Pricing Summit Says Silviculture Cost Gaps Must be Bridged With Higher Prices

Contractors say contract prices for work must reflect the increasing costs to plant and tend forests or the industry will be unable to attract and retain reliable workers and responsible owners. Now that the forest industry is recovering from the crash of the last decade contractors say they need to be able to put their companies back on financial track. The long-depressed market for silviculture services has to better cover costs in six key areas.

Pricing Strategy Sept 2013.pdf

Since 2006 the Western Silvicultural Contractors’ Association has held annual summer silviculture service sector market summits, inviting contractors and nursery operators from across the province. At these sessions, held prior to the regular bidding and negotiations season, information is shared around critical industry trends such as anticipated demand, workforce capacity, operating costs, investment risk and safety developments likely to effect competition and the market.

This year, contractors representing the large majority of trees planted in the province met in early September to take stock of the industry’s current state and to compare their expectations and experiences in the silviculture service market. The attached report is a summary of the key facts and findings of that meeting.

I am presenting these conclusions to both contractors and customers on behalf of the WSCA in the hope that they will contribute constructively to future bidding and negotiating for planting and other related silviculture services and products in B.C. The figures and estimates contained in the report should be understood as industry averages and general benchmarks. Given the range of business models operated by contractors and the various relationships that exist with customers, there will be different degrees of applicability for each individual situation. Nevertheless, given the provenance of the assumptions and conclusions in this report, its assertions are likely true for the industry as a whole and should have some relevance to most individual contractor operations. At best we intend this synopsis as an informed platform upon which bidding and negotiating can take place.