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----------------------------------------------------------{ July 31, 2008 }New Opportunities for Profit
New Opportunities for Profit
Part of the Real Tangible Value™
Package from Amerimulch
It is no secret that the colored mulch industry is facing a severe challenge due to the lack of availability of low-cost wood feed stocks. Because of the poor state of the housing industry, land clearing has slowed to a crawl. Lumber mills are hurting and the general economy is flat. There just isn’t a lot of scrap wood being generated.
To complicate the problem even more, the record increase in the cost of energy has created competition for wood waste because of its BTU value. In some cases, mulch producers with grinding capability can earn the same margins as colored mulch by selling ground wood directly to pellet mills to fuel home heating stoves or to utility companies to fuel boilers to generate electricity.
At our last Amerimulch Customer Tribute held in October 2007 in Biloxi, Mississippi, Dr. Tim Sydor presented a study entitled, Raw Material (Wood) Availability and Industry Trends by Regions. Dr. Sydor summarized his comprehensive report by saying there was plenty of wood supply available; you are just going to have to pay more to get it. Why? Because it is in the form of prime raw timber, not industrial generated scrap. (A copy of Dr. Sydor’s presentation, is located in this section of our resource blog.) One thing we can be certain of is that retail demand for products and services that help beautify gardens and landscapes will remain strong. However, the products and services our industry may offer to the consumer could change dramatically, due to material availability and economic forces.
From the Amerimulch perspective, we have a vested interest in helping to sustain our customer’s and our industry’s viability and profitability. For the past year and a half we have been developing new products, new systems and new equipment that provide ways to supplement wood mulch as well as new products that may be used as alternatives to colored wood mulches.
As these products complete their development and field tests we will bring them to your attention along with much more information. Our goal is to bring you, our customer, new and profitable opportunities to help you grow your business even through these difficult economic times.
Posted at 12:19 PM | Link to this Article