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A good way for a small Sawmill to price their wood.

June 10, 2019

 

One of the most common questions I get through my You Tube channel is about pricing of wood.  I would wager that I get around 3 to 5 emails/DMs/text messages every week about the topic. I hope that this blog post will serve as a reference that I can point people to when that question comes up in the future.

 

When pricing your wood the first thing that you must realize that unless you live with in 60 miles of my sawmill what I charge for my products means nothing to you when pricing yours.  You must price your wood accordingly to what your market is where you live.   My pricing is something that took me a good bit of time to come up with based on market research for my region.  

 

I live in a small county, the closest city has a population of around 55k making that what most people would classify as rural.  The cost of living here is low which also reflects the wages being sub par also.  When pricing my wood I based it on the same principal that realtors use when putting houses on the market.  Realtors use the term comps which means houses comparable to the one they are listing which gives them a base line to work with when pricing homes.   I found sawmills both similar and bigger than my operation close to my region and got a copy of their price list which gave me a good starting point.  On some of the wood I am cheaper and some higher, just depends on my customers wants/needs and the price of Timber that I am paying.  Being the small region I am located I had to search out between 60 and 120 miles to find sawmills selling kiln dried wood, but they are out there if you just look.  

 

 

Some sawmills may be tempted to advertise their wood on local classifieds and Craigslist/Facebook Marketplace.  There is nothing wrong with that practice but remember not to market your wood with what I call Craigslist prices which are usually lower that what you should be getting.  As I mentioned above do your homework on established sawmills and their pricing and use that as your baseline for your own wood.  Also another thing to avoid is doing research online by seeing what companies are charging for what I call mail order wood.  Those companies in my research have unfair high prices that mirror another term I use called Disney wood. If you have ever been to Disney World you will know that everything there from the water to the popcorn to parking your car is ridiculous in what they charge.  Don't be tempted by those high Disney prices you see online, charge fair reasonable prices and you will be in it for  the long game and not just get up to bat a few times.  

 

Some people may disagree with this strategy or have a better one.  This is the approach I took a few years ago that has been a winner for me at my sawmill. Once again I will say what I charge for 8/4 figured Walnut in Northeast TN means nothing to what you would charge for the same board in Tampa Florida.

Do the research which will not only get your the best money for your wood but make you a better sawyer and business at the end of the day.

 

This post was not written out of spite or anger from the repetitive questions I get but to point people in the right direction when this topic comes up in the future, and gives you the reader more value at the end of the day.

 

 

If you found this helpful or have another approach leave me a comment down below. 

 

Thank you for reading and please share this post to anyone else that you might think it could help when dealing with this topic.

 

 

 

 

 

 

 

 

 

 

 

 

 

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