Back to: Tenure Toolkit
Is This a Viable Business Opportunity?
What Information is Needed?
Before securing a forest tenure, it’s important to determine whether the opportunity is financially and practically viable. This involves business planning to ensure that costs align with available resources, capacity, and inventory.
Key Steps in Assessing Viability
- Forest inventory: Review the area of interest—tree species, timber volume, and age class.
- Economic viability: Consider harvesting costs and distance to mills. Logs closer to mills are worth more, and ground-based logging is cheaper than helicopter logging.
- Market research: Analyze timber prices, industry outlook, and non-timber product values. Identify local buyers such as mills and other key players.
- Technology and expertise: Use modern tools (e.g., remote sensing, modelling) and engage trained professionals to prepare technical inventory and viability reports.
- Risk assessment: Weigh tenure costs, timber markets, operational expenses, allowable annual cuts, and potential Aboriginal or Treaty claims.
- Implementation plan: Define staffing, contractors, partnerships with logging companies and mills, and overall operations.
- Financial planning: Prepare financial proposals with cost estimates, price assumptions, projected cash flows (years 1–5), and pro-forma sheets.
- Community support: Ensure leadership and members are engaged and aligned (see Module 1).
- Financing: Begin discussions with leadership about financing options and loan packages (see Module 6).
Why This Step Matters
This type of assessment—often called a pre-feasibility study—requires time and financial investment. It should be completed by qualified professionals who can prepare technical reports. These reports can then be summarized in memos, newsletters, and presentations for leadership and the community, supporting informed decision-making.