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Thread: Inflation and Production

  1. #1
    Join Date
    Jul 2008
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    Default Inflation and Production

    I've been talking to suppliers a lot and they all say they are just getting creamed on raw material and labor costs. Every one of them - every one - is seriously concerned about raising prices (again)/ They don't know how long they can hold the current price structures. Container ships costs have gone through the roof. I was talking to Tony, the owner or Royal Pedic, and he had to pay $ 30,000 more than his purchase order for a container of latex from Holland because of shipping costs that have gone wild. He wasn't prepared for that.

    Bradington Young was telling me they are on the verge of another price increase. They don't even print price books for the dealers any more, they email us pdf's because the numbers have changed so much in the past year. So dealers have to print out the 170 page price book!

    Some manufactuers are even appling surcharges to orders submitted months earlier, their argument being by the time they get everything to build the pieces, their raw materials have gone up 15 to 20%. So far, that hasn't been an issue with the lines I carry - but they have discussed it and the bad P.R they would get is what has kept then from doing it. I would absolutely flip out if they did that and I had to call my customers and tell them so.

    I know a lot of people are saying they will wait until prices come down. I don't think that's going to happen - ever. I would say don't wait if on the basis of expecting pricing to go down. I do see another round of price increases coming - probably pretty soon. The High Point Fall Market started today and this is when they have their sales meetings with the reps, and they will tell them what the future holds.

    Delivery times continue to get worse. Customer Services are suffering too, lots of new hires in the trade that have no experience and leave after a few weeks after they find out how hard the job is. The most under-appreciated position at these manufactuers are the people in Customer Service. They get an earful from both end user consumers and dealers non-stop, 8 to 9 hours every day and virtually no one ever says "thank you" to them. That's why at Christmas time I like to send them some tokens of appreciation.

    It's a terrible time. We can't get orders in a timely manner, we can't get many small favors accomplished, and prices keep climbing. Please realize that no one can give you accurate completion dates right now. When we dealers say 6 months on average, that's just speculation. Some are taking 9 months, some get done in 3 months. It's all over the board.

    Be Patient
    Be Kind
    Be Understanding
    We are all frustrated by current market conditions.
    Duane Collie
    Straight answers from thirty-six years in the business.
    My Private Messages are Disabled - Please ask questions here in the forum.

  2. #2
    Join Date
    Nov 2020
    Posts
    12

    Default Re: Inflation and Production

    I would certainly not blame furniture manufacturers for raising prices if their costs are rising quickly and unexpectedly, as it appears they are. It's just the nature of the financial situation that we are in right now. If you want nice furniture, you've just got to be prepared to pay the price.

  3. #3
    Join Date
    Nov 2018
    Posts
    30

    Default Re: Inflation and Production

    I just ordered a recumbent trike. The USA based manufacturer had the same price from 2010 to 2020 which is amazing. They only raised their MSRPs by $200 in 2020 which is nothing compared to the cost of their recumbent trikes. However, their latest catalog they left the prices off so they can raise prices if necessary.

    I was able to find one of these trikes in stock. Most bike shops are out of stock due to production delays. The manufacturer produces something like 10 to 20 trikes per day, yet they have well over 500 trikes waiting for a single component they can't get from the overseas manufacturer. They have shipped basically nothing for several months as every model they make needs this same component. One local bike shop said if I ordered now I probably could not get anything until June. The owner said he was probably going to drop the brand because customers don't want to wait nine months to a year for a recumbent trike. He carries another brand made in the UK and they are still able to deliver with some regularity and he actually had a few in stock.

  4. #4
    Join Date
    Nov 2020
    Posts
    10

    Default Re: Inflation and Production

    Although years of total reliance upon Asia to manufacture many items and component parts is now taking it's toll, it seems strange this manufacturer of trikes is in a state of peril - even survival - over a critical component part for all of their bikes/trikes. Numerous metal shops still exist that would compete for the contract to make "the single component" necessary to finish 500 bikes. There are hundreds of machine shops in every region of the country that could either make the part to customers specs or even design and make the part necessary to finish the trikes. The trike manufacturer's circumstance seems self-made. Perhaps they are short on ready cash and have all of it tied up in that particular part order, who knows....Metallurgy, Foundries and Manufacturing from China is inconsistent at best and in many instances, out and out fraud coupled with a relationship similar to working with a high seas pirate. I have seen insurance claims for death and serious injury traced back to poor and inaccurate metallurgy specifications on struts and support members made in China, metal tension and torque requirements not close to what was requested and paid for... We really need to take back quality manufacturing of many, many things we gave up too readily to the advances of NAFTA and Globalism. Self Reliance is a good thing.

  5. #5
    Join Date
    Nov 2018
    Posts
    30

    Default Re: Inflation and Production

    The component the recumbent trike manufacturer is waiting for is the derailleur. Not sure if front or rear derailleur, or both. I believe the derailleurs are made in Taiwan. The manufacturer builds their own trike frames and seat frames from aluminum in Orlando, Florida. I assume they can get the aluminum since they have hundreds of trikes made just waiting for the final components.

  6. #6
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    Alexandria VA
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    Default Re: Inflation and Production

    Another round of price increases is coming. Taylor King sent a letter out today they are increasing 5% on all orders effective Monday, November 15th. If you are considering a new TK piece, you may want to make your final decision prior to that date.
    Duane Collie
    Straight answers from thirty-six years in the business.
    My Private Messages are Disabled - Please ask questions here in the forum.

  7. #7
    Join Date
    Jul 2021
    Posts
    35

    Default Re: Inflation and Production

    Bradington Young has announced they will be increasing prices by 5% on January 5, 2022. We anticipate that all furniture makers will also be increasing prices at the start of the new year - there appears to be no end in sight due to cost of labor and materials.

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  8. #8
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    Default Re: Inflation and Production

    The best way to see what is happening in the industry and individual makers is to look at ready dates vs order dates. Here's some invoices that arrived this week These are production dates and don't include shipping times.

    Taylor King: Order date April 13th. Ready to ship date Dec 1. Time 7 1/2 months

    Hancock & Moore: Order date May 13th. Ship date Nov 16th. Time 6 months

    Hancock & Moore: Order date May 9th. Ship date Nov 16th. Time 6 months, 1 week.
    Duane Collie
    Straight answers from thirty-six years in the business.
    My Private Messages are Disabled - Please ask questions here in the forum.

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