Thinking about opening a lumber brokers business? We tell you what you need to know to get started.
Lumber Brokerage Basics
Lumber brokers serve as the middlemen between lumber mills and lumber buyers. They are usually experts in the lumber industry who are well connected and possess a firm grasp of both lumber products and the marketplace in general.
Although some brokers do business with independent lumberyards, many specialize in providing lumber and building materials for large building projects and major contractors. As a result, best-in-breed brokerage firms are expected to provide guaranteed forward pricing, computerized inventory management, just-in-time delivery and other first-tier business strategies.
Lumber Grading & Brokerage Startups
Lumber brokers live and die by their ability to buy low and sell high. The problem is that lumber isn't a uniform commodity -- if you're not careful, you can spend good money on lumber products that are worth much less than you anticipated.
When you choose a core team of professionals for your brokerage firm, it's important to include lumber grading in the mix of skills you need on your team. Having a trained, in-house lumber grader means that you won't have to rely on someone else for valuation, enabling you to perform more accurate pricing on both ends of your transactions.
Resources for Lumber Brokers
Maverick entrepreneurs don't last long in today's lumber industry. Longevity in lumber brokerage means that you'll need to make the best use of all the resources at your disposal, including relationships with industry experts, mill owners, buyers and even other brokers.
With that in mind, we advise lumber brokers to regularly participate in organizations like the National Hardwood Lumber Association (NHLA) to access networking opportunities, training events (e.g. grading certification programs) and other benefits.
Business Plans for a Lumber Brokers Business
A common mistake for a small business owner is to launch your company without having written business plan for your startup lumber brokers business.
The key benefit of writing a business plan is that it defines the game plan. Without it, you'll be flying blind, choosing short-term opportunities at the expense of long-term benefits.
Start by defining your business mission. The process of writing a mission statement doesn't have to be complicated. From there, it's time to initiate the hard work involved with writing the rest of your lumber brokers company's business plan.
Prior to opening a lumber brokers business in your town, it's a smart move to determine how strong the competition is. Use the link below to find competitors nearby. Simply enter your city, state and zip code to get a list of lumber brokers businesses in your town.
How are you going to successfully complete with existing firms? It's important that you never underestimate the competition.
Find Good Remote Business Advice
Once you've finished assessing the competion, it's a smart move to learn as much as you can from somebody who is already in the business. If you think owners of nearby lumber brokers businesses will give you advice, think again. It'd be crazy for them to teach you the business.
However, an entrepreneur who owns a lumber brokers business in a different city may be willing to share their entrepreneurial wisdom with you, once they realize that you are not going to directly compete with them in their community. Many business owners are happy to give advice to new entrepreneurs If you are persistent, you can find a business mentor who is willing to help you out.
What's the best way to find a lumber brokers business manager in another city who you can speak with?
Here's how we would do it. Try the useful link below and key in a random city/state or zipcode.
Advantages of a Lumber Brokers Business Purchase
Every entrepreneur dreams about building a highly successful company from the ground up. However, many new entrepreneurs aren't experienced for the rigors of a startup operation.
There are a lot of factors that need to be considered in buying vs. starting a business. By buying a profitable lumber brokers business, you'll shorten the amount of time it takes to achieve a return on your investment because you'll have the advantage of a proven operation and an existing customer base.
Don't Forget About Franchising As an Option
Your chances for avoiding failure in business go up significantly when you opt to franchise and leverage their successful brand and track record.
Before you get too far along in your plan to open a lumber brokers business, you ought to check out whether purchasing a franchise might make your life much easier.
The link below gives you access to our franchise directory so you can see if there's a franchise opportunity for you. You might even find something that points you in a completely different direction.
These additional resources regarding getting started as an entrepreneur may be of interest to you.
If you sell to lumber brokers businesses, you're in the wrong place. These resources are more appropriate for you:
If you are interested in starting a different kind of business, please browse our directory of guides below.