FEASIBILITY STUDIES AND BUSINESS PLANS
The Beck Group assists clients by completing forest products manufacturing feasibility studies that offer independent third-party evaluation of the costs, benefits, and risks associated with investments in new ventures or improvements to existing operations. Through a combination of our benchmarking data and work with hundreds of forest products manufacturing operations, we have the experience and knowledge to make accurate assessments of key business development factors such as costs, yields, sales values, production rates, etc.
A business plan is a common follow-up to a feasibility study and is often used to attract investors to a project. Using the information developed in the feasibility study, The Beck Group assists clients in developing business plan documents that outline their companies’ goals and the strategies those companies will use to achieve those goals.
CASE STUDIES
Mass Timber Manufacturing Feasibility—The Beck Group recently assisted a confidential client by completing a mass timber manufacturing feasibility study. Beck assisted by analyzing the size of the glulam and CLT market in North America with specific focus on the Western U.S.; using its sawmill database to evaluate the supply and cost of raw materials; providing a third party review of financial modeling including estimates of capital costs, ongoing operating costs, and key metrics such as productivity, downtime, and raw material to finished product yield factors; and providing conclusions and recommendations about mitigating project risks. All of Beck’s work was summarized in a written report that the client will use to attract investors to the project.
The mass timber manufacturing supply chain is an area of Beck expertise based on nearly 10 years of involvement in the International Mass Timber Conference as presenters, International Mass Timber Report authors, and other project work similar to this one. The client now has the information needed to answer investors’ questions and demonstrate the project’s timely strengths.
Wood Pellet Manufacturing Feasibility—A confidential client retained The Beck Group to assess the feasibility of a small-scale pellet manufacturing operation in California. Beck’s roles included assessing the annual supply and cost of raw material available to the prospective operation; estimating the capital cost for constructing the equipment to manufacture wood pellets; estimating the operating costs for manufacturing wood pellets; and estimating the size of the wood pellet market and their selling price.
Our staff stays abreast of dozens of biomass utilization technologies, as this is a Beck core competency. This enabled our client’s management team to make a well-informed decision about the feasibility of adding wood pellet manufacturing to their existing operations.
Biomass Cogeneration Feasibility—The Beck Group recently completed assisting a sawmill client assess the feasibility of adding biomass heat and power to their sawmilling operations. Beck’s tasks included identifying the supply and cost of fuel available to the project. This included a portion of the sawmill’s own by-products and biomass fuel sourced from urban wood waste and logging residuals. Beck also estimated the capital cost for installing a new boiler, turbine generator, and interconnecting to the grid. Finally, Beck analyzed the market for renewable power and estimated the price at which the project could sell its power to the local utility.
Our staff stays abreast of dozens of biomass utilization technologies; biomass utilization is one of our core competencies. This enabled management to make well-informed decisions about the viability of adding power generation to their facilities.
Council of Western State Foresters—The Beck Group was retained by the Council of Western State Foresters to assess the feasibility of manufacturing Wood Wool Cement and Wood Fiber Insulation, both of which can be manufactured from biomass and small diameter trees. For each technology, Beck assessed the markets for the products produced; the types of equipment needed to manufacture the products and the capital costs for purchasing and installing the equipment; ongoing operational costs; and the supply and cost of raw materials. A copy of the report is available here: https://bof.fire.ca.gov/media/gkkfdgqc/cwsf-wood-wool-and-wood-fiber-insulation-study-final-4-26-23_ada.pdf.
To maintain this core competency, our staff stays abreast of dozens of biomass utilization technologies. This feasibility study enabled the Council to share details of two such technologies that show strong potential to combine carbon sequestration with innovative building materials. Entrepreneurs can use the information to begin planning profitable business ventures and enable forest management that will make fire-prone communities safer.
Fence Mill Feasibility—The Beck Group assisted a lumber manufacturer interested in developing a greenfield sawmill designed to produce wood fence pickets in the U.S. West. Beck’s scope of work included evaluating the local timber supply and demand balance for the target species, analysis of the market for fence pickets, modeling likely financial and operational performance (including sawing patterns, process flow, product mix, staffing, and manufacturing economics), evaluating potential sites for suitability, collaboration with sawmill design engineers on equipment specifications and process flow, and evaluating impacts on the company’s other operations.
Our knowledge and experience in timber supply and demand, specialty forest products manufacturing, and forest products markets helped our client develop a solid plan for constructing a new sawmill to produce specialty lumber products.
Chelan County Forest Products Campus—The Beck Group analyzed opportunities for developing a biomass campus designed to utilize small diameter trees harvested during forest health and wildfire mitigation forest management treatments. Using supply information generated by Mason, Bruce, & Girard, Beck identified three small diameter utilization technologies that complement each other, have secure markets for the products they produce, and that are appropriately scaled for a biomass campus. For each technology, Beck provided preliminary estimates of capital costs, ongoing operating expenses, yields, productivity rates, and financial projections.
Our staff stays abreast of dozens of biomass utilization technologies; biomass utilization is one of our core competencies, which enabled the client to identify a biomass campus concept based on the most current information about technologies and production, which will lead to a safer community.
Capital Project Planning and Feasibility Analysis—The Beck Group assisted this confidential South American lumber manufacturer in analyzing several potential projects for expanding its operations as part of an overall plan for the sale and recapitalization of the business. The client, who was in negotiation with a potential purchaser, retained Beck to independently assess the feasibility of several capital projects that were focused on increasing the plant’s production capacity. They included additional lumber dryers; added sawmill edger capacity; installation of a planer mill; and the addition of a small remanufacturing operation. Beck reviewed capital cost estimates and vendor quotations, completed a financial analysis for each project, and projected the mill’s improved performance. The client used the finished report to sell the business.
BECK staff members have extensive industry experience in capital planning projects and feasibility analysis of wood products businesses and are frequently asked to assist clients in this important area. Whether a small foreign lumber producer or a larger North American lumber forest products manufacturer, The Beck Group can assist. We work closely with various engineering firms and equipment vendors and have a track record of arriving at practical capital improvement plans that achieve their intended results.
San Carlos Apache Sawmill Planning—After decades of planning with the assistance of The Beck Group, the San Carlos Apache Tribe now has an operating sawmill in eastern Arizona. The Beck Group helped the Tribe plan and develop a sawmill that is scaled to match the amount of timber available from the Tribe’s forest resources on reservation timberlands; that can handle a large range in log sizes; and that can produce lumber to a broad range of thicknesses, widths, and lengths. The planning assistance included timber supply, market, and product line analyses; assessment of a range of sawmill equipment alternatives; feasibility assessment and business plan development; assistance with project financing; and work with an engineering and installation contractor on equipment procurement, installation, and start-up planning.
Beck consultants’ extensive hands-on experience in the sawmilling world enables us to see a facility not merely as an investor might, but also as an owner would. The client gained the means of utilizing its lands to help improve Tribal members’ economic outcomes in sustainable fashion.
Biomass Campus for Small Diameter Tree Utilization—The Beck Group was retained by the Sierra Nevada Conservancy to complete a biomass supply study and biomass utilization feasibility study focused on Tuolumne County, California. Beck’s work included developing a detailed estimate of the supply and demand for biomass and small diameter material in the Tuolumne County region. This included estimates of the annually available supply and its delivered cost. Given the results of the supply study, Beck then analyzed the feasibility of a biomass campus that included a biomass power plant, small-scale sawmill, post and pole manufacturing operation, and bundled firewood manufacturing operation. As a direct result of this work, Heartwood Biomass is currently developing a similar biomass campus concept in Tuolumne County.
Beck’s experience with fiber supply and demand, small diameter utilization technologies, feasibility analysis, and business planning all combined to attract a private company to invest in developing a biomass utilization facility.
Business Plan Assessment—The Beck Group completed due diligence for an investor group considering construction of a greenfield multi-facility wood products manufacturing and biomass energy operation in the U.S. South. Beck’s tasks included critiquing business plan elements including review of the firm’s financial and operations model, financial projections, timber supply and demand analysis, equipment selection, productivity assumptions, manufacturing costs, recovery and product mix, raw material supply and product offtake agreements, and management team qualifications.
The Beck Group’s extensive knowledge of timber supply, forest products manufacturing, and biomass power allowed our client to better understand the wisdom and ramifications of investing in the planned businesses.