My 2014 Firewood Season At A Glance

[luckydozenfarm]

This is for all you math nerds and accounting wizards like myself:

It is my 18th year of selling firewood commercially and we had a bigger year than usual. By pure stupid luck I ran into a developer that was wanting over 100 acres of oak trees cut down for free to begin development of a subdivision not more than 20 miles from my woodlot. I would guess this property had around 10-20 good sized oaks per acre. Why he wanted them all cut down I don't know but I'm guessing that it has to do with the majority of the property is pretty low lying. Maybe he needs to grade the area, but I didn't ask.

I purchased a 30' deck-over flat bed trailer, two new Stihl 660's and a TW-6 to handle this venture. I got in on this deal kinda late in the year (May 15th). So my guys and I have been cutting our butts off to get this wood at least back to the woodlot so we don't lose it to his bulldozers. To make a long story short we just sold our 200th cord last weekend. So I figured I'd run the numbers and present them here for anyone who wanted to see how we did.
BTW I do firewood as a side job...I'm a CPA-certified accountant during the day so running these numbers was fun for me..I know..I know... I'm weird. Keep in mind these are the exact numbers we had after the 200th cord went through. It includes the Income Statement from the entire year right down to the last dollar.

Income Statement 2014​

Revenue
Firewood Sales (Cust Pickup) 95 cords @ $275 $26,125
Firewood Sales (Delivery) 105 cords @ $300 $31,500
Firewood Sales (Chunks and Stove) $ 1,235

Total Sales $58,860

Expenses
Truck and Tractor Diesel $8,540
Chainsaw Fuel $ 640
Labor $6,540
Splitter Fuel $1,450
Chainsaw Maint. (chains, bars, oil, files, etc) $ 825
Tolls $ 210
Misc Repairs $ 430
Misc Small Equip Items $ 358

Total Expenses $18,993

Net Profit $39,867

So that's not bad at all I'd say. I netted about $200 in operationg profit per cord. I purposely didn't figure in depreciation numbers into the statement, because that's a complicated figure that I didn't have time to go over yet. This is pretty much a good indication of what kind of money you will make at 200 cords in our area (Houston, TX), A keen eye will notice I didn't have a dime spent in advertising. Craigslist is the absolute bomb!! Thanks guys...

 

[blackdogon57]

Nice profit on 200 cords. I did a similar deal last year. The tress were already dropped. They just needed to be bucked to size and placed in an area where a picker truck could grab them. I contracted a trucker to move the wood as it was a one time deal for me. I usually get logs delivered. Cost me around $ 30 per cord to move logs to my yard.

 

[firebrick43]

I could imagine running 640 dollars of fuel in a chainsaw in one year!

Sounds like 200 cords is just what you have sold so far and there is more in the yard?

Sort of suprised fuel cost were higher than labor, but then again you didn't pay yourself yet.

 

[nathon918]

taxes?

 

[lone wolf]

taxes?

 

[nathon918]

I like taxes as much as the next guy, but that's a lot of sales if its under the table...

 

[svk]

I doubt he'd be posting on here if he was planning on pocketing all that cash....

Nice haul for 7 months of work.

 

[luckydozenfarm]

Yes I pay taxes on it. I have a lot of equipment and land under farm exemption status so in order to keep that I have to show something. Gotta love the IRS Form Schedule F right?
My guys weren't always with me when I was cutting so the labor expense isn't very high. And no that doesn't account for my labor.
I was surprised too at the chainsaw fuel. But there were a few times I had 4-5 saws running all day long. A 660 and an 880 can go through some fuel. I expect the splitter fuel to be higher next year because the TW6 uses more fuel per cord than my 2 Speecos and I didn't get that splitter until late July.
I have a ton more to go that's already in the lot ready to be processed. But most of that will be going towards next years wood. This is the first year that I wont be completely sold out by Christmas.

 

[deadtrees]

So you sold all this as green wood??

 

[Steve NW WI]

Saws can be expensed - they're just tools. Sec 179 the TW and trailer (depending on the final rules - in congress right now), as you won't always have free product and the tax savings will likely do more good this year.

I also see no insurance expense - pretty risky with hired help. One injury wipes out that year's profit, maybe the entire business and all your personal assets.

 

[blackdogon57]

Workers comp/insurance is considered a labour cost. Not sure how you guys do it down threre.

 

[jrider]

I'm a little surprised your fuel bill was so high. What are you using to move logs back to the farm and to deliver? What is your average delivery size/distance? I only do around 100 full cords but my fuel is much much less.

 

[kyle1!]

I'm a little surprised your fuel bill was so high.

He is moving logs with that JD avatar I assume and those don't sip fuel.

 

[luckydozenfarm]

I have a Dodge 4500 and a 2500. Plus three tractors we use. Diesel is our number 1 expense. Our avg round trip delivery is about 50-60 miles hauling 5 cords at a time or less.

 

[luckydozenfarm]

Our woodlot is on our farm. We have special workers comp umbrella policy at the farm bc we do a bunch of different things here.

 

[luckydozenfarm]

Actually the Deere in the avatar is only 75hp..I go through maybe only 20 gallons a week for that thing. It is used for other purposes so it's a little difficult to break it out. It's more of an estimation on the tractors for fuel.

 

[luckydozenfarm]

So you sold all this as green wood??

You should see how fast wood dries out after 5 months of 95+ degree heat and sun. we did go through and cut all the dead trees first just so we would have something that was really dry to sell first.

 

[Thornton]

Nice job post some pics

 

[Landmark]

Nice. I love stories like this.

 

[Guswhit]