LumberJocks

On A Roll !!!!

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Blog entry by sawblade1 posted 06-18-2012 04:01 AM 1152 reads 0 times favorited 7 comments Add to Favorites Watch

It has been a while since I have posted on LJ’s since my layoff from work or as it was called unjust release I have had the time to study what has been the killer to my business, one of the three factors have contributed was lack of ample time to market properly now that I have the time this is no longer an excuse. the second one was marketing to the wrong people as it has been a eye opener finding out the real people to sell to!!! the third one was a less obvious but dirty problem called Economic strangulation which is the purpose of this blog. Economic strangulation can affect any business that is a manufacturing,distributing, or retail type. It is when a supplier raises prices unfairly to choke off competition to another business they supply. Let me explain using my business as an example. Here in Akron we have approx 9 woodworking businesses active at any given time so I was getting my lumber from a Lumber yard in the next county I was buying 5/4×6”x8’ western red cedar at 8.00 a board 2 years ago as I started to make these chairs in quantity to sell the price went up to 10.50 then to 11.52 a board raising my material cost for my Adirondack from 48.00 to 69.12 add screws, glues, and finish it goes up to 89.12 or $90.00 now add 2.5 hours (good conditions) at 35.00 per hour 70.00+ 90.00= 160.00 now I found out he was supplying a competitor doing similar chairs at the 8.00 per board price. making his chairs at 140.00 give or take. Now I found a place in Washington state to ship a lift of 240 board @ 7.54 per board shipped to my door HA that bring my chairs down to 120.00 let’s play. I also found hardwood out of state to be cheaper shipped to me so I am on a roll to fly under the radar sometime the problem is not all our fault but it will ultimately be ours if we don’t do something about it. BTW most of the local yards do this in my area. I will be posting more in the future on how things work out :)

-- Proverbs Ch:3 vs 5,6,7 Trust in the lord with all thine heart and lean not unto your own understanding but in all your ways aknowledge him and he shall direct your path elmerthomas81@neo.rr.com



7 comments so far

View dbhost's profile

dbhost

5386 posts in 1952 days


#1 posted 06-18-2012 04:42 AM

Sounds like you need to bypass the lumber yard and make friends with a mill operator or sawyer directly, bypass that middle man if you can…

I thought price fixing was illegal though. Kind of hard to prove but you might have a case there…

-- My workshop blog can be found at http://daves-workshop.blogspot.com

View S4S's profile

S4S

2123 posts in 1401 days


#2 posted 06-18-2012 05:34 AM

Glad to see you in such good spirits . It looks like things are better for you , and that is nice to hear .

View stefang's profile

stefang

13528 posts in 2054 days


#3 posted 06-18-2012 08:20 AM

It sounds like you are on top of the problem.

-- Mike, an American living in Norway.

View pastorglen's profile

pastorglen

258 posts in 1410 days


#4 posted 06-18-2012 02:09 PM

Good for you! Let the buyer beware.

-- Glen, Pennsylvania, Colossians 3:23 "Whatever you do, work heartily, as for the Lord and not for men."

View Kenny 's profile

Kenny

260 posts in 1168 days


#5 posted 06-18-2012 06:11 PM

It’s good you got around the issue, but you’re just walking away may not be the best answer.

Let me explain: there are obviously other contractors, woodworkers, etc, who use this yard.
LET THEM KNOW TOO!
If you were being price-gouged, others are too. I’d look up every contractors name in the area and give them a call. I’d attend woodworkers meetings and tell them (I’m sure you have an area club).

This yard hit you in the wallet, return the favor!

-- Kenny

View sawblade1's profile

sawblade1

754 posts in 1747 days


#6 posted 06-18-2012 08:47 PM

Kenny nice Idea but most of them are my competitor in some way LOL where I plan to do the damage is with lower material cost and better service areas where they can’t/ won’t compete :)

-- Proverbs Ch:3 vs 5,6,7 Trust in the lord with all thine heart and lean not unto your own understanding but in all your ways aknowledge him and he shall direct your path elmerthomas81@neo.rr.com

View jack1's profile

jack1

1945 posts in 2747 days


#7 posted 06-18-2012 10:35 PM

Sounds like you live in an area where nepotism isn’t a bad thing. Been there done that. Get em where it hurts, in the pocket. You might even sell some to your friendlier competitors that are getting screwed like you were just a bit more than you pay to hurt the lumber yard. Just a thought.

-- jack -- ...measure once, curse twice!

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