View Full Version : Immediate attention !!!!!
10-28-2010, 08:37 PM
Copper is on the rise and it's on the rise in a big way. If you watch the commodities markets you will see that it is going through the roof.
I recommend you buy as much as you can now in cable and fixtures and hoard it. Who knows how much higher everything will be by next spring.
The cost of non-copper raw materials used in the manufacture of wire and cable have increased over the
past year and dramatically over the last several months.
These cost increases that have been absorbed in our wire & cable products include, but are not limited to:
PVC Resins (10%) Tin Coated Strand (76%)
Plasticizers (42%) Ethylene (12%)
Polypropylene (9%) Packaging /Drums (14%)
Polyethylene (17%) Transportation/Energy (8%)
Our continued efforts to reduce costs through manufacturing, operational efficiencies and cost reduction
programs cannot offset these dramatic increases in raw materials. Every effort is taken to isolate our
customers from these cost increases while continuing to provide you with the highest levels of service and
quality products. Unfortunately, the recent velocity of these cost increases in today's market is making this
an ever growing challenge on all of us.
Because of all of these factors we must adjust future prices for the following categories:
Lead Wire/Hook Up
- PVC 5%
- Cross-Link 3%
- Silicone 2%
Portable Cord 5%
Electronic/Low voltage 5%
Welding/Battery Cable 3%
All Other Categories 5%
Thank you for your continued support and business during these difficult times
10-29-2010, 12:45 AM
one need only look at a 100 christmas light set at your local big box store. imagine how little copper is in a 22 guage cord that is around 35 feet long. yet, this little box of light that used to be a buck everywhere and anywhere just 3 years ago is now 3 bucks. extension cords also really get your attention now. plastics tend to track the cost of oil and gas.
10-29-2010, 01:24 AM
Hoarding will lead to more scarcity and thus higher prices. Self-fulfilling prophecy and all that...
And who can afford to tie up resources in shelf sitting stock these days anyway?
INTEGRA Bespoke Lighting
10-29-2010, 06:25 AM
Not so good "advice"
Why would you want to put your cash reserves into storing (hoarding) hard goods while experiencing a volatile market where credit is in short supply and competitors are pushing prices lower? To do so could be a recipe for ruin.
Prices fluctuate. Stuff Happens. Best you can do is to ensure you have accurate pricing for your components and supplies and quote the client accurately on the contract. Let your distributor do their job and stock the inventory. If you are pricing your systems properly, a few bucks increase on a fixture will not really hurt you all that much. Component costs should be a 'flow through' expense to the customer. As they go up or down, so does the system cost. Stuff happens.
Not too long ago Copper (and every other commodity) soared in price. Times were good, growth was pushing 10% and higher in developing countries, demand was strong globally. We saw it in the price of wire and fixtures. Did anyone run out and buy up a bunch of wire or fixtures to try to stem the increase in systems cost? Nope. So why do it now when we are experiencing what is probably a short burb? A few bucks more in component costs is not going to stop someone from buying an outdoor lighting system.
Tell me, when fuel is about to rise in price (as it dramatically did last week) do you run out and fill up a bunch of 45 Gallon Drums? Didn't think so.
10-29-2010, 07:29 AM
Im not about to hoard it but I am looking to go ahead and buy a pallet of cable again. Being able to buy wire in bulk has afforded me better pricing and also the ability to have what I need in my trailer when I need it. No more running short then having to scramble because someone wants to add a zone.
Actually we did run around and fill drums with fuel after Hurricane Katrina :) had to run the generators for a month!
10-29-2010, 11:57 AM
Buy low - sell high!
10-29-2010, 01:18 PM
david, don't worry those light will be around 99 cents again. just a wait until Dec 26.
you can buy next years christmas lights on the cheap...
10-29-2010, 10:44 PM
I'd say I haul away about 1,000+ lbs of Christmas light per year. Use to I could sell em for scrap metal but they no longer will pay for these lights, guess there is more plastic junk in the wire vs the copper. I might start a stock pile and sell them on Craigs List next year instead.
10-30-2010, 12:02 AM
the prices of items that contain plastic and copper are getting up there. direct from the manufacturer, I bought a 40 foot container load of artificial lit foliage items in 2008- wreaths, garland, etc. I used that over 2 years of new Christmas clients, and this year I bought another container. the prices on those same items have went up a minimum of 25% and some items are up 35%. I hope that does not happen again, but given that the 2008 prices were about 25% higher than 2006, I would say it is likely that copper and plastics will continue to creep up. but I don't have the funds to stock up for more than 2 years worth of Christmas stuff anyway.
10-30-2010, 11:37 AM
So goes the declining US dollar.
Housing prices go down, commodities and food go up.
Our industry like many others has been slow to react to the fundamental shifts in the economy.
People only accept change when they are faced with necessity, and only recognize necessity when a crisis is upon them..
- Jean Monnet, father of the European Union
10-30-2010, 06:56 PM
In most cases i would think that acting before reacting is the better choice, however in this case our market is just to volatile to act upon. History be told prices will continue to rise and as always its passed on to the consumer in some form or another.
IMO, wrong time to accum., should have been back in Jan. - Mar. 2009. No buy low sell high here, shows just the opposite. Price is rising and relative strength is falling, good sell signal.
Back in the first half of 2008 it made numerous attempts to break $400, all failing. Look where it is now, approaching $400 not saying it can not breakout. Wait for it pullback to test $400 after it breaks out.
Here's a link to a weekly copper futures chart, you can also change it to daily if you wish too.
10-31-2010, 02:27 PM
Price of materials MUST affect your sales price or you will go out of business. There is always the tendency in investment to look back at a chart and said "Oh I should have..." but as a business planner, we each must look at our methods and purchases adn make the decisions that are best for each.
Smart business owners always follow the daily/weekly fluctuations and fundamentals of any raw material that
effect your bottom line. I am also an active trader, so "Oh I should have...", was a great trade. My costs are
padded nicely for quite some time. My dad always told me, " when there's blood in the streets, the smart money's buying".
10-31-2010, 05:15 PM
Volume is also a consideration. If you have the purchasing power, that can make a difference. I know that a lot of stand alone Landscape lighting companies are smaller operations and have to watch their costs, but if you can buy 2-3 pallets at a time you can get some considerable savings. Unfortunately with a lot of fixtures using copper it's more than just the wire that we have to worry about when it comes to rising costs.
11-01-2010, 02:10 PM
Volume is the real key here.
Buying wire by the pallet has more benifits than just the cost alone. The cost savings of having to ship in reels seperatly and the time taken to move...load...estimate if you have enough on hand is enough to justify the bulk purchase. I don't think one should take a life savings or too much of your capital and invest in wire right now but if you have the means you should pick up several spools for the convenience factor alone.
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