Sawmill business plan with calculations 2020

A sawmill is a workshop in which wood is processed using special machines. Today, this business can be called one of the most relevant and in demand, which makes such a project attractive. This is associated with an increase in the construction of dachas, houses, bathhouses, as well as prefabricated wooden structures. Below is a business plan for a sawmill with calculations, which can help you understand the features of the direction.

Analysis of the sawmill market and competitors

Any business plan begins with market analytics, as well as its main players. This will help you accurately determine the possibility of entering this industry, understand the profitability of the market, understand which competitors you will have to fight with and what methods are used for this. In order to analyze the market, it is recommended to consider the following factors:

You need to understand whether this industry has prospects. As mentioned above, sawmills are a fairly relevant type of business, which are in demand due to the increased volumes of low-rise construction. However, the situation may be different in different regions.
How many sawmills and similar enterprises operate in your region? By answering this question, you can understand what competitors you have and how many there are. Among the direct competitors of sawmills are large manufacturing companies that can cover large market volumes.
How accessible are the raw materials and how easily can the finished product be sold at the desired price? This factor will help you understand how quickly you can get your business up and running, and how soon it will begin to bring you a stable profit.

A good option would be to study not only your direct and secondary competitors, but also logistics in the region. The logging process involves the use of a rather complex logistics system. At the initial stage, the wood is transported to the sawmill; after processing, the materials are sent to the client. Remember that a very important factor will be the availability of good roads and access to the point of business in the region. If this condition is not met, your costs may increase significantly due to logistics costs.

Remember that raw materials must be easily accessible. This is important if you want to establish a continuous supply of timber. In most regions of the Russian Federation, the removal and felling of forests will present some difficulty. Be sure to study local laws when choosing a location.

Market and risk assessment

A sawmill business plan begins with an assessment of the market. To analyze it, you need to consider the following factors:

the demand for lumber in the area where the sawmill is planned to open;
the number of sawmills in the region, especially large companies that capture a large market share and will become direct competitors;
Local legislation, which in many regions of Russia prevents the felling and removal of forests, can cause certain difficulties.

It is also necessary to take into account that in the process of doing business certain risks may arise:

decreased demand for products and services in winter;
changes in legislation that will complicate the work of the enterprise;
increased competition as a result of the emergence of new competitors.

Summary of the future project of a lumber procurement enterprise

The main goal of the project for which a business plan for opening a sawmill with calculations is being written is the creation of an organization for the production of lumber. Lumber is one of the most widely used building materials today. It is used not only for construction itself, but also for exterior and interior decoration of buildings. Prerequisites for starting such a business may include:

shortage of available building materials;
increased interest of private investors in construction;
development of housing infrastructure;
low level of competition.

The technological algorithm includes the supply of material for harvesting and scaffolding, its sawing and planing, and then marketing. The material can be sold both wholesale and retail.

Registration of the case

Setting up a sawmill from scratch requires mandatory registration. So, you can open an individual entrepreneur - this is the best way for a beginner in business. It is also important to obtain a full package of clearances for work. They are issued by the local government and the fire department. Of course, the enterprise must fully comply with legal requirements and be located in an area where such activities are permitted.

In connection with recent changes in rules and laws, some beginners are interested in whether sawmills need to register with EGAIS. Since the beginning of last year, all entrepreneurs are required to declare such transactions. So, here you will also need to create an account and regularly send reports to the organization electronically. As a rule, the basis for your registration will be a lease agreement for industrial space. In addition, when you plan to carry out additional logging, you will need approval from the Forestry Department. Typically, about 78,000 rubles should be budgeted for collecting documentation - after all, it is advisable to entrust this step to an experienced lawyer. As a rule, he will be able to properly formalize your undertaking.

Range of products offered

Among the products that the sawmill can offer are the following options:

edged and unedged boards;
beam;
bar;
rounded log.

Typically, lumber is made from softwood logs using specialized equipment. Finished products must meet GOST requirements. This will show the products in terms of high quality and low rejection rate.

The scope of use of sawmill products, as already indicated, is quite large. The material can be used for exterior decoration, for roofing, for sheathing, for interior decoration, and for the construction of buildings.

Employees and workers

The staff of modern sawmills is:

The director can be the individual entrepreneur himself or the founder of the LLC.
Accountant.
Sales and Customer Relations Manager.
Sales representative to find new clients and present products.
Sawmill foreman.
Machine operators.
Framers.
Storekeeper.
Locksmiths.
Drivers of trucks and forklifts.
Cleaners and security guards.
General workers.

To properly operate a sawmill, you need to hire about 15 workers. In the future, as the business expands, new specialists will be needed.

Sales and Marketing

Due to the fact that the products produced by the sawmill fully comply with state standards, in addition, they have rather weakly expressed differences in features and characteristics, the main competitive advantages of the company will be the cost of goods, as well as the stability and regularity of supplies. This has already been discussed above. It will be necessary to ensure not only technologically advanced and fast production, but also reliable logistics.

Therefore, developing a flexible pricing policy for the enterprise will be a good competitive advantage. A larger number of lumber manufacturing companies ship products under prepayment conditions or upon receipt of goods. You can offer your clients more flexible terms: installment payments, loans. This will be your significant advantage in the difficult economic situation in Russia.

The company's main advertising activities and marketing activities will be aimed at wholesale distribution channels:

creation of a company website;
registration in catalogs and construction portals;
advertising on thematic platforms;
active sales will become the main advertising tool. As part of cold calling, the sales representative advises representatives of other companies on cooperation with you and concludes contracts.

During the first few months, the company should acquire several regular customers. They should account for about 50% of sales.

Sawmill: services and sales market

A home sawmill does not necessarily have to work with large timber suppliers. For some areas where private construction is not in great demand, the manufacture of timber, finishing and construction boards is not the most profitable investment. In cities the following are more in demand :

timber with sides 60, 50, 40 mm;
slats with a section of 25 by 35, 40, 50, 60 mm;
platbands and other elements of the door frame;
glazing beads and window frames;
wooden doors;
window frames.

As a point of sale for these materials, you can use construction chain stores such as Metrica, Vimos, where they ask for slats and other lumber. Agreements for constant supplies of building materials will be mutually beneficial. Locally produced goods are cheaper due to direct deliveries and reduced transportation costs.

It is not always profitable to manufacture window frames and door panels for sale. In private construction, the size of window and door openings often differs from the standard sizes adopted for standard buildings. Windows and doors differ in height and width in city houses of Stalinist buildings. It is better to make replacements for old frames and door jambs to order, which requires good advertising on social networks and stores selling similar goods.

For the manufacture of slats, beams, door leaves, and window frames, wood of standard humidity, converted into a garage workshop, a retractable metal bed with a fixed circular saw, and a carpentry machine are sufficient. This simple equipment is enough to generate an initial income, which will gradually allow you to purchase your own drying chamber, milling cutter and other necessary machines. This is how a simple sawmill can grow into a woodworking shop.

Sawmill as a supplier of raw materials for production

Before opening a sawmill, it is necessary to “test” the sales market, study the demand for the services of potential partners who need wood raw materials for manufacturing products. You can look for lumber customers in neighboring areas. If you have regular customers with stable production of furniture, pallets, pallets, flooring, boxes for storing agricultural products, you can plan your own income from cooperation.

The guarantor of the fulfillment of agreements is a drawn up, partially or fully paid, contract for the supply of raw materials of a certain type, humidity, category. Taking into account the dimensions of the boards used by the customer, it is possible to simplify the loading, dispatch, and delivery of material.

To do this, you simply need to cut the boards to size, which requires trimming equipment. The peculiarity of pine is that its crown is high, which means that most of the trunk is suitable for making materials of category A. But the upper part can also be used for material of the same quality by cutting out knotty areas. It will take more time to process, but the material will be of higher quality, which is beneficial for both the supplier and the customer.

Organizational and legal aspects of business

The first thing you need to do when opening your own sawmill is to fill out all the necessary paperwork. First of all, you need to register your company with government authorities. For this you will have two options.

Individual entrepreneur. Using this form of ownership, you will be able to sell products only to individuals.
OOO. Using the presented form of ownership, you will be able to cooperate with both individuals and legal entities. The advantages of this form of ownership are that it can even cooperate with foreign counterparties.

When registering, you must indicate the appropriate code according to the OKVED classifier. This is 20.1. Sawing and planing wood.

Before you start working, you will need to obtain permission to cut down forest in the selected location and rent a plot. A permit will only be required if you intend to extract raw materials yourself. If you want to organize the purchase of raw materials from suppliers, permission is not required. After you have registered with government authorities, you will need to register with various funds, in particular the Pension Fund. Additionally, you may need the following types of documents:

a plot lease agreement or a certificate of plot ownership. If a lease agreement is used, it must be supported by a logging permit from the owner;
coordination of actions with local forestry;
plant inspection report;
detailed plan for the use of the site;
if you are going to purchase raw materials, immediately enter into a long-term supply agreement, where all the conditions will be specified.

When opening an LLC, you will need to open a current account in a reliable bank. Remember that a constant and uninterrupted supply of raw materials is your guarantee that the organization will not be idle, and your profits will be just as stable and regular.

What is needed to start a sawmill business?

Before planning to open a sawmill in a particular area, you need to contact the local administration to find out if they plan to introduce restrictions on deforestation. The introduction of such bans in the future could undermine the stable operation of the sawmill as a business.

After this, you need to draw up a business plan for the sawmill. It is important to calculate:

Reserves of timber permitted for development.
Determine the sales markets and their capacity.
Calculate the maximum number of potential buyers.
Calculate the cost of purchasing or renting premises.
Clarify the list of equipment necessary for the operation of a sawmill.
Calculate the number of personnel and the amount of costs for their salaries.
Determine the costs of transporting raw materials and products.

When drawing up a business plan, it is important to evaluate competitors’ offers and understand how to beat them. Advantages may include favorable prices, higher quality, and the possibility of large wholesale deliveries of products.

Investments in a sawmill as a business will amount to about 2-2.5 million rubles. They can be repaid in a year, provided that a circle of regular customers is quickly formed.

Sawmill production business plan

At the initial stage of operation of the sawmill, you will need to select suppliers of raw materials. Deliveries must be carried out regularly, in volumes that will be determined by needs. Production volumes should be adjusted based on the demand forecast for the week ahead. This will make it possible to produce products of the volume that will definitely be purchased, and which will not lie in the workshops. It is advisable that the warehouse turnover be planned at the level of one week. The supplier of raw materials is selected based on:

equipment quality;
supplier service quality;
timing and regularity of equipment delivery;
flexibility of pricing policy and payment options.

Sawmill as a business

Any business needs to be opened after a thorough analysis of the market, studying the details and subtleties. A new entrepreneur should start planning with a budget sawmill. This will save initial capital and quickly eliminate errors that may occur in the first years of operation.

We have some more interesting business ideas for the village:

Production of bath brooms;
Yarn manufacturing business;
Production of fireweed tea.

Production location

According to the standards, a wood processing plant must be located at least 100 meters from a residential area, since production is accompanied by a lot of noise. The ideal place to build a sawmill would be a forest on the outskirts of the city. Some machines require water to operate, so communications must be in close proximity. A small production can be located on a plot of about 1000 sq. m.

Note! The minimum power of a sawmill starts from 50 kW, so a three-phase 400 kW line must be connected to the building, which will ensure uninterrupted operation of the machines and equipment.

To establish a lumber business, production space will be required. They are necessary for storing:

Finished products;
Raw materials;
Sold material before shipment.

Equipment and personnel

The main expense item when opening a sawmill is the purchase of machines for wood processing and board production. To operate a small sawmill with a capacity of 1000 cubic meters you need to buy:

“Circular saw” machine – from 900,000 rubles;
“Multi-saw” machine – from 150,000 rubles;
“Band sawmill” - from 130,000 rubles.

Expert opinion

Alexey Matveev

Expert of our site. An experienced specialist in various fields of agriculture, as well as organizing business processes.

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To reduce the cost of purchasing equipment, you can consider purchasing used machines.

The success of a business depends on the employees who will service the sawmill. It is recommended to hire qualified personnel:

Sharpener;
Framer;
Enterprise manager.

It will be necessary to hire low-profile employees who will do menial work. For a small sawmill, 10-15 people are enough.

Manufactured products and sales of goods

The main advantage of a sawmill as a business is waste-free production. The company produces:

All types of boards;
Beam;
Fuel briquettes.

Cable reels are made from leftover material.

Distribution channels must be planned at the initial stage of opening a business. As a rule, the main customers of the products are construction companies. In addition, the product may be of interest to:

Furniture factories;
Manufacturers of wooden windows and doors;
Large stores selling building materials.

Another profitable business idea is the production of self-tapping screws, we recommend it.

Competition in the market is high, so a private sawmill must actively advertise its products. The company needs to create a presentation website, organize sales points, and place information about the product in printed publications.

Note! Winter is the best time of year to open a sawmill. During this period, demand for products falls, which makes it possible to set up equipment, prepare and train personnel.

Choosing a location for a sawmill

In order to open your own sawmill, you will need a plot of land with an area of at least 30 acres. If you are going to extract raw materials yourself, there should be a leased area for deforestation near this site. This will help to significantly reduce costs of raw materials and logistics. In any case, make sure that the sites have high-quality access roads for logging vehicles to enter.

It will be necessary to install several buildings:

production workshops;
warehouse for finished products;
area for loading and unloading operations;
office space where negotiations with contractors will be conducted and documentation is stored;
employee rest room equipped with a kitchen, shower and toilet.

Production and warehouse premises must have a ceiling height of at least 5 meters. The area of each of them should be about 600 square meters. Each of the premises used must be equipped in full accordance with the requirements of the fire inspection. Fire extinguishing agents must be present. Make sure you have a reliable and high-quality electrical network that can withstand heavy loads. The power of some units is up to 50 kW.

Important: you should not open a sawmill on your own summer cottage. Regardless of what form of ownership you choose, the land must be alienated to fund industrial work. If you simply own the land, you will not be able to conduct business legally.

Selecting a room

The production cycle completely determines the characteristics of the premises: you will need a plot of at least 30 acres. Roughly divide it into three parts: for raw materials, for finished materials and for the sawmill itself. You will also need an office for administrative staff, a break room for workers with a shower and restroom.

In addition, there must be enough space for cargo transport. Give preference to places within close or transport accessibility of the forest where work will be carried out. Harvesting lumber is a seasonal process, but it’s worth considering a canopy for the sawmill in case of unforeseen weather conditions.

The cost of renting a plot with premises is 80,000 rubles.

Equipment purchase

The list of units used will depend on what type of sawmill you are going to open, what range of tasks to perform, and what kind of products you are going to produce. So, if you are going to extract raw materials yourself, the amount of necessary equipment will increase. The number of units will also increase if you plan to process waste from production for further sale. The following types of equipment may be involved:

disc machine or belt machine with manual or hydraulic feed system. You can give preference to the first or second type when you decide what type of sawmill you will have - belt or disk. To select the necessary equipment, study the advantages and disadvantages, as well as the features of the products;
mini machines and frame machines:
edge trimming machines;
multi-saw units;
saw sharpening equipment;
drying chamber;
equipment for creating briquettes from sawmill waste;
hand saws, also chainsaws;
equipment for loading and unloading.

How to open a sawmill from scratch. Is it profitable to start?

The demand for various lumber has remained very high for many years. So, this is due to the fact that the private sector construction market is constantly developing: country houses, dachas and additional buildings: bathhouses, gazebos and others. The roofs of all these structures, and sometimes the walls, are built from treated wood. Many entrepreneurs who like working with wood try to enter this niche and take their “place in the sun”; some succeed, some don’t. Let's take a closer look at how to open a sawmill from scratch, what you will need to buy and where to look for customers for finished products.

Pros of this business:

high demand for processed wood
the opportunity to start with small investments and subsequently expand the business
high profitability
trading usually occurs in large volumes

Of the minuses:

difficulty in finding reliable round timber suppliers
high electricity consumption when operating units
presence of seasonality

We have given the main pros and cons, now let's understand the main steps to launch a business idea at a sawmill.

Documentation

In order to work in a legal environment, you, as an entrepreneur, will need to obtain all permits for the production line and for trade.

Here's what you'll need:

open IP.
recruit staff.
sign contracts with suppliers of raw materials, or have permission to process the plot on your own.
have in hand a lease agreement for industrial premises.
obtain a work permit from the SES and fire service.

Location and premises

To set up the production process, you need to rent a room, preferably on the outskirts of the city, so you can save money. The main requirements include:

— the rented area must have several main premises: work area, warehouse, drying. Usually they look for hangars or large garages with an area of 100 sq.m. or more. and a ceiling height of 4 m. This ceiling height is needed for the entry and operation of equipment, such as a loader.

— a powerful power line of 50 kW or more must be connected to the premises. This is necessary for the operation of very powerful equipment that you will use every day, so there must be a power reserve. If a weak power line is connected to the work site, then it makes sense to look for alternative options, since a connection from scratch can cost up to $10,000, and this is already a very serious investment, especially at the start.

- good entrance. This is also one of the important factors when choosing a workplace for a small business at a sawmill. Large trucks will be driving towards you, so they need a place to turn around or just park the car.

— measures must be taken to organize fire safety. This is, first of all, equipping workplaces with fire protection equipment and moving smoking areas outside the production area.

Do you live in a village and don’t know where to start your own business? We have made a selection of various business options in the village. Various options for starting are considered, both without money and with starting capital. Be sure to take a look and you will probably find something useful for yourself.

Sawmill equipment

The quality of products produced for sale will depend on the choice of equipment. If you save on this point, you may not only not earn money, but also waste all the purchased raw materials. Therefore, you need to approach this issue as responsibly as possible.

Here's what you'll need to open the sawmill:

The main tool for your business will be the band sawmill. It is inexpensive, practical and easy to maintain. Its cost is about $1700 - $2300. You need to take a machine for cutting round timber with a diameter of up to 1 m. Look for a device option that provides minimal waste from round timber, allowing you to get maximum profit.
multi-saw Using this tool, wooden slats, bars, etc. are produced. There are two types of these devices: frame and disk. Frame ones are more productive and convenient, but at the same time more expensive, so their cost is from $12,000 to $22,000. The price for circular saws ranges from $8,000 to $
edge trimming machine. With it, you can make wooden lining, which is used as a finishing material, both in the interior and for the facades of buildings. Its cost is about $
equipment for drying finished products.
equipment for loading and unloading.
saw sharpening machine – price from $500

It is clear that if you have just begun to consider a sawmill as a business, then for starters you can include only a band sawmill in your business plan, and subsequently purchase other types of equipment.

During a crisis, you can buy used machines in excellent condition.

Advice: experienced businessmen who run this kind of business advise buying imported machines, since there will be fewer problems with them in the future.

Raw materials

You can choose two options for purchasing raw materials:

Find wood suppliers and collaborate with them regularly.
Buy forest areas for felling. At the same time, you must have all permits in hand.

Another current area of activity is services for insulation of external walls of houses. This is especially true at this time, when there is a crisis and people are worried about how to survive the heating season. All the moments of this business are here -.

How much money do you need to start?

Let's try to do some economic calculations to understand how much it costs to open a small sawmill.

List of main costs:

premises rental – $1000/month.
utility bills – $800/month.
taxes – $200/month.
salary – from $2000/month.
transportation costs – $150/month.
sharpening and purchase of saws – $100/month.
purchase of consumables – $300/month.
initial purchase of raw materials – $6500
purchase of equipment – from $8,500 at the start and higher in the future.

If we take the percentage ratio, then the products ready for sale are 50% - 60% of the base volume of raw materials. The capacity of a small sawmill is about 100 cubic meters. processed material per month.

Raw materials are purchased on average for $30 - $35 per 1 cubic meter, and sold for $90 - $95. Thus, monthly revenue will be about $9,000 - $9,500. Minus monthly expenses ($6500), we get a profit of about $2500 - $3500.

The payback period for the business will be about 1 year. As you can see, the profitability is very good, which is why many entrepreneurs go into this line of business.

Conclusions. It is profitable to start only if there is no huge competition in your region, and you can develop permanent connections with suppliers of raw materials and you have in mind a suitable premises for opening a sawmill. This is a specific business that requires constant control over the work process and technical knowledge to maintain all equipment.

Do you have experience in this business area? We look forward to your feedback below.

Recruitment of personnel for the sawmill

In order to launch your own sawmill, you will need to form a staff of 10 to 15 people, which will include:

foreman or work supervisor;
office staff: sales representative, sales manager, secretary for receiving calls;
accountant. In many types of businesses, an accountant-auditor can be used, but here this option will not be a very good solution. You will constantly work with large cash flows, with a large number of contractors and personnel;
warehouse employees;
employees for the direct operation of sawmills, framers, repairmen;
security guards;
cleaners.

For those employees who will work directly with the production of materials, it is recommended to establish piecework wages. Cash will be calculated per 1 cubic meter of products received. Other employees can work on a salary basis. Depending on the expected scale of the activity, as well as the distance from the populated area, you may need to hire a driver to transport and deliver personnel.

Staff

Regardless of the size of your business, you will need to hire employees for the following positions:

Head of the sawmill. There is no position on the website hh.ru for a sawmill manager, but the salary of a production shop manager varies from 30,000 to 70,000 rubles
Woodworking masters. By analogy with the previous point: production shop foremen receive from 18,000 to 35,000 rubles
Repairman. Approximate salary range: 18,000-42,000 rubles
Security guard. Estimated salary from 23,000 rubles
Cleaner. Estimated salary up to 16,000 rubles
Driver. Approximate salary range from 19,000 to 55,000 rubles

In manufacturing enterprises, the piecework method of remuneration is common. This way, employees understand that their salary depends on their productivity and try to do better.

In total, you will have to contribute at least 124,000 rubles to the wage fund

Product sales market

The search for distribution channels should begin at the stage of opening a business. Don't wait until the warehouse is filled with finished products. It would be better to work on a pre-order basis, understanding how much work needs to be done. Enter into agreements with the following partners:

hypermarkets;
construction stores;
construction companies that build cottages, private houses, baths;
factories that work with wood.

In addition to legal entities, you can cooperate with individuals. Very often, such building materials are required by summer residents and farmers who independently build various buildings on the site.

Reviews

“Two years ago I opened a sawmill and am now pleased with the investment. Difficulties arose only at the first stage, since we had to look for equipment, premises, and workers. Initially, I bought a minimum number of machines and hired several people. Over time, they expanded and now the profit per month is at least 1,300,000 rubles” - Andrey.

“Several years ago I opened my own sawmill and did not regret it. This business brings constant income. I would like to immediately warn novice entrepreneurs that they should not open a sawmill at home. This will lead to problems with documents. It is better to rent a hangar somewhere separately. I bought used equipment, which allowed me to save a considerable amount of money. There is always a demand for lumber, and especially in the summer” - Vyacheslav.

“I have my own sawmill from which I earn money. It's a risky business, of course, but you can try. Since you have to work with wood and powerful equipment, you need to take care of safety. We had a fire incident, but everyone quickly fixed the problem. I would recommend installing smoke alarms. It is better to immediately choose a larger place for the sawmill. To increase the number of clients, we use advertising and the Internet” - Gregory.

Company financial plan and performance assessment

The amount of investment you will need will directly depend on the expected volume of work, the type of sawmill. To calculate your initial investment, include the following items:

costs for registering a company from 10 thousand rubles;
rental costs from 120 thousand rubles.
purchase of necessary equipment from one and a half million rubles;
construction of buildings from 300 thousand rubles;
advertising and marketing costs from 150 thousand rubles.

On average, you will need 2 million 80 thousand rubles at the initial stage.

Fixed costs must also be taken into account. They will consist of rent, utility bills, advertising, and equipment depreciation. On average they will amount to 250-300 thousand rubles. Some types of costs will be seasonal, so the amount of costs will vary at different times.

On average, the net profit of a sawmill will vary from 150 to 300 thousand rubles - everything will depend on the volume of work. This business demonstrates high profitability of up to 27-30%. The payback period can be achieved very quickly, within the first six months of operation.

Financial plan

It is important to calculate the pros and cons of opening a sawmill. To do this, you will need a business plan for a sawmill and all the calculations. Here are examples of costs for starting a business to produce 700 cubic meters per month:

Expenses	Amount, rubles
1.	LLC registration	50 000
2.	Purchase of equipment	2 800 000
3.	Raw materials	1 300 000
4.	Workflow organization	200 000
5.	Renting premises and land	100 000
6.	Employee salaries	180 000
7.	Public utilities	25 000
8.	Taxes	60 000
9.	Other waste	20 000
Total:	3 185 000

The profitability of 1 cubic meter of wood in our country is approximately 1,500 rubles, and the cost of finished products is 5,000 rubles. The average cost of 1 cubic meter of wood obtained is 3,290 rubles. Income from 1 cubic meter can be 1,710 rubles.

If you process up to 700 cubic meters per month, you can get 1,197,000 rubles. The investment pays off within 8 months. Many sawmill owners receive additional income from waste by making fences, bars, reels, and pallets. Sawdust is used to create pallets.

Some sawmill owners offer workers a fixed payment: they receive money based on the number of cubes cut. This allows you to save on waste. The sales markets are shops, furniture manufacturing factories, and construction companies. Often such a product is needed by summer residents or farmers.

So the idea of opening a sawmill can become profitable. It is necessary to study the presented example of starting a business and draw certain conclusions. The sawmill will flourish as there is demand for the construction of country houses.

Video: sawmill, the principle of its operation.

Possible risks

The advantage of any manufacturing business is that the risks are quite low. Sawmill products are always relevant and popular in the market, and there is a high demand for them. This allows us to talk about good prospects for the project. Among the risks are the following:

interruptions in equipment operation;
interruptions in the supply of raw materials, increased prices from suppliers;
increasing the level of competition;
deterioration of the economic situation in the region;
low sales volumes.

To reduce the likelihood of these risks occurring, carefully select your partners to work with, as well as your company’s employees.

Advantages and features of sawmills for primary wood processing

Any enterprise operating in the woodworking industry will benefit from purchasing or upgrading sawmill equipment, as well as from equipping existing sawmill equipment with mechanization:

the resulting products will be competitive in both the domestic and foreign markets;
will be able to cope with orders of any volume in a timely manner;
the number of defects will be reduced to zero;
product quality will meet the requirements of export GOSTs;
equipment productivity will increase;
the influence of the human factor will be reduced to a minimum.

Purchasing modern equipment for a sawmill is a promising investment that is guaranteed to be justified by numerous advantages and will allow the owner company to easily increase sales volumes.

Efficiency mark

To assess the investment attractiveness of a project, generally accepted integral indicators are used - net present value, profitability index, internal rate of return, etc. Integral indicators are given in Table. 1.

The discount rate was chosen at 15%, which is typical for organizing new production of non-innovative products; a market for the products already exists. With such a discount rate, all integral indicators have very high values, which allows us to talk about the high investment attractiveness of the project. The payback period is 6 months, and the net profit after the enterprise reaches its planned targets will be 15.65 million rubles. in year.

Description of the industry and company

To date, open sources contain information about only one lumber manufacturer throughout the republic, located in the city of Dzhankoy. 97% of lumber comes to Crimea in finished form from suppliers on the mainland. Moreover, their cost is on average 55-65% higher than the cost of similar materials in other regions of the Russian Federation.

At the same time, the pace of construction is increasing. According to the government development program of the republic, the territory of Simferopol should be expanded 7 times. In addition, the volume of construction and reconstruction of tourism infrastructure is increasing. The organization of a free economic zone (FEZ Crimea) makes the region attractive to investors from other regions.

At the same time, from 50 to 70 building materials bases are present and successfully operate in the region, selling edged and unedged lumber wholesale and retail. Supplies to them are carried out from the regions of the mainland of the Russian Federation. All these organizations are potential consumers of the products produced by the project. The total consumption of lumber in the republic and the city of Sevastopol is estimated at 12-15 thousand cubic meters per month.

The most popular type of product is edged boards, which have a wide range of applications. Then - timber, planed board, block house, imitation timber, etc. Edged boards account for at least 65% of the total market volume or 8.5 thousand cubic meters. In the coming years, demand is expected to grow steadily within 5-10% annually.

Much attention is paid to the choice of supplier. The selection was made according to a number of parameters: quality and price of the material, convenience and cost of logistics, stability of supply of the required volumes. The production is supposed to be located no further than 5 km from the Simferopol - Gruzovoy station, which from the point of view of organizing logistics will be as convenient as possible, because transportation of raw materials is expected to be carried out by rail.

The production facility is selected primarily from the point of view of the possibility of implementing the technological cycle, manipulating workpieces and finished material 6 m long, etc. Loading equipment is rented. Considering the seasonal nature of demand for the products in question, this is a more cost-effective option than purchasing property.

The main sales channel is wholesale supplies of lumber to building materials depots located on the peninsula. Minimum order quantity – 30 cubic meters. Delivery is organized by Pili-Pila LLC with the involvement of a transport company or private carriers. In addition, it is possible to sell goods at retail, subject to pickup.

Investment costs include, first of all, the purchase of technological equipment and the cost of forming an initial supply of raw materials. The list and volumes of investment costs are given in Table. 2.

Table 2. Investment costs of the Pili-Pila project

Name	Amount, rub.
Warehouse and office equipment	100 000
Equipment set	3 500 000
Purchasing software	70 000
Working capital	1 500 000
Purchase of raw materials	2 000 000
Total:	7 170 000
Own funds:	2 000 000
Required borrowings:	5 170 000
Bid:	18 %
Duration, months:	48

Organizational plan

When implementing a project, the following main stages can be distinguished: ordering and supplying equipment, installation and configuration of equipment and training of workers, the first stage of project implementation, the second stage of project implementation.

Order and delivery of equipment – 14 calendar days. Installation, commissioning and training – 10 working (14 calendar) days. The first stage of project implementation is understood as the period preceding the achievement of planned sales figures. The second stage of implementation is the direct activity of the enterprise in accordance with established targets. It is planned to enter the second stage by the 6th month of work.

Management functions are carried out by the director - a hired employee with experience in the woodworking industry or in the lumber trade. It is critical to have experience as a director (deputy director) of an enterprise.

The work of attracting clients is carried out by sales representatives. The main work occurs in the off-season to prepare the soil for the season. Customer service is provided by sales specialists who process incoming orders, issue invoices and control payments, and organize shipments.

All employees are carefully screened before a hiring decision is made. As a result, recruitment occurs for the purpose of long-term cooperation, rather than seasonal work. Employees retain their salary even in the off-season, when there is actually no production work or sales of goods.

Table 6. Staffing and wages fund

Job title	Salary, rub.	Number, persons	Payroll, rub.
Accountant	25 000	1	25 000
Director	50 000	1	50 000
Brigadier	30 000	1	30 000
Sawmill operator	25 000	2	50 000
Sales Manager	22 000	2	44 000
Sales Representative	30 000	2	60 000
Storekeeper	27 000	1	27 000
Loader	20 000	2	40 000
Total:			326 000
Social Security contributions:			97 800
Total with deductions:			423 800

Figure 1. Organizational chart of Pili-Pila LLC