Do you plan on setting up or buying a timber company soon?
Often, running a business in the construction industry is trickier than expected. Even as a timber merchant, you’ll encounter specific challenges.
In the guide below, we’ll discuss what it takes and what you need to become a timber merchant. Read on and learn some helpful tips to make your business profitable:
1. Research the Timber Market
The first step to establishing any business is to research the market. Even if you’re buying an already-established business, do your homework. Find out everything you need to know about the business.
If you’re starting as a small-business timber supplier, find out how much local builders need. For example, the average house needs 6.3 board feet for each square foot. It gives you a good idea of the amount of timber to have in stock for local clients.
Know your clients and competition. Who are the most likely to buy timber from your business? What services will they expect?
Once you determine these, find out ways to be competitive with your price range and knowledge.
2. Get the Necessary Permits and Licenses
Before going further, get all the necessary licenses and consents. It goes beyond getting a business permit. It extends to all other related services a typical timber supplier uses.
An example is a vehicle for transporting goods. Most likely, that vehicle has a gross plated weight of 3.5 tons or more. Get the necessary permits to operate such vehicles.
Consider all operations in the business potentially warranting a permit or license. The same applies to other aspects of running a timber merchant business. Remember, certain states and municipalities have varying requirements for businesses.
3. Plan Your Timber Merchant Business
Figure out where to get the timber for your inventory. Your business shouldn’t also only rely on serving customers. Establish a reputation and reason for customers to choose your business.
Speaking of customers, know your primary target market. The customers you attract will depend on the nature of your business. Some people likely to seek out your building supplies and goods include the following:
- Landscape gardeners
- Painters and decorators
- Other specialist tradespeople
- Other businesses (like caravan parks)
Be particular when picking the goods that you want to sell. Even as a timber merchant, you can go beyond and sell products other than timber. You can also stock clothing items, garden accessories, furniture, decorating goods, and more.
Proper planning is the key to a successful and lasting business. Around 20% of small businesses in the United States fail after the first year. After five years, 50% remain, and after five more only 30% are still open.
As a timber merchant, business failure after a few years leads to many negatives. You won’t only lose all the money you invested, but it can also affect other aspects of your life. To avoid this, make sure your business plan is flexible enough to adapt to sudden changes.
4. Safeguard Your Timber Business With Insurance
Next, think about everything that can go wrong with the business or its operations. Find an insurer for every possible business component. It includes your equipment, employees, and other factors you might consider.
As much as possible, provide insurance coverage for the following:
- Employer’s liability
- Product liability
- Premises, premises contents, and stock
- Public liability
- Business interruption
- Motor fleet insurance
- Goods when in transit
For example, your business uses portable sawmills for low-impact logging and faster operations. Make sure that the equipment has insurance for portable sawmills. The same should apply to your other equipment, gear, laborers, and other assets.
5. Promote the Business
Once you planned and established your timber merchant business, the next step is to promote it. Attract target customers to the company through print advertising and digital marketing. Your target market likely focuses on the locals, so give more attention to the local promotions.
Get the word out and advertise in local newspapers and local directories. If there are local events, consider sponsoring them. It will also help if you print leaflets and send them to local builders, roofers, plumbers, and others.
We’re in the internet era, so don’t forget about digital advertising as well. Launch a website for your brand and showcase your goods and services there. You can also attract more website visitors through valuable and informative content like blog posts, videos, and more.
Consider looking at the advertising strategies of your competitors. Which of their marketing efforts are most effective and which ones don’t work well? Don’t be afraid to get ideas from their advertising campaigns and improve upon them.
6. Tips for People Who Want to Become a Timber Merchant
Be careful about the products you decide to sell. For example, you plan on including plywood in your catalog. There are a lot of plywood types and qualities you can pick from.
Give your clients the chance to pick the type and quality of plywood. Train your employees to be more knowledgeable about plywood. This way, they can be more effective and helpful to customers who have no idea what plywood they need for their home improvement project.
Consider Buying an Existing Business
Are you hesitant about starting a timber business from scratch? If you don’t think you can build a timber merchant business from the ground up, buy an established business. You still have to get the basics of running a timber merchant business down, however.
Build a Strong Timber Business
These are the requirements of running a timber merchant business. We hope you enjoyed and learned a lot from this guide. Don’t let the changing economy stop you from becoming profitable.
However, it’s best to learn more about business management.
Are you looking to broaden your knowledge? If so, check out our other guides, news, and posts today!