Step 9: Develop the Timber Harvesting Enterprise

Action: During the training and initial production process, once the Group begins to sell its timber, the Programme will send its Business Development Officer to work with the Group to set up the formal enterprise. This process includes providing training in financial management and marketing, opening and managing a bank account, and appointing a manager and board of directors. If the Group begins selling timber without developing an active bank account that has money flowing into it, the Programme will remove all equipment from the site.

Rationale: Financial management and business development are obviously essential elements of any sustainable business. We have found, however, that people are not interested in learning about these topics until they have money flowing into the business.

Making the Groups do their own marketing teaches them about the difficulties involved in selling their timber. It also minimizes their expectations or dependency on us and makes them appreciate the price we offer when we do buy timber. Making them do their own marketing also teaches them not to develop an inventory, but rather to produce timber to meet standing orders. This "cutting to order" minimizes the need to re-saw wrong sized timbers and reduces waste. Finally, by doing their own marketing, Groups also become responsible for developing their own transport arrangements.

Getting the Group to put money in a bank account encourages them to manage their money productively and provides them with the capital to purchase their own equipment.

Example: Two of our Groups have now saved over 30,000 Kina each. They have used the money to purchase a sawmill and a truck for transport. By doing their own work, the Groups have come up with impressive innovations. One Group, for instance, has developed a timber chute which they use to transport cut planks down the hill. The chute is very efficient - indeed planks come down the chute so fast that people at the bottom need to make sure they stay out of the way lest they get their heads taken off!

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