Most failures come from the inability to locate sufficient logs at reasonable prices. Capital will be needed to get your mill equipment to where it can produce at a decent rate. If milling costs are high, it will be hard to pass that down the line when your competition can produce material more cheaply. Markets will depend on the type of operation you have. It may be hard to expand a hobby mill into a full-blown business if you are trying to cater to the local market.
Most large mills cater to wholesalers, which means they have to move volume.
The large mills and wholesalers will set the market price, and you will only be able to follow their lead. Another option is to go into value-added. You can go to kilns, planers, molders, etc. and make a product. In my area, some have gone into log houses, flooring, doors, squares, moulding, even baseball bats. These can be offered on the retail market, especially if they are quality products.