Are you about starting a logging company? If YES, here is a complete sample logging company business plan template & feasibility report you can use for FREE.
Okay, so we have considered all the requirements for starting a logging company. We also took it further by analyzing and drafting a sample logging business marketing plan template backed up by actionable guerrilla marketing ideas for logging businesses. So let’s proceed to the business planning section.
The logging industry is a very big industry in the united states of America. Logging companies are known to be major players in the house construction and forestry industry. Majority of the houses in the US are built with logs; hence the sales of log is tied to the real estate industry.
It is capital intensive to start a logging company because of the money required to purchase logging equipment and obtain licenses and permits. The industry is highly regulated by both the Federal and the State Governments and any logging company that is found on the wrong side of the law is always dealt with.
To start a logging company, you need to acquire some training; it could be a degree in Forestry or a College Diploma in Forestry Management. You should also ensure that you carry out your due diligence as it relates to market research, economic and cost analysis and of course feasibility studies.
If you get things right before launching your logging business, it will not take you long before you breakeven and start smiling to the bank. Below is a sample logging company business plan template that will help you successfully write yours with little or no stress.
A Sample Logging Company Business Plan Template
1. Industry Overview
Logging companies are involved in cutting, skidding, on-site processing, and loading of trees or logs onto trucks or skeleton cars.
The trees are then transported as saw logs to cottage companies such as sawmills and pulp mills et al. It is important to state that the logging industry does not include businesses that are involved in breeding, planting or growing trees. Companies that provide these services are classified under the Timber Services industry.
Logging business is indeed a big business and should not be handled with levity; little wonder there is a university degree dedicated for forestry. Part of what you need to do is to enroll for a degree or diploma in forestry and upon graduation; you can apply and work with a logging company or the forestry ministry in your country.
The truth is that when you are properly educated, it makes it easier for you to follow best practices in conducting your business. As a matter of fact, there are laws regulating the logging industry and it is your responsibility to ensure that you abide by the laws.
In the past five years, the industry has been in recovery mode, since construction activity has been climbing upward from recessionary low point, driving industry revenue. The conditions of the industry are expected to continue improving going forward, as recovery in the residential construction market is forecast to strengthen and home improvement spending rises.
On the other hand, paper manufacturing is forecast to slow due to the continued trend toward electronic communication, and of course reducing demand from key industrial players.
Statistics has it that in the United States of America alone, there are about 49,828 registered and licensed logging companies scattered all across the United States responsible for employing about 93,353 and the industry rakes in a whooping sum of $16 billion annually. The industry is projected to grow at 2.3 percent annual growth within 2011 and 2016. It is important to state that Weyerhaeuser has the lion market share of the available market in the industry.
A recent report published by IBISWORLD shows that the Logging industry has medium barriers to entry due to the various regulations and policies that logging companies must comply with as well as the high level of competition within the industry.
The report further stated that the industry regulations primarily focus on environmental factors that include: The Clean Air Act, the Clean Water Act, the Endangered Species Act and the Toxic Substances Control Act, which regulate the use of fire, chemicals and timber extraction in timber tracts.
The report also stated that despite the fact that there is a high level of regulation, the industry also benefits from government assistance provided by the US Forest Service, the Sustainable Forestry Implementation Committee and the National Resources Conservation Service, as well as some protectionist trade policies.
One factor that encourages entrepreneurs to start their own logging company is that the business is highly profitable especially when it is properly located. Even though the business is not a Green business, the truth is that it will continue to remain relevant as long as logs and other products manufactured by loggers are still in use in our world.
Lastly, it is important to state that the Logging industry is highly regulated in the United States of America and anyone who aspires to start a logging company must apply and obtain a license before they can legally operate in the industry.
2. Executive Summary
Shadrach McLaurin® Timber & Logging Company is a registered logging company that will be located in Northern Virginia – Virginia. We have been able to secure all the needed state and federal licenses and permits that will enable us operate the business in Northern Virginia – Virginia.
Shadrach McLaurin® Timber & Logging Company will be involved in cutting, skidding, on-site processing, and loading of trees or logs onto trucks or skeleton cars.
Shadrach McLaurin® Timber & Logging Company will ensure that all our customers are given first class treatment whenever they contact us or patronize our services. We have a CRM software that will enable us manage a one on one relationship with our customers no matter how large they are.
Shadrach McLaurin® Timber & Logging Company will at all times demonstrate her commitment to sustainability, both individually and as a firm, by actively participating in our communities and integrating sustainable business practices wherever possible. We will ensure that we hold ourselves accountable to the highest standards by meeting our customers’ needs precisely and completely whenever they patronize our products.
Shadrach McLaurin® Timber & Logging Company is a family business that is owned by Shadrach McLaurin and his immediate family members. Shadrach McLaurin has a B.Sc. in Forestry and he has several certifications such as Master Logger Certification | Certified Loggers, Certified Logging Professional – CLP, LEAP Certified Loggers, Wisconsin Master Logger Certification: WIMLC and Trained Logger Certification (TLC) with over 15 years’ experience in the logging industry.
3. Our Products and Services
Shadrach McLaurin® Timber & Logging Company is in the logging industry to service a wide range of clients and of course to make profits, which is why we will ensure we service a wide range of clients. Our product offerings are listed below;
- Cutting, skidding, on-site processing, and selling/supply of trees or logs
- Softwood logs and bolts
- Hardwood logs and bolts
- Pulpwood manufacturing
- Cutting timber
- Transporting timber
4. Our Mission and Vision Statement
- Our vision is to become the leading brand in the logging industry in Northern Virginia – Virginia and with license to operate all across the United States of America.
- Our mission is to establish a world-class logging company that will work with clients all across the United States of America and the globe via supply/export of processed logs.
Our Business Structure
At Shadrach McLaurin® Timber & Logging Company, our business structure will be designed in such a way that it can accommodate but full – time and part – time/contract staff. We intend starting out with a handful of full time employees and adequate provision and competitive packages have been prepared for all our full – time employees.
As a means of maximizing operational cost, we will contract the maintenance of all our machines and trucks to a service provider, we don’t intend to maintain a very large overhead from the onset. But as soon as the business grows and stabilizes, we will assemble our own in-house maintenance team.
Below is the business structure and the roles that will be available at Shadrach McLaurin® Timber & Logging Company;
- Chief Operating Officer (Owner)
- Admin and HR Manager
- Transport and Logistics Manager
- Business Developer
- Loggers and Processing Machine Operators
- Professional Truck Drivers
- Client Service Executive/Front Desk Officer
5. Job Roles and Responsibilities
Chief Executive Officer – CEO:
- Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results and developing incentives
- Accountable for fixing prices and signing business deals
- Responsible for providing direction for the business
- Creates, communicates, and implements the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
- Responsible for signing checks and documents on behalf of the company
- Evaluates the success of the organization
Admin and HR Manager
- Responsible for overseeing the smooth running of HR and administrative tasks for the organization
- Maintains office supplies by checking stocks; placing and expediting orders; evaluating new products.
- Ensures operation of equipment by completing preventive maintenance requirements; calling for repairs.
- Defines job positions for recruitment and managing interviewing process
- Carries out induction for new team members
- Responsible for training, evaluation and assessment of employees
- Responsible for arranging travel, meetings and appointments
- Oversees the smooth running of the daily office activities.
Sales and Marketing Manager
- Manages external research and coordinate all the internal sources of information to retain the organizations’ best customers and attract new ones
- Models demographic information and analyze the volumes of transactional data generated by customer purchases
- Identifies, prioritizes, and reaches out to new partners, and business opportunities et al
- Identifies development opportunities; follows up on development leads and contacts
- Documents all customer contact and information
- Represents the company in strategic meetings
- Helps to increase sales and growth for the company
Transport and Logistics Manager
- Accountable for coordinating truck drivers, vehicles, loads and journeys
- Accountable for developing and confirming schedules
- Handles the planning routes and load scheduling for multi-drop deliveries.
- Handles booking in deliveries and liaising with customers.
- In charge of allocating and recording resources and movements on the transport planning system.
- Responsible for ensuring all partners in the supply chain are working effectively and efficiently to ensure smooth operations.
- In charge of directing all transportation activities.
- Responsible for developing transportation relationships.
- Accountable for monitoring transport costs.
- Responsible for preparing financial reports, budgets, and financial statements for the organization
- Provides managers with financial analyses, development budgets, and accounting reports
- Responsible for financial forecasting and risks analysis.
- Performs cash management, general ledger accounting, and financial reporting
- Accountable for developing and managing financial systems and policies
- Responsible for administering payrolls
- Ensuring compliance with taxation legislation
- Handles all financial transactions for the company
- Serves as internal auditor for the company
Timber Harvesting and Processing Machine Operators
- Responsible for cutting, skidding, on-site processing, and selling/supply of trees or logs
- Responsible for processing softwood logs and bolts
- Responsible for processing hardwood logs and bolts
- Responsible for pulpwood manufacturing
- Responsible for cutting timber
- Responsible for producing wood chips in the field
- Assist in loading and unloading timbers
- Responsible for transporting timbers
- Assists in loading and unloading timbers
- Maintains a logbook of their driving activities to ensure compliance with federal regulations governing the rest and work periods for operators.
- Keeps a record of vehicle inspections and make sure the truck is equipped with safety equipment, such as hazardous material placards.
- Inspects vehicles for mechanical items and safety issues and perform preventative maintenance
- Complies with truck driving rules and regulations (size, weight, route designations, parking, break periods etc.) as well as with company policies and procedures
Client Service Executive
- Welcomes/receive clients by greeting them in person or on the telephone; answering or directing inquiries.
- Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
- Through interaction with parents and students on the phone, uses every opportunity to build clients’ interest in the organizations’ products and services
- Consistently stays abreast of any new information on the organizations’ products, promotional campaigns etc. to ensure accurate and helpful information is supplied to clients when they make enquiries
- Receives parcels / documents for Shadrach McLaurin® Timber & Logging Company and distribute mails in the organization
- Handles any other duties as assigned by HR and Admin Manager or Transport & Logistic Manager.
6. SWOT Analysis
Our aim of starting Shadrach McLaurin® Timber & Logging Company in Northern Virginia is to test run the business for a period of 2 to 4 years to know if we will invest more money and expand the business all around in the United States.
We know that there are several logging companies scattered all over the United States of America and even in the same locations where we intend starting ours, which is why we are following the due process of establishing a business.
We know that if a proper SWOT analysis is conducted for our business, we will be able to position our business to maximize our strengths, leverage on the opportunities that will be available to us, mitigate our risks and be equipped to confront our threats.
Shadrach McLaurin® Timber & Logging Company hired the services of an expert HR and Business Analyst with bias in startups to help us conduct a thorough SWOT analysis and to help us create a Business model that will help us achieve our business goals and objectives.
Below is the summary of the SWOT analysis that was conducted for Shadrach McLaurin® Timber & Logging Company;
Part of our strength is the power of our team; our workforce. We have a team that is trained and equipped to pay attention to details and to deliver excellent jobs. We are well positioned and we have standard and reliable timber harvesting and processing machines and trucks. We know we will attract loads of clients from the first day we open our door for business.
Our weakness could be lack of finance, high debt burden, cost structure, lack of scale compared to our peers who have already gained ground in the logging industry and have the capacity to supply logs to any part of the United States of America.
The opportunities that are available to us as a logging company operating in the United States of America are online market, new services, new technology, and of course the opening of new markets within our target locations.
Some of the threats that we are likely going to face are mature markets, bad economy (economy downturn), stiff competition, volatile costs, and rising fuel prices. Another threat that may likely confront us is the arrival of a logging company in same location where ours is located. unfavorable government policies can also pose a major threat to businesses such as ours.
7. MARKET ANALYSIS
- Market Trends
The market trends as it involves the logging industry in the United States of America are indeed dynamic and at the same time highly competitive and challenging. But one thing is certain, once a logging company can gain credibility, it will be much easier for the company to secure permanent deals with big time construction companies, furniture manufacturers and paper production companies.
If you are a close observer of the trends in the logging industry, you will notice that the revenue generated by players in the industry has registered a sharp increase over the last half decade. This is supported by the increase in demand from downstream construction industries.
So also, improvement in the performance from the industry matched with the rapid expansion in demand for timber in the booming housing and nonresidential building market in the United States. Going forward, industry revenue is expected to continue growing, albeit at a slower pace.
Another common trend in this industry is that once a logging company has gained credibility, it is easier for them to go for brand new trucks and timber harvesting and processing machines as against making use of second hand trucks and machines which are usually expensive to maintain due to constant wear and tear.
8. Our Target Market
Our target market is basically construction companies, woodworking companies and of course any other company that makes use of timber. We cover both short distance (interstate) and long distance (intra state). We are in business to harvest, process and supply timbers within the United States.
In other words, our target market is the whole of the United States of America and below is a list of the people and organizations that we have plans to do business with;
- Construction companies
- Woodworking companies
- Paper Pulp companies
- Furniture manufacturers
- Cottage companies that make use of processed timbers
Our competitive advantage
Our major competitive advantage is the vast industry experience and solid reputation of the chief executive officer of the company and our management team.
We took our time to do a thorough market research and feasibility studies before launching the business. We were able to highlight some factors that will give us competitive advantage in the marketplace;
- Some of the factors are trust, honesty, good network and excellent relationship management, well – qualified and experienced management team, robust fleet operations, direct access to forests and construction sites in the United States of America, our size advantages, cost advantages, supply chain, customer loyalty and strong reputation amongst domestic industry players.
Another competitive advantage that we are bringing to the industry is the fact that we have designed our business in such a way that we can comfortably work with both individual clients (contractors) and big construction companies.
Lastly, our employees will be well taken care of, and their welfare package will be among the best within our category in the industry, meaning that they will be more than willing to build the business with us and help deliver our set goals and achieve all our business aims and objectives.
9. SALES AND MARKETING STRATEG
Shadrach McLaurin® Timber & Logging Company will ensure that we leverage on our strength and the opportunities available to us to generate enough income that will help us drive the business to stability. Below are the sources we intend exploring to generate income for Shadrach McLaurin® Timber & Logging Company;
- Cutting, skidding, on-site processing, and selling / supply of trees or logs
- Softwood logs and bolts
- Hardwood logs and bolts
- Pulpwood manufacturing
- Cutting timber
10. Sales Forecast
We are well positioned to take on the available market in the United States of America and we are quite optimistic that we will meet our set target of generating enough income / profits from the first six months of operation and grow our business and our clientele base.
We have been able to critically examine the logging industry market in the United States of America, we have analyzed our chances in the industry and we have been able to come up with the following sales forecast. Below are the sales projections for Shadrach McLaurin® Timber & Logging Company, it is based on the location of our company and of course other related services that we will be offering;
- First Fiscal Year: $250,000
- Second Fiscal Year: $550,000
- Third Fiscal Year: $900,000
N.B: This projection was done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown and natural disasters within the period stated above. So also, there won’t be any major competitor (logging company) offering same services as we do within same location. Please note that the above projection might be lower and at the same time it might be higher.
- Marketing Strategy and Sales Strategy
We are aware that networking is an effective way to begin building your client base and we have plans in place to leverage on all our networks. In view of that, we will look out for gatherings where we can network with captains of industries, construction contractors, paper manufacturing companies, woodworking companies and furniture manufacturing companies et al.
As a matter of fact, our first port of call will be to connect with the nearest Chamber of Commerce; we are likely going to get our first major deal from them.
At Shadrach McLaurin® Timber & Logging Company, all our employees will be directly or indirectly involved in sales and marketing. We will create provision for our employees to earn commission when they bring in business for the organization. We will also encourage freelancers to work with us; whenever they refer clients to us they will earn a percentage of the deal as agreed by both parties.
Lastly, we will leverage on the power of the media by advertising our services using both online and offline platforms. We will work hard to ensure that we get repeat business from any business deal we execute and also, we will encourage our customers to help us refer their friends to us. Part of our strategy is to reward loyal customers and to leverage on word of mouth marketing from satisfied customers.
In summary, Shadrach McLaurin® Timber & Logging Company will adopt the following sales and marketing strategies in sourcing for clients for our business;
- Introduce our business by sending introductory letters alongside our brochure to corporate organizations, businesses in the construction industry, paper manufacturers, furniture manufacturers, woodworking companies and related industries in Northern Virginia and throughout the United States
- Print handbills about our logging company and its location and drop them in public facilities.
- Advertise on the internet on blogs and forums, and also on social media like Twitter, Facebook, LinkedIn to get our message across
- Creating a basic website for our business, so as to give our business an online presence
- Directly market our business.
- Join local logging company associations and chambers of commerce for industry trends and tips
- Provide discount days for our customers
- Advertise our business in community – based newspapers, local TV and radio stations
- List our business on yellow pages’ ads (local directories)
- Encourage the use of Word of mouth marketing (referrals)
11. Publicity and Advertising Strategy
Despite the fact that our excavation company will be well located, we will still go ahead to intensify publicity for the business. We are going to explore all available means to promote our business.
Shadrach McLaurin® Timber & Logging Company has a long – term plan of operating in various locations (major timber sites) in the United States which is why we will deliberately build our brand to be well accepted in Northern Virginia – Virginia before venturing out to other cities in the United States of America.
Here are the platforms we intend leveraging on to promote and advertise Shadrach McLaurin® Timber & Logging Company;
- Place adverts on both print (community – based newspapers and magazines) and electronic media platforms
- Sponsor relevant community programs
- Leverage on the internet and social media platforms like; Instagram, Facebook, Twitter, et al to promote our brand
- Install our billboards in strategic locations all around Northern Virginia – Virginia
- Distribute our fliers and handbills in target areas
- Position our Flexi Banners at strategic positions in the location where our photo booths are located.
- Ensure that all our workers wear our branded shirts and all our trucks are well branded with our company’s logo et al.
12. Our Pricing Strategy
Shadrach McLaurin® Timber & Logging Company has a lease arrangement with various companies and the company’s pricing is based on miles per thousands of tons of processed logs transported. We have perfected our plans to charge competitive rates since we have minimal overhead compared to our competition in the industry.
We will ensure that we leverage on price to win over customers; our prices will be affordable and negotiable. The fact that our business door is open to both individuals and corporation organizations means that we will have different price range for different category of clients.
We are aware that government contracts come with a bidding template, we will ensure that we abide by such bidding templates whenever we have the opportunity to bid for government contracts. As the business grow, we will continue to review our pricing system to accommodate a wide range of clientele.
- Payment Options
The payment policy adopted by Shadrach McLaurin® Timber & Logging Company is all inclusive because we are quite aware that different customers prefer different payment options as it suits them but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America.
Here are the payment options that Shadrach McLaurin® Timber & Logging Company will make available to her clients;
- Payment via bank transfer
- Payment via credit cards / Point of Sale Machines (POS Machines)
- Payment via online bank transfer
- Payment via check
- Payment via mobile money transfer
- Payment via bank draft
In view of the above, we have chosen banking platforms that will enable our clients make payment for logs purchased without any stress on their part. Our bank account numbers will be made available on our website and promotional materials.
13. Startup Expenditure (Budget)
When it comes to starting a logging company, the major areas that you look towards spending the bulk of your cash is in the purchase of standard timber harvesting and processing machines and trucks and of course renting or leasing a well-located facility / yard large enough to accommodate your trucks and processing plant. You are also expected to pay your employees, maintain your trucks and fuel them.
These are the key areas where we will spend our startup capital;
- The total fee for incorporating the Business in the United States of America – $750.
- The budget for liability insurance, permits and license – $2,500
- The amount needed to acquire a suitable office facility with enough parking space for our trucks in Northern Virginia for 6 months (Re – Construction of the facility inclusive) – $40,000.
- The amount required to finance the purchase of the first set of trucks and timber harvesting and processing machines – $200,000
- The cost for equipping the office (computers, printers, fax machines, furniture, telephones, filing cabins, safety gadgets and electronics et al) – $5,000
- The cost of accounting software, CRM software and Payroll Software – $3,000
- Other start-up expenses including stationery – $1000
- Phone and Utilities (gas, sewer, water and electric) deposits – ($3,500).
- Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $40,000
- The cost of launching our official website – $600
- The amount needed to pay staff for the first 2 months – $20,000
- Additional Expenditure (Business cards, Signage, Adverts and Promotions et al) – $2,500
Going by the report from the market research and feasibility studies conducted, we will need about three hundred and fifty thousand (350,000) U.S. dollars to successfully set up a medium scale but standard logging company in the United States of America.
Generating Startup Capital for Shadrach McLaurin® Timber & Logging Company
Shadrach McLaurin® Timber & Logging Company is a family business that will be owned and managed by Shadrach McLaurin and his immediate family members. They decided to restrict the sourcing of the startup capital to just three major sources.
- Generate part of the startup capital from personal savings and sale of his stocks
- Generate part of the startup capital from friends and other extended family members
- Generate a larger chunk of the startup capital from the bank (loan facility).
N.B: We have been able to generate about $100,000 (Personal savings $80,000 and soft loan from family members $20,000) and we are at the final stages of obtaining a loan facility of $200,000 from our bank. All the papers and documents have been duly signed and submitted, the loan has been approved and any moment from now our account will be credited.
14. Sustainability and Expansion Strategy
The future of any business lies in the number of loyal customers that they have, the capacity and competence of their employees, their investment strategy and business structure. If all of these factors are missing from a business, then it won’t be too long before the business close shop.
One of our major goals of starting Shadrach McLaurin® Timber & Logging Company is to build a business that will survive off its own cash flow without injecting finance from external sources once the business is officially running. We know that one of the ways of gaining approval and winning customers over is to engage in affordable, timely, safe and efficient log harvesting, processing and supply.
Shadrach McLaurin® Timber & Logging Company will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare are well taken of. Our company’s corporate culture is designed to drive our business to greater heights and training and retraining of our workforce is at the top burner.
As a matter of fact, profit-sharing arrangement will be made available to all our management staff and it will be based on their performance for a period of three years or more. We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.
- Business Name Availability Check: Completed
- Business Incorporation: Completed
- Opening of Corporate Bank Accounts: Completed
- Opening Online Payment Platforms: Completed
- Application and Obtaining Tax Payer’s ID: In Progress
- Application for business license and permit: Completed
- Purchase of Insurance for the Business: Completed
- Acquiring of trucks and relevant equipment: In progress
- Leasing of Office Facility/Yard large enough in Northern Virginia – Virginia: Completed
- Conducting Feasibility Studies: Completed
- Startup Capital Generation: Completed
- Writing of Business Plan: Completed
- Drafting of Employee’s Handbook: Completed
- Drafting of Contract Documents: In Progress
- Design of The Company’s Logo: Completed
- Printing of Promotional Materials: Completed
- Recruitment of employees and drivers: In Progress
- Purchase of the needed furniture, office equipment, electronic appliances and facility face lift: In progress
- Creating Official Website for the Company: In Progress
- Creating Awareness for the business (Business PR): In Progress
- Health and Safety and Fire Safety Arrangement: In Progress
- Establishing business relationship with key players in the construction industry, woodworking companies, furniture making industry and paper manufacturing industry: In Progress
- Leasing of the first set of log harvesting and processing machines and trucks: In Progress