Gone to China:(

[lendaddy]

I am not involved in the plating, but I'll mention it to them. I think the ball is already rolling though and they've made an investment in China, we'll see.

The problem is that we cannot really get any smaller, I need more revenue just to maintain the debt service and fixed costs. I was already at my smallest staff in 20 years.

Who knows what business we may find in the short term though, we could get lucky.

[Moneyguy1]

len...

This seems to be endemic throughout the country with small shops. When I read articles of how great the economy is, and talk to small business owners, I get two totally different pictures.

I pray things turn around for you and your employees.

[kach22i]

Tell them you will powder-coat for half of what China will chrome for.

Chrome is out, powder-coat is in.

Good luck with this, I hope you don't become another Michigan Stat.

[lendaddy]

Originally posted by kach22i
Tell them you will powder-coat for half of what China will chrome for.

Chrome is out, powder-coat is in.

Good luck with this, I hope you don't become another Michigan Stat.

There actually are some pretty good looking "chrome" appearing powdercoats out there now, though they are not as durable.

[kach22i]

Originally posted by lendaddy
There actually are some pretty good looking "chrome" appearing powdercoats out there now, though they are not as durable.

Well you did say the virgin steel from China power coats well, just striking out at options.

Maybe if they don't wear as well, there will be a built in replacement market?

Gotta love that aspect of it, right?

[lendaddy]

Originally posted by kach22i
Well you did say the virgin steel from China power coats well, just striking out at options.

Maybe if they don't wear as well, there will be a built in replacement market?

Gotta love that aspect of it, right?

Yea, maybe but it's not my product and there is no way I could bust in as a mfg. Well........................maybe not no way.

[jkarolyi]

Outsourcing always looks good on paper, but the realities of it are much more difficult. Quality control, shipping delays, port strikes, rising costs (yes, China's labor costs are increasing dramatically), differences in business culture, etc. If you go to them with a proposal to match or come close (through powdercoating or whatever) to the outsourcing price, only a fool would choose to deal outside the USA.

[NICKG]

sent you an email Len

[lendaddy]

Originally posted by NICKG
sent you an email Len

Got it and replied, I'm taking care of it tonight or Saturday. Lat time I spoke with Mike he wanted some of our literature and I'll use this opportunity to do so.

Thanks again Nick.

[lendaddy]

Originally posted by jkarolyi
Outsourcing always looks good on paper, but the realities of it are much more difficult. Quality control, shipping delays, port strikes, rising costs (yes, China's labor costs are increasing dramatically), differences in business culture, etc. If you go to them with a proposal to match or come close (through powdercoating or whatever) to the outsourcing price, only a fool would choose to deal outside the USA.

Indeed, we are working on some ideas to save them money here. We have to be careful on this as we know things we're not suppose to know...If you know what I mean.

[NICKG]

Originally posted by lendaddy
Got it and replied, I'm taking care of it tonight or Saturday. Lat time I spoke with Mike he wanted some of our literature and I'll use this opportunity to do so.

Thanks again Nick.

anytime..I also spoke with another guy whose company makes all the big name diesel exhuasts for you..I will speak to another guy this week

[gaijindabe]

High end yacht business is through the roof. (I know this first hand, but I dont own one..) Interesting article. Lots of chrome and other metal work:

THE RISE OF MCYACHTS
For years, the one-upmanship at elite marinas has focused on 400-foot, $200 million-plus floating mansions. Now, thanks in part to a booming charter industry and easier financing, a new class of yachts is growing suprisingly quickly. They are the nautical world's McYachts, luxurious 120- to 200-foot vessels costing anywhere from $13 million to $80 million. With banks using yacht loans to lure high-end clients, the initial cash outlay can be $4 million or less. The new entrants are changing some of the culture of this rarefied world. St. Barts harbormaster Jacques Greux says he's seeing younger owners and more late-night partying. Designers say they're equipping more yachts with gyms, playrooms for kids and technological wizardry such as underwater cameras and theaters for movie screenings. The boats are drawing a new class of owner who aren't Wall Street titans or Silicon Valley billionaires, but include a turkey farmer, coal mine owner, and the head of a billboard company. In 2005, 204 boats 120- to 200-feet long were under construction, up 28% from 2002, while the number of boats 200 feet and bigger was virtually flat in the same period, according to Yachts International Magazine, a publication that caters to owners of large motoryachts and tracks the construction of new boats by polling builders, designers and subcontractors. In all, at least 800 of these boats have been added to the global fleet in the last three years. Demand for these boats has given new life to the U.S. boat-building business. For the McYacht-sized boats, getting into the game doesn't take as big an infusion of cash as a 300-plus footer -- though the operating costs add up. While a 150-foot yacht costs anywhere from $25 million to $50 million, its annual operating costs are at least 10% of the purchase price. Filling up the 10,000-gallon tank of a 150-foot yacht with diesel fuel on Nantucket costs about $37,500. Add to that dock space ($2.50 to $5 a night for every foot of the yacht's length) and crew salaries, which have been rising as the number of very large yachts has expanded. The starting pay for stewards and stewardesses, who clean cabins and serve meals, has gone from $2,000 to $3,000 a month in the last year, according to Diane Byrne, executive editor of Power & Motoryacht. (The Wall Street Journal, 8/12/2006.)

[widebody911]

Originally posted by lendaddy
This was for the trucking industry, the air horns.

Wow, that blows...

(can't believe it took me all day to come up with that)

[jim72911t]

Len, that is really terrible news. I am in manufacturing (15 years), and I'm constantly worried that our business will dry up and leave me looking for a job at Mickey D's. In fact, our largest job shop customer (75% of total job shop revenue) last year decided that they could have their parts made in China as well. It hurt, but fortunately our proprietary parts have been selling really well.

One thing that we have to our advantage is our ability to bring a product to market very quickly. Sure, cheaper copies will come out of China in a couple of years, but by that time we are already on to the next thing. Hopefully your shop can find another (preferably niche) market and head in a slightly different direction. Identify what you do better than any of your competitors, and deliver.

On a related note, I still remember the post about your son, the "machine operator." Seems like he's got a real knack for that sort of thing, and you should be proud.

Best of luck to you, your family, and your business.

Jim