do lunch). They want me to try for 2% interest money for the whole thing. Someone from a University is there, he does a business plan for us. More people involved than you can imagine. I would suggest calling someone in your county that has to do with economic development. They may know what resources are available. Sometimes a slicked up business plan taken to a bank can go a long ways. They know all the right people, and that can make a difference. Contact SCORE, if they are in your area. Its free. They might have some ideas you haven't thought of, or ones you thought couldn't happen. At least they could crunch your numbers and give you some ideas.

[ARKANSAWYER]

 Well here is a case in point.  Guy calls and needs 50 ea. 1x10x9' pine boards.  Total of sale $261.08.  Would need to buy a load of pine logs that cost about $1,300.00 to fill the order.  Would be able to sell the rest of the logs cut into lumber in the next month and have other orders and people calling me every day.  Now that is just 375 bdft of the 5,200 bdft of the load.  It will cost me $1,300.00 to buy the logs and $1,300.00 to saw up the load of logs.  Will take me about two days to saw it all up right now.  Yet if I do not have the cash back from the last load, I do not have the money to start the next load.  So you see I need $2,600.00 to start this order and when done the load will make about $3,120.00 which is a net profit of $520.00.
  Next phone call 15 min later is a guy wanting to buy 1,000 1.5x6x8' cedar boards.  Price for the sale is $5,917.10 and I will need two loads of logs and have to have it done by the 1st of March and he is willing to send a check for half up front.  I thank him for the call but will be unable to fill the order.  WHY?  *#&%(*@# then I just go bump my head aginst the mill for a spell since I have nothing better to do.  That Electric Al is why I do not answer the phone.
  Now last year when I had my line of credit I would pick up the phone and order the logs and go to work.  Then the guy Electric Al knows could get his order filled as well.  Then when that really nice big log comes up to the deck instead of cutting 1x10's to fill an order you cut 1x16's that are all clear and save them back to go to the kiln.  Those boards will fetch $2.50 bdft instead of $0.60 bdft for barn siding.  But when working hand to mouth you saw it into 1x10's as you can not afford to put the clear boards back that will fetch more money later.  This is the start of the demise and when you start starving to death.
  So Raider Bill it cost about $1,300.00 to $1,500.00 to buy a load of saw logs (either pine or oak) and it cost about the same to process it into lumber.  This is money that has to be paid before sales can begain.  Now on pine you can sell most of it as it comes off the saw.  You will pull the better stuff out and kiln dry it to make flooring and paneling.  So if you pull 2 mbdft out of a 5 mbdft load you will hold that money back for another 6 to 8 weeks but will make $2,300.00 on it instead of $1,200.00 and only add $600.00 in cost.  When you lose you capital you can no longer afford to do that.
  I am incorporated but to be able to sell stock it takes alot of money and paper work to do it.  There are 100 shares of stock right now and their worth is around $1,500.00.  I can have investors but if they invest past a point I have to list them on my stock report.  If you go to the State of Arkansas you can see that I am a Corp in good standing. All that means is I paid my taxes.
  For the Economic Development people to get excited you have to have a profit margin of over 30% and it comes with lots  of strings like the SBA or USDA programs which is where you end up most of the time.  SO if your FICA is 800 or better and you have lots of assets or nothing at all and are a minority woman then you will be ok.  Yes they like to do lunch as they do no real work and sponge off of others who do.
  So how do you get 100,000 people to invest $10.00 or 10,000 people to invest $100.00 so you can build a business?

[paul case]

i am not in your shoes, so my advise and experience isnt going to help much so i wont waste your time. i do my own logging and this is the place where i starve since like you i have to pay when i cut someone elses trees and i dont get paid until i sell the lumber. i do my best not to borrow the money since it stinks to have to pay it back. if it werent a sideline business for me i would be broke too.
i too am pulling for ya. we all are in the same kind of boat.  pc

[Cedarman]

Cedar must definitely be selling for much less in your area Arky.  The 1000 boards would be $7.20 each for a gross of $7200.00.   If you can get them, there are quite a few sales to be had around the US. A good website will be your friend.  I always get the money plus shipping up front.  Last one is 2000' of 4/4 4" to 6" x 8' dried to 8% for $2900.00 plus $810. shipped to California.  Money will be paid up front.  Lumber won't ship for up to 3 weeks. Raised garden beds will be hot this year. They want 2x6 and or 8" x 4' and 8'.  $1.10 per board foot and they can be boards that have ingrown bark and small amounts of doughty wood.  Not much, but boards that won't make cedar chests.  These are people that do not want treated wood.  They are folks out east.
Charge more, and get money up front.  If you can solve those issues, you will be on the road to recovery.
I sell very little in my local area.  I sold zero sales during December that I charged sales tax on. That means all lumber was shipped out of state or to companies.
Local people think my prices are too high.  By local I mean within 20 miles.

Tongue and groove is selling well also. 9/16" for $1.40 to $2.00 per square foot.  Only needs to be good  on best face too.

I stay away from pine and hardwoods.  Not enough margin for our ability to process.
Cedar is the niche and you can name the price.  Pine and hardwood are commodities and the buyer sets the price for the most part.

[Busy Beaver Lumber]

"SO if your FICA is 800 or better and you have lots of assets or nothing at all and are a minority woman then you will be ok. "

Arky, There is more than one way to skin a cat

Maybe you just came up with the solution to your problem on your own. If you truly believe that your business would be treated better by the investment community if it was owned by a woman, or that a woman owned business would have ready access to funds that a male owned business would not, than why not make a few chages and take advantage of that situation? I see in previous posts that you are married. Why not transfer enough of the 100 shares to your wife, such that the business is now owned by a minority, that being a woman, and let her work the advantages given to minority woman owned companies to get you the funding you need?

In our case, our businesses are all registered to my wife so we get preferential treatment when we bid on contracts and it does work to our advantage. As luck would be, she is also part American Indian, which helps out as well towards minority status. At the end of the day, all the money goes into the same bank in an account with both our names on it, so no big deal to me whose name is listed as owner, but as you are quick to point out, it sure does have a bearing in how your are treated in the financial market and the preferential treatment given to minority owned businesses. In some cases, especially when selling to other woman owned companies, it has also made the difference as to whether we got the sale or some other company got the sale.

There is a huge construction company here in Fort Wayne that is owned 50/50 by a fellow that is part American Indian and his wife. He does not look any more American Indian than you or I, but somewhere he has a piece of paper that says he is at least in part. They know how to burn the candle at both ends and get all sorts of preferrential treatment when bidding on huge state contracts since the can play the woman owned and minority card at the same time.

[ARKANSAWYER]

Busy Beaver Lumber would your wife be interested in buying a slightly used sawmill operation in Arkansas?  I would be willing to run it for her.  I have thought of finding me a colored woman from Little Rock to buy me out on paperwork and just pay her so much per year to file paper work.

[Busy Beaver Lumber]

Arky

Actually, she is looking to buy a small deli or restaurant so she has some place for her 4 unemployed daughters to work. The kids all live in a real small town north of us where rent is very reasonable, but where there is only about a dozen places to work in town. Only one of them has managed to save money and buy a car, so the other three are limited to finding work within walking distance. Since the town is so small it has no bus or taxi service. The one that does drive can't seem to find a job either, nor has she managed to bring home a single boyfriend that I did not want to strangle within five minutes of meeting them.

The other day one of them told me that they went back to the same place that she had asked several months ago, and then several months prior to that if they were hiring. The lady that owned the place told her she would give her $20 if she did not come back and ask again because she liked her and wished she could give her a job and she felt bad having to keep telling her no. She did say she admired her determination and thought she deserved something for her efforts and gave her the $20 as promised.

[paul case]

we have a few real succesful people near here, who ask people to pay them not to work. they stand on a busy corner with a sob story sign that usually ends with''God bless''.
i would imagine the lady who wouldnt hire your daughter was real sincere but $20 is not a job. i wouldnt have taken it. it could have been a test. pc

[Patty]

Or maybe she was just being nice, felt sorry for the daughter, and was trying to help her out a little.

Just saying....

[paul case]

could be,
i know it must take a lot for a person to look and look and look and not find a payin job.pc

[Busy Beaver Lumber]

I really think the lady was being nice to here and truly felt bad about not being able to hire her. She is a lovable kid, full of excitement and energy and very good with customers. We often eat at that restaraunt and the lady that owns it knows my whole family for at least 3 years now. When this daughter was a few years younger, the lady would say to here that when she finished school, she would love to have her come work for her. Now that she is done with school and needs a job, I think she felt bad that she could not come through and offer her one and just hated to keep turning her down, but the economy has just about cut their business in half and they are just making it as it is.

When we start bundling wood in a few weeks, I am going to let her give that a try to see if she can do it, but I have my doubts as she is very petite and in some cases would need to lift bundles of wood that weigh half as much as she does and repeat that 300 to 400 times in a 3 to 4 hour spell.

[SwampDonkey]

Living in small towns around here you notice one thing, they are full of aging baby boomers and older folks. Something like a restaurant, as long as they have good service and value, do well around here. The pension cheques keep coming even if the remaining work force are suffering. That's just the way it is. In Woodstock the service industry in stores and restaurants is all that expands in the town. No one comes here to build cars, to make photoelectric cells, or refrigerators. Most of the economy that has anything to do with producing a product is based on farming and natural resources and the services behind it. But everyone eats, and most that eat out are the older folks unless your after your morning fix at Tim's on the way to the construction site. When they were building dad's home in Woodstock, they needed a dumpster to collect the coffee cups. I swear, Tim's made a fortune on those carpenters.

[ARKANSAWYER]

  I get about 10 people a week stopping in looking for a job or 10 calls a day to see if I could buy some logs from them.  I know they are hurting and need money but I just can not buy the logs or hire anyone.  Matt has only worked one day this week.  Right now I am only turning down about 3 jobs aday.
  Just got to get through Feb with out the Bank pulling the note on me.  March will bring better weather and people with income tax checks and maybe the over all economy will pick up.

[isawlogs]

 Can't you strike a deal with a logger to bring in logs and maybe pay a premium on them if you could pay for them once you have them sawded and shipped till you get turned around. Seams to me you need logs they need a market , you said you have the market but no logs ...

[D Hagens]

  Just out of curiosity what exactly are you doing with your profits? Not once have I read that you’re funnelling your profits back in to your company.
  As any business person knows you have to spend money to make money! If you take your profits and spend it on yourself then the company starves and down the tube you go!
 No matter how good or bad things are my company always takes  20%, no ifs or ands about it because that 20% adds up for when the company needs it.
 Reading your posts, not just this thread but your many posts you have a tendency to place blame on politicians, the economy and the minorities.
 Please tell me how either of the three mentioned above stop you from running your saw daily.
 At the end of the day the only one that makes your business sink or swim is yourself.
 Put a positive spin on things, change your outlook and post a positive and I bet you will get some excellent response!

[ARKANSAWYER]

   Reading your posts, not just this thread but your many posts you have a tendency to place blame on politicians, the economy and the minorities.
 Please tell me how either of the three mentioned above stop you from running your saw daily.
 

  I do not blame minorities but the system has tilted so that they have a benefit over others.  Why then would someone suggest that I make my Wife CEO if there was not a benefit.  If you go to the SBA website they have programs for everyone but poor white southern men.  If you can not speak english they will fill the paperwork out for you.
  The rules are made by the politicians that effect the Banks and Wall Street.  The economy is affected by the policies of the Politicians.  The GOV is the one who mandated that banks loan money to minorities to buy homes and the greed of Wall Street pushed it along because they could make money.  So maybe you can explain to me how a couple who brings home $30 grand a year can afford a $300 grand home just because they are black?  The bank dare not make the loan to them for the law suit would cost more then the foreclosure.  Thus we have the housing bubble that popped.  I saw prices rise here more from 2001 to 2008 then from 1976 to 2001.  In 1976 I bought my first truck and was paying $0.75 a gallon for gas, in 2001 I bought my last truck and was paying $0.95 a gallon for diesel and only $1.10 a gallon for gas for my new sawmill.  I am now paying $3.39 for diesel and $3.15 for gas for my sawmill.  Quite a change for just 10 years compared to the 25 years before.  Most of it can be blamed on the policies of Politicians. 
  I understand that the economy will go up and down.  Most businesses will have boom and bust just like farmers will have good years and bad.  You asked where my profits went?  They went back into the company.  My wife and I live in a shack and drive old cars and grow or kill most of what we eat.  There are several FF members here that have been to my house and will tell you that while I may eat the hog I do not live high on it.  Several say that you should never borrow money to go into business.  If that were the case there would be very very few businesses.  WalMart would not be what it is today if Sam had not been able to borrow money (and by the way he lost the first store)  But then again WalMart would not be what it is today if the banking rules and trading rules had not changed.  When I started I borrowed $22 grand and did about $50 grand in business and worked me and one little dog.  In 2008 I owed about $189 grand and did close to $400 grand in sales and employed 5 people and two little dogs and pumped close to $180 grand into my local economy of only 16,000 people.  Today I employ just 1 person and 3 little dogs and monthly sales drop every month.
  I did not lose my line of credit because I could not pay it back.  I did not lose my line of credit because my land is not worth more then what I owe.  I lost my line of credit because the housing bubble popped and banks are left holding notes on homes that are not appraised at the same value they were 3 years ago and the new bank rules say that they have to have as much in assets as they have loaned.  So if I have $40 grand worth of equity in my land they use it to cover loses in homes that they hold the notes on.  I can not use it to have a line of credit of just $10 grand because they never know when I will use it and it throws their books out of balance and the new rules kill them.
  So maybe then you can tell me where my problems come from?  Some will say I tried to grow to fast.  That may be true but in this business it comes in leaps, not steps.  If we all stay at home in port and play with our toy boats, who then will brave the ocean blue to chase the far horizon?

[Chris Burchfield]

I've been there, eaten well, enjoyed the conversations with he an his family, learned a lot in a short time, continue to learn on several of his post and offered to help him where I could.  I'll go shoulder to shoulder with him or clear the way for him with just a nod.  ARKANSAWYER is telling it like it is, where he is at, and I don't mean behind the "A" and the "T."

[stumpy]

Before this thread gets ugly and is sent to the woodshed, I suggest we go back to the beginning.  It seems he was just venting out of frustration.  I pictured him sitting at his home, head in hand, trying to figure out what to do and decided he'd just vent his frustrations with friends.  I met him once and he seems like a hard working decent man who is trying to make it.  As is usually the case when a discussion lingers on, it will drift into many different directions and uncover many different opinions.  In the end, I think he would rather come up with a solution than to just sit and complain.

[Kansas]

Arky, if the only thing standing between you and prosperity is a 10,000 dollar line of credit I would suggest the following(Assuming you have more assets than liabilities)

1) Start talking to different banks. Find out what they need.
2) Find out what government help is available to write a snazzy business plan to give to the banks. Dept of commerce, SCORE, economic development people.
3) Think credit card. I once financed feed for 130 calves all winter charging against credit cards and moving the charges around to different cards. This is a last resort move, but it can be done. Just be careful.
4) Sell unemcumbered assets and use that money as your line of credit.

Also, there is absolutely no truth to the notion that banks have to sell a 300,000 dollar home to a family making 30,000 dollars, black or otherwise. Banks rarely keep mortgages anyway. They make the loan and that loan gets sold to big banks, freddie mac, etc. Local banks got in trouble financing commercial loans. Most of those crazy loans were made by people like Countryside that wrote up "liars loans". Where the person claimed to make 100,000 dollars and only made 30,000. The FMHA has strict guidelines for banks writing mortgages for people of modest means.

[D Hagens]

 Arky, $369,000 in sales last year and you can’t afford to buy a few logs?
A few months back you posted that someone gave/lent you money to get back on your feet. What ever happened to that venture?
 You sound like a hard working guy but yet I’m trying to figure out where you’re doing wrong.
Post a positive, it will get you more than the negatives.

[Brucer]

Well, I took Arky's numbers and plugged them into my own business model and I came up with the following choices ...

1) pump money back into capital equipment.
2) pay myself 25% of what the employees are getting.
3) Buy enough logs for 3 days of production.
Choose one only.

Now you can't compare our businesses directly -- my volume is a lot less, my product is different, logs costs and selling prices are different. But his numbers and his problem seem pretty reasonable to me.

If your business model relies on a line of credit to buy raw materials and someone suddenly pulls the credit, then you have a serious cash flow problem, no matter how profitable your business is.

[Roxie]

Brucer, I agree with you, and the problem that Arky is having is the same problem that is keeping small business owner's from adding employees all across the country.

As a nation, we were assured that bailing out the banking industry was going to prevent this very situation from happening.  We saved the banks and financial institutions from their own bad decisions, and now they aren't lending money even when it's warranted. 

[ARKANSAWYER]

  I have recieved several e-mails from people who have read this post as a guest and told me how they have been ripped off by some of these "Angel Investor Firms".  One of the worst is GoBig and Funded is not far behind.  Just take a line from the Koran:  "Trust in GOD put tie up your camel".
  When you look at the site they are really helping people.  When you try to find the businesses most are out of business or do not exist at all.  Then there are some and when you call them they have never heard of the Angel Investor company you are asking about.  I just want my brothers and sisters to becareful out there.  As soon as the Widow gets with her barrister I have some money comming to the US and all will be good.   

[SwampDonkey]

Not directly related to this thread, but I'm saying it anyway. When you think about it, when we invest in Wall Street or Toronto stock exchange it's helping that region and not your own (assuming you don't live in Toronto or NYC). Even our own government didn't invest it's pension money in NB, it's in the above two exchanges. When we don't invest in our own region than no one has much grounds to complain. When the government here in NB throws money at a dying business it only prolongs the inevitable. I can't recall too many successes because the recipient didn't loose their money, it was the tax payers. A little different when you have to worry about your own dimes.

If you don't believe there are some prosperous companies not on them exchanges and in NB just look at two $multi-billion companies that are not even on those exchanges, privately held. 1) McCain and 2) Irving.

Citizens Irving

[stavebuyer]

Do you have any other mills in the area that you can re-sell logs to? It's not uncommon here for some of the larger grade mills to buy a tally. It wouldn't cover the logs you keep, but would allow you to buy the whole load without fronting the money for the logs you don't have immediate lumber sales for. I have done very well just buying, sorting, and re-selling logs. Most loggers don't do a very good job merchandising logs. As you have noted...logs are a cash business..if you can turn your log inventory over every week; even at only a .05 margin..you'll soon be able to hold enough to saw. I say this from experience as I was a salaried log buyer until sept 2009. A victim of the market crash myself I was laid off and started out with a cell-phone, a 98 nissan pickup with 150k miles, and 3k in my checking account. I bought and sold over 2 million bd ft of logs last year. Nine months into it I helped finance a used frick mill for a guy that contracts yarding logs for me. I now finance his tie logs and take payment back in sawn crossties.  There's angels out there..I had one help me and I guess I am paying it forward. Your angel won't be found at the bank or on wall street. Look closely at you current suppliers, customers, and people already in the wood business and propose something that will in some way aid or enhance their business in order to get your operating capital.

[ARKANSAWYER]

  Here we had 5 large mills in the area and are now down to just 1 large mill and a guy and his wife with an LT40 who do mostly custom sawing, a 70+ man with a manual mill and LeeB when he is home doing mobile sawing and me.  Some of the older loggers just parked their equipment and two younger ones are trying to hold on.  The large mill still standing does 90% of his own logging.  There are no other mills in the area that even saw pine.  Fifty miles away in two different directions are cedar mills and both of them are just getting by and have plenty of logs but are not interested in helping any competition.  I can sell logs to either one of them but with hauling fees and no real mark up on the logs it is a losing deal.
  I am however getting phone calls from people who have lost their suppliers because they went out of business.  One man from Little Rock said he called 25 sawmills and 18 had numbers no longer in service  and out of the others I was the only one who called him back on his order.  Some of those may have switched to cell phones but either way they are missing business.

[LeeB]

I haven't sawn for money in months. Haven't really done any kind of sawing in months. Been laying low so the guys that need the work can get it. I have a good paying job and saw becauase I like to. I have been sawing some walnut 50/50 with a friend just because he has it and I don't have any.