A retail lumber business?

Tips for success in a start-up sawmill-to-retail business. January 16, 2001

My partner and I own a Woodmizer LT40 Superhydraulic mill here in Oregon. My partner owns a large commercial building in a great location across from an established lumberyard.

A man who owns six hundred acres of soft and hardwoods wants to treefarm his property through our mill and retail store for years to come. We would sell high-grade lumber. There are also many portable mills in our area and our store could possibly be an outlet for other mill owners. Any advice?

Forum Responses
There is a growing interest in West Coast hardwoods such as chinkapin, madrone, tan oak and alder. Those along with thick or high grade softwoods would no doubt bring you some success.

Have every piece displayed with a price. Visit a few retail operations to see how they do it. Many cabinet shops need wood early in the day, so be open then. Plan on hobbyists on Saturdays. Correct MC is the key to repeat business. Advertise locally and be prepared to ship pieces to schools, small shops, etc. Planed lumber will sell much faster than rough. Have an MC meter (on a chain so it does not walk away) available for the customers. If you get a moulder, your business will probably double. Make contact with an eastern dealer (such as Yukon Lumber in Norfolk, VA) to supply eastern species (maybe you can trade eastern for western?). Marketing is another key.

Gene Wengert, forum technical expert

I have owned and run a retail store for 10 years. I have to agree that quality processed lumber (millwork) sells better than rough sawn. We have consistently sold door jamb, casing, stop, custom millwork, and S2S 1 x stock. We are a small operation and our door parts and millwork are solid high grade material, versus the finger jointed stuff sold by the big box stores.

For years we bought rough sawn from the local sawmill and recently graduated to sawing and drying our own lumber.

Don't overlook the rehabber market if you are in a big city. We are at record sales levels with this, here in Chicago. Local homes have a lot of lead paint and removing it is expensive. So many rehabbers elect to replace doors and millwork if the price is right.

If you or your partner plan on running the store yourself you might consider keeping some equipment on hand (planer, table saw, ect.) for projects during the slow part of the day.

The comments below were added after this Forum discussion was archived as a Knowledge Base article (add your comment).

Comment from contributor A:
Lumber is a very competitive business, especially if the competitor is on the other side of the street. This obviously keeps margins low.

Anything you do to add value can give you a chance for higher profits. Have you considered kit projects for do-it-yourselfers?