In the past few years, the sawmill sector has been served several obstacles, including the fluid nature of global competition, housing booms and busts, and environmental concerns.
However, the intrinsic properties of wood make it a valuable industry. Demand for softwood and hardwood timber seems to be inexhaustible. As sawmills compete for raw materials and markets, you'll need to continuously adapt and improve your management processes to succeed.
Enhancing your sawmill business
Even though you may be able to operate alone for some time, a full-time operation needs competent assistance. The mill is only profitable when it is cutting wood, and you will quickly discover that most of your time will be spent procuring logs, communicating with clients, repairing machinery, sorting lumber, sharpening blades, and accounting.
Locate trustworthy assistance and compensate them enough to remain with the firm. A single sawmill can easily support you and at least two capable employees.
Understanding your competition
The key to success lies in specialising your business, and becoming well-known for a specific sawmill niche and you can develop this by studying your competitors.
For instance, Whitney Sawmills is a well-established British sawmill based in Herefordshire. Additionally, they are recognised for supplying rare and speciality hardwoods and softwoods that are in high demand for restoration projects, as well as furniture manufacturing and home construction.
There are multiple competitors out there, so you need to do your research and find out what threats and opportunities you may encounter.
Improving the marketing efforts of your business
Advertise your sawmill company in popular local newspapers and publications. These adverts should emphasise your business's unique selling points. Advertise your sawmill company on television and radio advertising or place banners and billboards that are promoting your business's name across your neighbourhood.
Reinventing your sawmill business
Sawmilling may be a profitable enterprise if the owner has a strategy and is able to stick to it long enough to simplify the operation, boost efficiency, increase production, and earn a profit. As with any company, this will take time and patience, but those who are more prepared to put in the work will reap the benefits.
Rather than continuously focusing one's efforts on multiple avenues, it may be more effective to focus on a single niche, and perfect it. For instance, massive overhead beams for residential construction and wood for furniture are two significant revenue streams.
Some interesting insights
- A report by Forest Research indicates that in 2020, 10.8 million green tonnes of roundwood (softwood and hardwood) were extracted, of which 6.0 million green tonnes came from sawmills.
- In 2020, UK sawmills consumed an astonishing 6.2 million green tonnes of softwood. England has the most sawmills, followed by Scotland and then Wales.
- Arbor Forest Products, situated in North Lincolnshire, is said to incoporate the most modern system in the UK, which includes unique scanning techonology.
Marketing strategies you need to conisder
Marketing is a critical component of any business's success in today's corporate environment. It is insufficient to rely just on word-of-mouth publicity. Advertisements in print media, advertising on social media platforms, and building a client base by offering materials or services at a discount are all strategies to establish a prominent presence.
Inbound marketing is a business approach for attracting consumers via the creation of useful content and experiences that are personalised for them.
This method may help you increase the number of visitors to your website. Hence, you could create a blog where you may publish articles on wood cutting and other relevant topics. Through the proliferation of such articles, you may demonstrate your knowledge and expertise in the field of wood cutting.
Financial support for your business
Keep in mind that a significant amount of your earnings will need to be reinvested in the firm. You'll want to have a continual stream of logs and lumber coming in and going out. A sawmill consumes around five gallons of gas each day, and the majority of the expenditures are associated with the initial purchase and replacement blades.
When you're ready to apply for financing, it's critical to recognise that each funding programme has its unique set of eligibility requirements. You can visit the Government website to explore different avenures of financial support, including loans, grants and advice.
Others in the same business have obtained capital ranging from £25,000 to £500,000.
What you need to consider if you want to exit
Lately, the industry's expansion has been stifled by increasing imports and alternative goods competition, according to IBISWorld. Additionally, economic uncertainty after the Brexit vote has dampened commercial building demand. A weaker housing market has stifled furniture manufacturing activity, significantly harming operators.
All of these challenges represent warning signs that you should be prepared at any time to switch the gears of your entrepreneurial journey. Make sure you have a plan in place to do so.
With a well-defined exit plan in place, you can organise your business with an end goal in mind. While you may not intend to sell it in the near future, unexpected circumstances, offers or external factors may change your mind.