Question
Let's not forget the purpose of the "Value-Added" wood products forum, i.e., "value-added" questions, topics, tips, etc. "Adding value" (money) through adding manufacturing steps, "adding value" by creative marketing, "adding value" by creating a new or improved product, etc. I believe questions/issues/ideas along these lines should be the focus of this forum. So let's put on our thinking caps and get the creative juices flowing!
Forum Responses
(Value Added Wood Processing)
From contributor Z:
I put the term "value added" in my book right after the term "high end". They are both such subjective terms that folks rarely agree on their use.
What I was doing was this: sawing free logs as available in my free time, but not carefully processing the wood. Sloppy foundations, sloppy alignment of sticks. Too-widely-spaced sticks. I have remedied this and now plan to step it up one more level by doing "small packs." What I mean by this is to subdivide all my stacks in parcels. Any given stack may have three to five subdivisions one on top of the other, divided by 3" or 4" thick blocking to allow each small pack to be lifted and placed on someone's trailer to take to their home or shop, leaving their money with me. The value added? No manual labor for me after that vertical stack of "small stacks" is done. More cash in the pocket.
So here is my point. The internet and its offshoots have created direct market methods which can bypass one or two "markups." If the producer of the product can direct-market, that producer can get the profit contained in those markups. Being closer to the end user means eliminating those layers of profit which go to someone else and putting that profit in your own business' pocket!
As far as demand, I always look at it this way. From a small manufacturer's point of view, there never really is a limit to the demand. For example, if I decided to produce face frame stock, I could not possibly produce enough face frame material for the entire cabinet market from my facility. If I ran 400 lineal ft. per minute through my machine around the clock, I doubt I would meet 20% of the global demand for face frame material and that's just one product.
To a certain extent, it takes volume for any business to succeed. I've noticed that the more material we move, the lower our cost per unit becomes. Basically, this happens because we have a certain amount of fixed expense which is factored into the cost of the product. This expense is the same whether I'm producing around the clock, or using my crew to get the new pellet machine working.
I think value added is great so long as it doesn't interfere with the normal flow of production and doesn't require a large capital investment. Maybe I'm overly conservative, but I generally believe that a penny saved is the same as a penny earned. Any way of reducing cost without sacrificing quality or efficiency is most attractive even from a value added standpoint.
Two years ago there was very little demand for 1" to 3" ERC poles. Today we sell tractor trailer loads, some aged, some new, some run through our German peeler that adds value by smoothing the log and getting rid of the bark. New markets have developed that let us add value by getting loggers to bring in ever smaller stems and having the equipment to peel some of these stems.
I think more in terms of increasing profit margin more so than just adding value. Using processes that add value that increase profits are the ones I look for. We developed the process for converting ERC on the ranchlands of Oklahoma into mulch. Landowners are tickled that we will remove these trees for free. We found a way to add value to what was formerly a cost to the landowner who had to pay to have them pushed up and burned. I discovered this by running ERC limbs with brown needles still on through our grinding hog in Indiana and sending the product to mulch companies to see if they liked it. There will always be new ways of adding value. Some require original thinking, some require research and development, some require new equipment, some require rethinking marketing, and some just require more efficient methods. The main thing is to not be complacent and feel that nothing can be improved.
Common Lumber Name | A | B | C |
Hardwoods | |||
Alder, Red | 9.9 | 19.2 | 2506 |
Apple | 10.9 | 31.7 | 4132 |
Ash, Black | 9.3 | 23.4 | 4132 |
Ash, Green | 14.3 | 27.6 | 3590 |
Aspen, Bigtooth | 10.3 | 18.7 | 2439 |
Aspen, Quaking | 10.3 | 18.2 | 2373 |
Basswood | 6.2 | 16.6 | 2174 |
Beech, American | 8.9 | 29.1 | 3793 |
Birch, Paper | 8.8 | 25.0 | 3260 |
Birch, Sweet | 11.9 | 31.2 | 4065 |
Birch, Yellow | 9.2 | 28.6 | 3723 |
Buckeye | 8.9 | 17.2 | 2235 |
Butternut | 11.3 | 18.7 | 2440 |
Cherry | 13.8 | 24.4 | 3184 |
Chesnut, American | 11.6 | 20.8 | 2708 |
Cottonwood | 8.5 | 16.1 | 2102 |
Dogwood | 6.8 | 33.3 | 4331 |
Elm, American | 10.2 | 23.9 | 3116 |
Elm, Rock | 12.2 | 29.6 | 3860 |
Elm, slippery | 11.5 | 25.0 | 3251 |
Hackberry | 11.8 | 25.5 | 3319 |
Hickory, Bitternut (Pecan) | 14.7 | 31.2 | 4062 |
Hickory (True) | |||
Hickory, Mockernut | 9.1 | 33.3 | 4332 |
Hickory, Pignut | 9.3 | 34.3 | 4332 |
Hickory, Shagbark | 10.9 | 33.3 | 4333 |
Hickory, Shellbark | 6.6 | 32.2 | 4195 |
Holly, American | 8.3 | 26.0 | 3387 |
Hophornbeam, Eastern | 7.9 | 32.8 | 4266 |
Laurel, California | 15.1 | 26.5 | 3456 |
Locust, Black | 21.2 | 34.3 | 4470 |
Madrone, Pacific | 7.8 | 30.2 | 3925 |
Maple (Soft) | |||
Maple, Bigleaf | 12.8 | 22.9 | 2980 |
Maple, Red | 13.1 | 25.5 | 3318 |
Maple, Silver | 12.4 | 22.9 | 2981 |
Maple (Hard) | |||
Maple, Black | 12.3 | 27.0 | 3523 |
Maple, Sugar | 12.3 | 29.1 | 3793 |
Oak (Red) | |||
Oak, Black | 11.7 | 29.1 | 3792 |
Oak, California black | 16.4 | 26.5 | 3455 |
Oak, Laurel | 6.3 | 29.1 | 3791 |
Oak, Northern red | 13.6 | 29.1 | 3793 |
Oak, Pin | 13.0 | 30.2 | 3928 |
Oak, Scarlet | 13.2 | 31.2 | 4065 |
Oak, Southern red | 9.6 | 27.0 | 3520 |
Oak, Water | 10.4 | 29.1 | 3793 |
Oak, Willow | 6.4 | 29.1 | 3790 |
Oak (White) | |||
Oak, Bur | 15.4 | 30.2 | 3928 |
Oak, Chestnut | 10.1 | 29.6 | 3858 |
Oak, Live | 17.5 | 41.6 | 5417 |
Oak, Overcup | 10.7 | 29.6 | 3860 |
Oak, Post | 11.0 | 31.2 | 4063 |
Oak, Swamp chestnut | 10.7 | 31.2 | 4063 |
Oak, White | 10.8 | 31.2 | 4062 |
Persimmon | 7.0 | 33.3 | 4332 |
Sweetgum | 8.9 | 23.9 | 3115 |
Sycamore | 10.7 | 23.9 | 3115 |
Tanoak | 9.0 | 30.2 | 3926 |
Tupelo, Black | 10.4 | 23.9 | 3116 |
Tupelo, Water | 12.4 | 23.9 | 3115 |
Walnut | 13.4 | 26.5 | 3454 |
Willow, Black | 8.6 | 18.7 | 2438 |
Yellow-poplar | 10.6 | 20.8 | 2708 |
Common Lumber Name | A | B | C |
Softwoods | |||
Baldcypress | 13.2 | 21.9 | 2844 |
Cedar, Alaska | 14.4 | 21.9 | 2844 |
Cedar, Atlantic white | 10.9 | 16.1 | 2100 |
Cedar, eastern red | 16.4 | 22.9 | 2981 |
Cedar, Incense | 13.1 | 18.2 | 2371 |
Cedar, Northern white | 11.1 | 15.1 | 1964 |
Cedar, Port-Orford | 12.6 | 20.2 | 2641 |
Cedar, Western red | 12.2 | 16.1 | 2100 |
Douglas-fir, Coast type | 12.3 | 23.4 | 3049 |
Douglas-fir, Interior west | 13.2 | 23.9 | 3116 |
Douglas-fir, Interior north | 14.0 | 23.4 | 3048 |
Fir, Balsam | 9.9 | 17.2 | 2236 |
Fir, California red | 10.6 | 18.7 | 2437 |
Fir, Grand | 10.7 | 18.2 | 2371 |
Fir, Noble | 10.1 | 19.2 | 2507 |
Fir, Pacific silver | 10.4 | 20.8 | 2711 |
Fir, Subalpine | 10.5 | 16.1 | 2101 |
Fir, White | 12.2 | 19.2 | 2506 |
Hemlock, Eastern | 12.6 | 19.8 | 2573 |
Hemlock, Western | 11.5 | 21.8 | 2847 |
Larch, Western | 11.3 | 25.0 | 3251 |
Pine, Eastern white | 12.3 | 17.7 | 2303 |
Pine, Lodgepole | 11.5 | 19.8 | 2576 |
Pine, Ponderosa | 12.6 | 19.8 | 2573 |
Pine, Red | 12.2 | 21.3 | 2777 |
Southern yellow group | |||
Pine, Loblolly | 12.9 | 24.4 | 3183 |
Pine, Longleaf | 15.0 | 28.1 | 3658 |
Pine, Shortleaf | 12.9 | 24.4 | 3183 |
Pine, Sugar | 12.6 | 17.7 | 2302 |
Pine, Western white | 10.0 | 18.2 | 2370 |
Redwood, Old growth | 14.9 | 19.8 | 2573 |
Redwood, Second growth | 13.2 | 17.7 | 2302 |
Spruce, Black | 11.3 | 19.8 | 2575 |
Spruce, Engelmann | 10.0 | 17.2 | 2234 |
Spruce, Red | 10.6 | 19.2 | 2506 |
Spruce, Sitka | 10.8 | 19.2 | 2506 |
Tamarack | 12.0 | 25.5 | 3318 |