Has anyone else noticed.........hb

ScottMP

we are in tought imes but I have to feel that this is the same conversation that contractors had in the early 70's and probably the 40's and every other time that price increases seemed insurmountable.

As Mark says, pass it on and become a better salesman. I have sold more mod/cons this fall and winter than ever before. I think its because I inform my customers that fuel prices are only going in one direction. Joels right, now is the time.

I know its tough but to try and beat the hacks at thier own game is a dead end street. Let them have the dirt road, I'll take the highway.

Scott

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heatboy_2

that it's more......

....... difficult now to be in business now than it was 10 years ago? It just feels like the pressures are much greater now. With spiraling insurance costs of all kinds, energy prices going insane and the tail wagging the dog when comes to pricing, 2007 was a tough year. 2008? I guess we'll see.

Dave Yates (GrandPAH)_8

sure have

We were just discussing this yesterday. It's a constant assault from (seemingly) all sides.

Paul Pollets

Agreed!

The competition is always out there, as well as the Hackmasters; large material cost increases; increased tax burdens, 39% increase in medical benefit costs....takes the fun out of it, for sure.

I always wonder how the "others" are making it work, and if making a decent profit is part of the picture.

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Rocky_3

Tough times

Check register shows a continual hemorrhaging of money to insurance companies-Last years worker's comp was over $40,000 alone. And I'm a small company. Factor in Contractor's liability policy, don't forget that the work vehicles have to be insured too, shop building insurance, medical for employeesEnergy costs are putting the squeeze on average homeowner; pulling excess dollars out of the economy. Oh yeah, that $3.35 a gallon gas?... (I know some of you are paying more than that), yeah, at -35 below, my 7 vans don't quit running..figure about $350 bucks a day just to cover gas! "Gee, Rocky...with your labor rates you must be getting RICH"...

Warm regards from chilly Fairbanks,
Rich Rocky

Steve Ebels_3

The hydronics business

It would be fun if you didn't have to make a profit in oder to survive.

Looking over our expenses for last year showed our fixed costs increased a tad over 14%. I'm talking about fuel, all the insurances, comp, taxes etc. The kind of stuff one has little to no control over.

I lock horns with someone who's "doing it for less" almost every week. Try as I might, I just can't bring myself to compromise business practices, safety and installations that way. I'm not looking for anything more than survival in 08. The only thing and I do mean the ONLY thing that's moving at all is alternative heating equipment. I.E. wood fired boilers and heaters. We did a total of 1, that's ONE, new house this past year. I don't look for any in 2008.

Tony_23

Cycles

I remember, in the early 80's when the SBA loans were 21-23% interest.
1989 brought a doubling of liability insurance rates.
I don't want that back, either.

For me, one new house in a year is typical. Last year we did zero. Retrofit work pays better.

Lowball hacks and new startups will always be there.

I'm always looking for ways to make my operation more efficient, just like we all look for ways to reduce our customers' energy costs.

My Grampa always said, "Stay calm, fretting won't help or change it." Hard to do sometimes, but still true.

Good luck to all in 2008 !

Tony

joel_19

Fear not!!!!

Fear not!!! fine soldiers on the hydronic battle front!!.

While we are all being hammered with lack of new homes and remodle projects and rising prices remember that risisng prices can be our friend.

high oil and gas prices and the green movement are encouraging consumers to seek out solutions now more than ever before. Yes we must do battle with the hacks but we have the knowledge weapons and tactics they do not!

Mod/cons and ECM circulators are probably the biggest advancements in hydronics in what 25-50 years??? It's not an evolutionary leap it's a revolutionary leap.

Take your training and tactics and beat billybob the enemy silly.

I know things look bad boys but I feel we will be TRIUMPHANT!!!!!!!!!!!!!

[Deleted User]

Time to pass it on...

We adjust our prices quarterly. It is time to re-evaluate and add to the overhead to compensate for the base increases we are seeing. To not do so is foolish and guaranteed economic suicide.

And I agree, we, the well trained great performing contractor will be at the top of the heap when the dust settles.

Just keep an eye on the bottom line and adjust as need be. The consumer will understand.

We have an inflationary clause in our contracts that usually opens their eyes pretty wide.

If you're not in business to make money, why are you in business?

Hang tough.

ME

Mike T., Swampeast MO

Other businesses affected as well. One (for me) is small, mainly "gifty" retail. Fixed costs all up significantly and flat (at best) overall sales for 2007. Wholesale prices jumping faster than I've seen in 15 years in this business. Higher end merchandise sales stayed decent through the 2nd quarter but dropped off in the 3rd & 4th.

Another (for me) is an RV camping/travel club. Membership as well as attendance at events has dropped as fuel prices have increased.

2008 looks to be a wild ride.

Weezbo

by adjusting 3% a year,...

things seemed to just about came out as a wash from year to year, however every year around the 8th of January i always noticedd the precious metals market increases activity Upward

the Wholesaler said that Danfoss was making a 6% increase this year back in December....trade mags seem to have some good people looking to the future who get the word out ahead of time.

my buddy who owns a couple wholesale /retail pluming out-lets here in the state always clues me early also...i just keep plugging along little by little one wins the race..going to show ,"it is not always the swiftest to whom goes the race." *~/:)

heatboy_2

One of the big builders here.....

...had, what one would call, a fire sale last month. There are so many homes that were built on spec that sit empty, the builder slashed $100K right off the top during one of the weekend sales blitzes. How about the guy who paid full price for one 6 months ago? I wonder how many already underpaid subs took it in the shorts on that deal?