One Eyed

I tried for ages to find someone importing them to UK but to no avail Hawk Eye. I agree they do look like good machines - TW Pro MP was my interest.

This is simply not true.

If you sell 100tons at price A, to keep up with inflation all you need to do is sell the same 100tons at 1.05xA.

Assuming all other costs associated with that produce have not risen in price more that inflation there is simply no need to grow!

 

I'm happily running my stagnant bussiness, take on some side ventures if the mood takes me. Make sure I have dinner with my whole family everyday, take my girls to school in the morning and squezze a little work in between if I feel like it.

Arriving at the same profit as the previous year by putting your prices up in proportion with inflation (i.e. 100 tons at 1.05xA) is not keeping up with inflation. Your family dinner has just gone up 5%, so has your girls' new school clothes/shoes and stationary, not to mention the fuel costs IF you drive them to school. In fact, everything has gone up so how can you claim to be keeping up with inflation?

Remembering that my comments were directed at the question "what's wrong with making the same profit every year?" - You've not had a pay rise since starting your business because all you've ever done is increase your prices to attain the same profit as the year before yet, all costs of living have increased!

Each to their own but I feel much more secure growing my business and I do this at no cost to my family (agree with you there - family is priority!).

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

I know and my earlier post was trying to get that across. What I'm trying to say, as per the original question of 'why grow?' and 'why not make same profit year after year?' is that 5% inflation gives a compelling reason to expand. Find other relevant products to sell, add a kindler to your set up, buy a fleet of artics and sell your wood all over the world - whatever. If I make the same profit next year I will be poorer for it because all my living costs will have gone up.

I think I've been misunderstood somewhere because my argument is that increasing prices in line with inflation doesn't work. I'm saying that to overcome rising costs and not go stagnant a business needs to grow. Just because I use the term "grow" in the same paragraph as talking about increasing sales and prices doesn't mean this is my definition of growth.

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?

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

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

whats wrong with making the same profit every year?

How about 5% inflation making that same profit less valuable for the coming year! To match next years profit with last years profit, after all your expenses have increased, you're going to have to grow.

Ha thanks that's all I want!

Lately I've been in the market for several bits of arb-related machinery/equipment, looking to spend a total of around £15k. Since the whole planet is in a bit of a financial mess you would think there'd be no problem in getting someone to snatch your money out of your hands and push their product on to you, yes? My experience has been not-so!

Now I know that in spite of the economic climate many are still very busy but I can't believe the reluctance of some companies to return calls, email back within 48 hours (if at all) or even answer the phone! Damn it's frustrating!

Is a zombie sentient? It's braindead, but is mobile, feeds on brains, has a desire to kill. It's not aware of its actions, and is even less aware of what it actually is. It's just acting (chemically) on impulse and instinct.

No, a zombie is fictional. The rest was interesting though, thanks.

This is an interesting thread. An update would be good

Japanese knotweed?

God? Atlantis? A way of tormenting the users of arbtalk?

Hello, I'm a long-term lurker in the forums but recently signed up as I'm bound to be seeking advice at some point rather than feeding off other's questions/answers.

A used firewood processor for sale?

The north of Scotland? I would suspect the many trucks you see are headed for Balcas:

Balcas?s hunger fuels feedstock wood prices ? and controversy - Energy

Anyway, PM coming your way soon, I might be able to help :-)