Farming Magazine - September, 2012
FOREST PRODUCTS EQUIPMENT
The Right Kind of Fire Sale
Different ways toward success in the firewood business
Firewood may seem to be a pretty generic product, but really there isn't much that's uniform about it. Every piece is different, and there are just as many different ways to process and market firewood. For those who sell firewood, customizing their businesses in specific ways allows them to reach customers and keep them coming back.
Miracle Farms Landscaping in New Hampshire processes up to 500 cords of firewood per year with its Multitek processor.
Photos courtesy of Miracle Farms Landscaping.
Chris Maroun, owner of Miracle Farms Landscaping (www.miraclefarmslandscaping.com) in Moultonboro, N.H., invested in a Multitek 2025 LDCS firewood processor several years ago. "It's a great machine, the production has been terrific," says Maroun. "I love it." When he selected the machine, his goal was to sell about 200 cords per year, which is the volume he calculated he would need to sell in order to make payments on the machine while still turning a small profit. It turns out he's been selling between 400 and 500 cords over the last few years. "Obviously the more you produce, the better it pays and the quicker it pays, so the machine is really paying for itself," he says.
Maroun says that, given the increased volume of firewood he's processing, if he had to do one thing differently, it would have been to upgrade to a Multitek model with a chop saw blade as opposed to a bar and chain. "It was more expensive. My processor was around $85,000 four years ago, and it was an additional $15,000 or $20,000 to get the chop saw option. In hindsight I wish I had done that, because it saves on changing bars and chains and oil - over the years that adds up. My next processor will have the chop saw."
Selling more than twice the firewood he had expected has posed a challenge in putting together the necessary supply of raw logs. "This year in particular I struggled a little bit, but I went and saw as many people as I could," says Maroun. "And I made a point of paying well. If you pay well, you'll always get the wood over the guy who doesn't." He had to pay an additional $25 per cord for the logs, and thus had to increase his prices for processed firewood by the same amount.
Miracle Farms Landscaping has found ways to market several different types of firewood products. For example, Maroun's processor allows him to produce firewood at the standard 16 inches and all the way up to 30 inches. He says he's found a market for that larger wood among those with outdoor wood boilers.
Customers can also choose to purchase palletized firewood. "That's been good for us," Maroun explains. There is extra labor cost because the wood is stacked (three 16-inch rows stacked 4 feet high) on the pallets by hand. There's also more expense in delivery because the company's Bobcat must be trailered along with the wood in order to unload the pallets, which contain exactly half a cord. However, he's able to charge more for the wood: $250 for the half-cord pallets. Miracle Farms Landscaping sells about 40 cords of wood a year on pallets, primarily to those for whom cost is a secondary consideration to convenience. "People are always looking for a way to have wood that's neat and tidy, and where they don't have to stack it. If our Bobcat fits into their garage, oftentimes we'll slide a pallet or two right into the garage for them," says Maroun. "I think down the road we'll probably end up getting a Moffett [truck-mounted forklift]."
For customers looking for the lowest-cost firewood option, Maroun steers them toward green wood. He sells that for $200 a cord versus $300 for dry wood. "I actually encourage people to buy the green wood," he explains. "I ask them where else they can make 33 percent on their money today. And they don't have to do anything, just stack it and let it dry. We put an ad in the paper that says, 'Buy Green and Save Your Green.'" Maroun says it also works out better for him when customers select green wood. "For starters, I never have enough dry wood, no matter how hard I try, so I'd rather sell the green wood. Plus, when wood is green there is no mess; people love it. It's after wood dries that the bark starts to fall off, and that's what makes the mess."
Maroun says that people don't tend to be loyal in where they purchase firewood from year to year. "One of the biggest things is selling clean firewood. If you can deliver people clean firewood, they'll keep buying from you," he states. Toward that goal, he's built a grate system. After the wood has been dried, the wood is dropped onto this grate, which is about 12 feet long and is composed of a series of tubes spaced about 3 inches apart. "All the crud and the loose bark falls off and falls down through, and then the wood slides down into a clean pile," Maroun explains.
Marketing firewood is often more challenging than processing it. While Miracle Farms Landscaping has built up a strong base of customers, it's important to keep the company name out there and maintain a visible presence. "We have a great location. I have the processor in a place where people can see it, and then I have about 120 or 130 cords of firewood piled up really high so people can see it when they drive by," says Maroun. "Then we have our truck loaded up with wood and we park it in the lot every weekend ... People see it and that's the number they call." He emphasizes that showing people the firewood is the best way to let them know where they can buy it.
Out in western New York, marketing is a full-time effort at Forest Products Firewood, Inc. (www.forestproductsinc.com). The company has been in business for 31 years and has a database of about 12,000 current and past firewood customers in its computer, so advertising isn't as important as merely making contact with those customers, explains Cindie Clay, who runs the company with her husband, Rich. "We call all of our customers as a reminder to order firewood," she says. "We do it every month. We call each customer at the month of their choosing."
Clay says that the emerald ash borer has had a huge impact on the firewood business in that area. The company, which mainly buys firewood that's already been processed, cannot get wood from more than 50 miles away, and it can't cross state borders, which has made finding a suitable supply challenging. Clay says that at its peak six or seven years ago the company sold almost 5,000 face cords per year. That number has dropped to about 2,000 face cords. In addition to the effect of the emerald ash borer quarantine, Clay says, "I think the economy has also had an impact; people just aren't spending the money anymore. The people who like firewood are still buying the same amount, it's just less people who are buying it." The price of firewood has had to go up every year to keep pace with increased costs of fuel and the expense of trucking firewood, she adds. The company uses delivery distance to determine the per-cord cost for different customers.
Rich feels that part of the reason he's seen demand for firewood wane some in recent years has to do with a new generation of homeowners and the types of homes they buy. "Most new homes do not include wood-burning fireplaces. The younger generation who are buying these homes don't seem to want to fuss with it," he notes. "And the older generation is spending more time away in the winter, so that has an impact on demand as well."
In Massachusetts, it's also possible to see a difference in firewood demand among a new generation, says Ed Plugis, who helps his son James run Firewood-Inc.com (www.firewood-inc.com). "People don't buy firewood unless they need it, and they don't buy it before they need it," he explains. "If people need wood on Saturday, they'll call on Friday." It's a challenge to deliver wood to customers on such short notice, but that's the nature of the firewood business today, and something you need to be prepared for, he says.
Firewood-Inc.com buys a large amount of wood already split and also splits some logs using a Super Splitter to process the firewood. The manufacturer of that splitter reports that the machine is designed to "fill the gap" between slower hydraulic wood splitters and more expensive firewood processors. "It's not hydraulic, it's a mechanical splitter," explains Plugis. "It works pretty fast."
Chester County Firewood (www.chestercountyfirewood.com) in Pennsylvania sells 400 to 500 cords per year and processes firewood with a combination of both new and old technology. In addition to a Bandit firewood processor, the company has six or seven employees who only use axes. "They don't want anything to do with modern-day machinery. They want to use axes, and some of them can do 5 cords in a day that way," says owner Mike DiEugenio.
In most cases the wood is sold in half-cord and full-cord quantities, but DiEugenio says he's seen a trend in recent years of customers ordering larger amounts of wood. "They're ordering more, for sure," he explains. "We're seeing more 2 to 4-cord orders, and we just got a 6-cord order. With the price of oil, a lot of people are using firewood more for heat."
For Chester County Firewood, word-of-mouth has been the best form of marketing, says DiEugenio. "That and repeat business are really important when it comes to firewood." In addition to his residential customers, he is also heavily involved in the restaurant market. "Restaurants are one of our biggest areas. They use the wood for cooking - steaks, pizzas, things like that," he explains. Typically restaurants want the firewood split a little smaller and look for specialty woods, such as apple and cherry. It's proof that firewood is anything but generic, and there is more than one way to process and market this unique product.
Patrick White is a freelance writer based in Middlesex, Vt. For more than 15 years, he has covered a wide range of agricultural operations around the Northeast. He is always on the lookout for interesting and unusual stories. Comment or question? Visit www.farmingforumsite.com and join in the discussions.