Case Studies
Issue No. 8 - December/ 2002/january
Enviro Systems
Business model supports small investor opportunity in renewable resources
Hard-nosed business people might think planting trees as a cash crop is a ridiculous idea. Five years ago, John Chambers sold up a successful business to do just that, and now, – after some interesting times with the ATO, – is preparing to launch a uniquely green venture in a sector that predates civilisation.
Enviro Systems is vehicle for small investors who, for as little as $2000, were able to acquire a share of the annual harvest from more than 800 hectares of Tasmanian Bluegum plantation grown for firewood at Warolim and surrounding properties near Kadnook, Victoria.
“We approached this from high moral ground, more or less,” John says. “We would grow plantation timber to sell as firewood, and do something to alleviate the immense pressure on wilderness.”
Over time, firewood gatherers have “swept the forest floor clean” even of ground litter to feed a multimillion-dollar industry. Official estimates are that Australia now burns more than six million tonnes of firewood every year for better than $600 million turnover per year, at $100 per tonne retail.
Exact figures are impossible to fix since, as John says, many transactions take place “in the back of a hotel carpark”.
The unregulated ‘stripping’ of wild stands of trees also harms ecosystems by removing the ground litter many forms of flora and fauna live in—a long-term threat to biodiversity. Enviro Systems’ premise is that by making firewood production controlled and systematic, environmental damage can be minimised. On the commercial front, Enviro supplies will tend to stabilise the supply of firewood in what has been a haphazard distribution system.
Of course, the enormous barrier to entry into the plantation firewood business is lead time.
“The structure we developed to overcome it is a franchising system, as works successfully in other business,” John says. “Anybody could get involved in our scheme. The less they put...
