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Pricing/competing issue

Started by Gideon_70, August 09, 2014, 10:47:24 AM

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Gideon_70

 I had a potential customer call me and ask me to cut his pine into 1X6's and asked for a price, and I quoted him .70pbf. 

Then he said that he can buy (and I checked) and TSCo is selling 1X6x16's for 8.49 a board.  That comes out to about 8 board feet or 5.60 per board to cut.

My question is, am I charging too much?  I have a harbinger Freight mill, using cooks blades, and he's bringing the treez to me.
You cannot reduce crime by disarming the victims!

Jeff

I'd say, a yup, but what ever makes you and the customer happy. Around here, you would never get a customer.
Just call me the midget doctor.
Forestry Forum Founder and Chief Cook and Bottle Washer.

Commercial circle sawmill sawyer in a past life for 25yrs.
Ezekiel 22:30

ladylake

 
Way too much, most charge .25 to .35 a bf.    Steve
Timberking B20  18000  hours +  Case75xt grapple + forks+8" snow bucket + dirt bucket   770 Oliver   Lots(too many) of chainsaws, Like the Echo saws and the Stihl and Husky     W5  Case loader   1  trailers  Wright sharpener     Suffolk  setter Volvo MCT125c skid loader

Magicman

Yikes, you would not be competitive even if you were selling the lumber.  Steve's rates above are comparative with our sawing rates.
Knothole Sawmill, LLC     '98 Wood-Mizer LT40SuperHydraulic   WM Million BF Club Member   WM Pro Sawyer Network

It's Weird being the Same Age as Old People

Never allow your "need" to make money to exceed your "desire" to provide quality service.....The Magicman

Ribsy

Don't know about TSCo, but the big box retailers are also dealing with lumber that has been dressed and commercially kiln dryed. Just sawing is only one of several processes and unfortunately we can't get near top dollar.
Engaged in tree work, tree removal, milling and and processing said product into high quality and well seasoned lumber slabs and firewood.

Gideon_70

Quote from: ladylake on August 09, 2014, 10:51:31 AM

Way too much, most charge .25 to .35 a bf.    Steve

I just started this, and so far people are just giving me wood and trees like crazy.  I have about 20 10' longleaf pine logs in my back yard eight now, and another 30 waiting for me to pick up.  This is great and the reason I bought the mill to start with, my pole barn fantasies are blooming in my mind as we speak.... Oh, mortise and tenon joints....mmmm.

Ahem, anyway....

Long and short, I'm trying to get a starting point for sawing, and then fine tune it.  I see I chose badly, and that's fine... I'm not even sure what my real expenses are going to be yet.  35  foot is a good start I'm guessing, and I might be able to do that since I'm the only mill in the area, but do you charge that as a flat rate, or more/less by the cuts.  Different prices for 4/4 or 1/4?
You cannot reduce crime by disarming the victims!

Jeff

I would be willing to bet, that you only think you are the only mill in the area.
Just call me the midget doctor.
Forestry Forum Founder and Chief Cook and Bottle Washer.

Commercial circle sawmill sawyer in a past life for 25yrs.
Ezekiel 22:30

Gideon_70

http://www.woodcutterthingie.com

If you don't mind, take a look and tell me where I screwed up.

And yes, there were some mills in my area, but they eventually moved to a nearby area that has a lot more customers.  I'm a hobby mill and not really trying to make money out of it, but would like to pay it off eventually. The closest mill to me is about 45 minutes away.
You cannot reduce crime by disarming the victims!

Dave Shepard

Often, people will charge for a full inch for anything under 1". It takes the same time, fuel, and wear and tear for every pass, regardless of the board thickness. Charging hourly for odd sizes or questionable logs puts the burden of whether or not it is worthwhile on the customer.
Wood-Mizer LT40HDD51-WR Wireless, Kubota L48, Honda Rincon 650, TJ208 G-S, and a 60"LogRite!

uler3161

Yeah, that's way too high. On 1x6 pine, we'll cut our own logs, plane them and sell the boards for maybe that much or a little less.

Our cutting rates are .20/bdft regardless of size.

It's understandable wanting to charge more with a mill such as yours. It's a lot more work than having a fancy hydraulic mill. But at the same time it's hard to ignore what the market charges.
1989 LT40HD, WoodMaster 718

Dan

dgdrls

You are still cheaper than TSC but maybe not by enough.   
Since its a hobby IMHO you should be a little higher than the full time shops.
They need to eat too and its their primary income.  With that said maybe try $0.40/BF with a 200 BF min or "x" BF volume.  beyond that the fee drops.

I have also seen.  $350 Minimum  which covers mill transport and the first X amount of lumber.

Just some idea's to push around. 

Best
DGDrls



Tom the Sawyer

Gideon,

I just took a look at your site and the overall impression is pretty nice.  It appears that you have already reduced your rates considerably.  Perhaps too far if you cut much thin material.

I would be careful comparing prices on materials that you can not produce, e.g. comparing rates for 16' fencing boards is misleading if you can't cut anything longer than 10'. 

It should be quite clear to the reader that when you compare your rates to the big box stores, that your rates are for milling only and their prices are for lumber ready-to-use today (wood, milled, dried, planed and cut to length).

It is usually a good idea to have someone proof your work before you publish.  As hard as we try, another person's eye may catch math errors, typos or other inconsistencies that we may miss.    smiley_thumbsup
07 TK B-20, Custom log arch, 20' trailer w/log loading arch, F350 flatbed dually dump.  Piggy-back forklift.  LS tractor w/FEL, Bobcat S250 w/grapple, Stihl 025C 16", Husky 372XP 24/30" bars, Grizzly 20" planer, Nyle L200M DH kiln.
If you call and my wife says, "He's sawin logs", I ain't snoring.

Gideon_70

Thanks for everyones advice.  I reduced the rates and got a job a few minutes ago. 

I extended the track to 16 feet and am laying the new rails in the morning, or tonight if it doesn't rain (or I melt - *DanG it's hot today)

On my trip I found a place that pressure treats the lumber, and I'm going to check into that as well.

But I've already made some pretty significant changes, and the site is hopefully going to be getting me a little more weeeeerk (said like Mainerd T. Crebbs)  (Never mind if you're too young)
You cannot reduce crime by disarming the victims!

POSTON WIDEHEAD

I have customers that come as far as 70 miles away to bring logs.
Yes there are mill closer to them but these mills seem to be fishing at times hoping to get a bite from someone who has never had custom sawing done.
I charge 25 cents for softwood including Poplar and 30 cent for Hardwood and 35 cents for Pecan and Hickory.
These are my prices based on 1 inch lumber and up. $25.00 blade replacement fee for every piece of metal I hit.
I advertise my prices and I stay swamped with work. Am I making money? Yep!  ;D

The older I get I wish my body could Re-Gen.

ladylake

Quote from: Gideon_70 on August 09, 2014, 12:23:26 PM
http://www.woodcutterthingie.com

If you don't mind, take a look and tell me where I screwed up.

And yes, there were some mills in my area, but they eventually moved to a nearby area that has a lot more customers.  I'm a hobby mill and not really trying to make money out of it, but would like to pay it off eventually. The closest mill to me is about 45 minutes away.

The prices on your web site are right in line, your original post was way high. Did you just change your pricing or was your first post wrong..  Steve
Timberking B20  18000  hours +  Case75xt grapple + forks+8" snow bucket + dirt bucket   770 Oliver   Lots(too many) of chainsaws, Like the Echo saws and the Stihl and Husky     W5  Case loader   1  trailers  Wright sharpener     Suffolk  setter Volvo MCT125c skid loader

drobertson

If they are his logs, this is a real high saw charge around here, and would result in not very many conversations with anyone,  At that price it would make his price per bdft .91, no one around here would ever pay that for pine.
only have a few chain saws I'm not suppose to use, but will at times, one dog Dolly, pretty good dog, just not sure what for yet,  working on getting the gardening back in order, and kinda thinking on maybe a small bbq bizz,  thinking about it,

Joe Hillmann

I have a homemade mill that is completely manual so my production per day is probably similar to what you can do on your your mill. 

I figure if I charge $.40/bdft for sawing and I am providing a helper and paying him $10/hour I would end up earning anywhere from $2 to $15per hour after paying for blades, gas, lube, and what ever other expenses come with owning a mill (I didn't figure in deprecation of the mill or insurance).  If I were to charge the same $.40/bdft but the customer is or provides the helper/off bearer I would end up earning $12-$25per hour after expenses(also not counting deprecation or insurance).

Whether I am on the top end of that range or the bottom end depends a lot on the logs I am sawing,  logs that push the limit the limit of what the mill can handle take much longer than two smaller logs that add up to the same bdft which are easier to load,maneuver, and roll then the larger logs.  If the logs get too small the bdft/hour I can produce goes down as well.  I have the best production by milling 12-20inch logs.

Its also faster to produce 2"x lumber than 1"x lumber.

I would suggest sawing up a bunch of logs for yourself or friends or family and keeping detailed records of the hours worked, the bdft cut, the gas used per bdft, how many bdft you can get out of one sharpening, the cost of blade lube/solvent per bdft, oil changes and any other cost that goes with sawing.  Then you will have a good idea of your cost both per hour and per bdft then you can figure out what you would actually charge to make a profit.  With a smaller mill I think it could be very possible to charge what the local market charges for custom sawing and end up loosing money and not knowing it, so it is worth knowing your costs.

When I built my mill I only planed to use it for my own use but had several people ask me to saw for them so I started to keep track of my costs and came to the conclusion that most of the people would be better off finding someone with a fully hydraulic mill that charges more than I do than to hire me to do it.


Gideon_70

Quote
The prices on your web site are right in line, your original post was way high. Did you just change your pricing or was your first post wrong..  Steve

I changed it right then.  I use a CMS to manage my website, so it takes seconds to make a change.

The customer I went to see today had used a custom mill in the past, and my prices were in line with that he had done before, so I'm going to keep them where they are for a while, and see what happens.

Again, thanks to everyone for the advice.
You cannot reduce crime by disarming the victims!

WDH

I realized that I cannot compete with the higher production hydraulic mills.  So I don't.  I don't like to custom saw other people's logs, anyway.  I try to discourage it and refer them to other sawyers.  Custom sawing is not part of my business plan.  Why cut for $.30/BF when I can produce the same amount of lumber and sell it for $3.00/BF?   However, everyone is different, and some do very well custom sawing other people's lumber for $.25 - $.30 per BF.

So, if you want me to still cut your logs after I have begged tell you that you can get someone else to do it faster and cheaper, then I might do it, but it will cost you $.50/BF or $60/hour depending on how I feel.

Then, after hitting the first couple of nails when you swore that there was no metal in them logs, I ask myself, "Why am I doing this  ???  :)."

Or, I am sawing and sweat is pouring out of me, dripping off the end of my nose, and my safety glasses are fogged up, I ask myself, "Why am I doing this  ???  :)".

Bottom line, you cannot make it trying to custom saw with a manual sawmill.  Too much log handling, very physically demanding, and lower production.  This means that you are sawing for very little return at the competitive rates.  Life is too short for that. 

Woodmizer LT40HDD35, John Deere 2155, Kubota M5-111, Kubota L2501, Nyle L53 Dehumidification Kiln, and a passion for all things with leafs, twigs, and bark.  hamsleyhardwood.com

Magicman

That is a very accurate rendition from the manual world.  :P
Knothole Sawmill, LLC     '98 Wood-Mizer LT40SuperHydraulic   WM Million BF Club Member   WM Pro Sawyer Network

It's Weird being the Same Age as Old People

Never allow your "need" to make money to exceed your "desire" to provide quality service.....The Magicman

red oaks lumber

 danny pretty well summed up life with a manual mill. :)
the experts think i do things wrong
over 18 million b.f. processed and 7341 happy customers i disagree

drobertson

Quote from: Magicman on August 09, 2014, 08:55:45 PM
That is a very accurate rendition from the manual world.  :P
Knowing very little about manual mills, all I can say is My post was considering a hydraulic mill, for some reason I thought that's what was being used. 
only have a few chain saws I'm not suppose to use, but will at times, one dog Dolly, pretty good dog, just not sure what for yet,  working on getting the gardening back in order, and kinda thinking on maybe a small bbq bizz,  thinking about it,

POSTON WIDEHEAD

Yep....I was not considering a manuel mill either.  poston-smiley
The older I get I wish my body could Re-Gen.

Magicman

The fact whether the sawyer has a manual or full hydraulic sawmill should not affect the sawing bf rate (price), although it certainly would affect how much work the sawyer has to do to produce that lumber.

The customer needs to expect his logs to be sawn in a quality manner at that the same comparable rate.  It should not be his concern how hard the sawyer has to work to produce it.  Operating a manual sawmill and working harder also does not justify the sawyer charging a comparable hourly rate when his productivity will not equal a hydraulic sawmill producing a much higher lumber yield per hour.

I realize that there are those that do, but my feeling are directed toward the customer.  He is justified to expect quality lumber at a comparable bf rate.  Also, hourly rates should produce at that comparable bf rate.
Knothole Sawmill, LLC     '98 Wood-Mizer LT40SuperHydraulic   WM Million BF Club Member   WM Pro Sawyer Network

It's Weird being the Same Age as Old People

Never allow your "need" to make money to exceed your "desire" to provide quality service.....The Magicman

drobertson

Yea there's a lot of truth to that one MM,                 
only have a few chain saws I'm not suppose to use, but will at times, one dog Dolly, pretty good dog, just not sure what for yet,  working on getting the gardening back in order, and kinda thinking on maybe a small bbq bizz,  thinking about it,

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