Are logs a sideline or a full time business ?

[butler]

My lad who works for me told me yesterday that he and his mate, who used to split logs for me on satarday mornings, were discussing how their preference for log shapes difered. Jonny liked brick shapes, the other like dairy lee traingle shapes:lol:

Now this is 2, 21 year old lads

 

was it puff puff pass?

[Stephen Blair]

that took me a couple of seconds to work out:confused1: lol. No they are good boys, just sad:lol:

[One Eyed]

profits profit! If he didnt put his prices up to balance it out he would make less.

 

You're quite right. Unfortunately though, it's not always as simple as putting up prices to balance it out. Granted, heating is as essential to a family as shelter and food but that doesn't necessarily mean that you can just raise prices in proportion to inflation to make the same profit as the preceding year. It's no revelation to state that we're in an epic recession - that means the public (especially the less wealthy) will hang on to every last penny they can before handing over any more money. The proof is in the pudding - the puddings that are being left on supermarket shelves because they are a luxury and not a necessity. Where people were happy to spend twice as much for a branded loaf of bread (and, in my opinion a better, softer one) during our boom years, nowadays the supermarket "economy" labels are selling out fast while your Kingsmill loaves are ending up with "whoops" stickers on them.

 

In a proper recession, people begin to look out for number 1. What does this mean for firewood? In my area it means that some of our otherwise loyal customers look elsewhere; they find suppliers 15 miles up the road who haven't increased their prices. As far as they're concerned, we're just greedy fat cats like the rest of the energy suppliers.

 

Truth is, to keep up, we have to process more and sell more than last year. Yes, our prices may be a little higher than the previous year but not to the extent that we could sell the same amount of firewood and arrive at the same amount of profit as the previous year. Therefore, we have to grow to survive. Things will be different in a boom period (if indeed the monetary system hasn't collapsed before then) but we have to grow to achieve the same amount of profit as the previous year.

 

I truly hope others in the trade don't face this same sort of problem but this is my experience in the north

[Michael C]

Good post above, and recession or no recession, surely there are very few log business's (or business's of any kind) that dont want to increase their sales every year.

[One Eyed]

It may have been quicker/simpler to illustrate this way:

 

40 years from now, £20k profit isn't going to be worth anywhere near what it's worth today. That's what's wrong with making the same profit year after year and hence the need for growth

[Daniël Bos]

It may have been quicker/simpler to illustrate this way:

 

40 years from now, £20k profit isn't going to be worth anywhere near what it's worth today. That's what's wrong with making the same profit year after year and hence the need for growth

 

 

In economics, keeping up with inflation is not growth, it's keeping up with inflation:001_smile:

[skyhuck]

In economics, keeping up with inflation is not growth, it's keeping up with inflation:001_smile:

 

[One Eyed]

In economics, keeping up with inflation is not growth, it's keeping up with inflation:001_smile:

 

 

Indeed but how do you intend to keep up with inflation without growing your business?

[skyhuck]

Indeed but how do you intend to keep up with inflation without growing your business?

 

By simply passing on the price increase you are incurring.

[Daniël Bos]

Indeed but how do you intend to keep up with inflation without growing your business?

 

 

Increasing prices in line wih inflation (or otherwise rising costs) is not growth.