2017 Early Buy Prices

Tax man gettimg paid!!

 

the prices aren't too out of whack, i paid less than $10 more a ton for the spruce pointes earlier in the year at a different dealer. there aren't multiple dealers selling at below cost, something is fishy.

 

Of course you are right. There is a fear that if the world finds out they are making money, Armageddon will start. But they probably buy them for 50% below retail roughly.

 

I have word that a third party bought some excess inventory from the mill at fire sale prices. you are seeing the results as they move it to the retailers. I would have bought some, had I known (like I did with the Blazers). so jump on them while they last.

BTW, there's no 50% margins out there... not even close...

 

Love those fire sales.

 

Dan has certainly heard of volume buying...
I may be old and foolish, but still have some of my wits.

For all of you that missed artc's comment....
We were told that everyone gets the same deal.
That is what we were told. (on some of these brands)
What changes retail price, from region to region, is shipping.
If it cost 40 bucks a ton to ship to New England, and 20 to some place
2000 miles closer to the west... then obviously the retail price can be different.

So if you are told something, and it isn't true, THAT is why I said
"it shouldn't be a factor on how much you buy"..
That said....
I am NOT implying that is how it went down.
At all.
The example of buying from a distressed seller, and then reselling is
possible, and understandable....

IMO, if someone, near us, is selling some of those mentioned, that cheap,
they aren't making enough to stay in business...
Again... IMO...

Dan

 

This will give you some idea of the space they have .

 

X2

 

Load up Russell these prices won't come around again

 

So the deal is that you interpreted this one way, when it was probably was meant differently; everyone gets the same deal on the same amounts. (I don't know this for a fact, just taking a guess).

We too have products where everyone gets the same deal; Buy 1-4 units and pay $700/each. Buy 5-10 units and they are $630 each. Buy 100+ units and they are $550 each. For most of our stuff though, the price is dependent on both volume and type of industry buying it and our relationship to the customer.

Take 2 retailers of pellets; normally 1 retailer pays $180/ton for SP for up to 10 tons (yes, I'm making up numbers), but another pays only $160/ton for up to 10 tons. Why? because the first will only sell about 20 tons all season and the second will sell 150 tons all season, just doesn't want to hold too much in inventory (and I'm not talking pre-buy either). And, the second may be able to take extra if the plant asks him to on occasion while the first can't/won't take extra at all.

So, when the plant states that it will give the same deal to everyone, then it is saying that both retailers in the example, regardless of past relationships will pay the same amount for up to 10 tons.

IF this is the case, then the wording could be misleading at a quick glance but is not, in the end, incorrect.

 

I don't know for sure how much more clear I can get.
But I'll try..
The guy that we buy most from, told us that EVERYONE gets the same pricing.
BBS get a "little" better..
The varying threshold that you describe, probly applies to regular dealers vs. giant dealers...
A guy buying 1,000 and the guy buying 10,000 (for example) are paying the same.

While we don't come close to what BBS sell, and neither does anyone else,
our prices are consistently lower than anyone around. (Even BBS save for their sales))
We could not do that if they, (bigger volume guys) got a better deal.
At most, it would be in the $5 range... and that would be if another distributor
was trying to steal you away to his brand..
Henry and I both like our guys a lot, and I doubt VERY much that they are
not being up front with us... they always have been since dealing with them,
and have bailed us out when there were shortages, when no one else around had any..

That is possible.... however, it is the opposite on how we do it..
This is the time of year that we ramp UP, not down..
We try to get at least a load a week.
Because the busy season is coming up,
that goes up.. sometimes 3 loads.
So it would be counter productive, for us, to offer product at a LOWER price, now,
so that we can replace it.. When it gets real busy, they are hard to get,
when you want them... it isn't like calling Pizza Hut...
At times, in about 5- 6 weeks, we move more than we can get..
It's nice to have about 4-500 in stock, before slam time..
so that particular POV you describe, does not fit our process...
Perhaps it does for others.

I really do not know that as a matter of fact.

No offense taken!..
We may be low volume, compared to others..
but we sold more Douglas Fir last year, than anyone around us..


Dan

 

Passed a small place that is a combination lumber yard / hardware / True Value in Weare, NH and they had Lignetics out for $229/ton. That is dang low for this area. I have never seen them with pellets before - not that I have looked there - but I am positive they have never had any sitting out where traffic could see them (I pass them every day).

 

Did you buy any?

 

Nope - even after moving 5 tons into the house from my fire buy last year, I still have a ton outside. And, I already had about 1.5 tons in the house. So, I'm set for another year. Wish I did have somewhere to put some though!

 

By the time you need to be looking, there is sure to be another "deal" someplace...
I'm confident you will find it!!!


Dan

 

I will let you in on a little secret...with maybe the exception of the SP which I understand they had a mountain of and give a very good deal if the two guys took some volume off their hands...the pricing has way more to do with the price of the Canadian dollar than any discounts or volume rebates (which don't really happen in our industry by the way)...When (not if) the C$ starts to rise again...watch all your Canadian suppliers raise their prices ...since they sell US$ but most (if not all) of their costs are in Canadian...so if the C$ rises, they will have to raise their prices to keep margin....it's really nothing more than simple math....

 

Since march the c$ has been +\- $0.01, for the year +/-$0.02 cant see that driving down the cost of pellets more then $4 a ton, more like a dollar. Now if it sirges, sure. But this drop has nothing to do with currency. It has been pretty stable for 1+ year

 

In May the C$ was 4.5 cents cheaper than it is today...so you are talking more like $10 per ton..but then factor in shipping and trucking and it could be more....the point being that it plays more of a factor than most think...Somebody stated that if these are the brands you like and still have access to them at these lower prices, I would suggest you do stock up as those prices probably won't be around too much longer....in my very so humble opinion....