glass sales off 20% overall

wrote:
Kalera wrote:

There is something hell of funky going on with Chinese economics. I
just
bought a $6 shovel. The hardware store probably paid about $3.00, and
they most likely bought it from a distributor rather than directly, so

the distributor probably paid $1.50. I am having a hard time
understanding how that shovel got here from China for less than that.
=======

Here's how. You paid $6. The hardware store paid $3 (maybe) If the
distributor paid $1.50 (probably more like $2 as they work on a lower
margin). The Chinese shipped 250,000 shovels over here on one order
which gives them half a million bucks and it probably cost them 50¢ to
make the shovel. Whose making the most money? Oh yeah...when you divide
the shipping between 250,000 shovels it doesn't add but a few cents to
each shovel. Now, rakes are another story......(BAG)

Here's the part that's really got me. A decent per-ton shipping price is
just under $200 for something really compact and heavy (glass, tile,
etc). It's more for less compact items, such as, say, shovels, but I'm
not sure how much more so I will go with $200/ton. The shovel weighs
about 4 lbs. That's 500 shovels per ton, at .40 a shovel. I haven't even
tried to figure out how import tariffs, small as they are, figure into
this equation.

The raw materials that go into making a shovel are worth more than .50 US.
--
-Kalera
http://www.beadwife.com
http://www.bridgetownglass.com
On eBay: http://www.snurl.com/1sfe

In , on Fri, 14 Jul 2006
10:34:24 -0700, Kalera wrote:

There is something hell of funky going on with Chinese economics. I just
bought a $6 shovel. The hardware store probably paid about $3.00, and
they most likely bought it from a distributor rather than directly, so
the distributor probably paid $1.50. I am having a hard time
understanding how that shovel got here from China for less than that.

Low wages + Chinese gov't fixed exchange rate.

If the Yuan was traded on the open market (as is
just about every other currency in the world), prices
of Chinese goods would go up. As it is, the Chinese
gov't keeps the value artificially low at ~8 Yuan to
the dollar.

Steve Ackman wrote:
In , on Fri, 14 Jul 2006
10:34:24 -0700, Kalera wrote:

There is something hell of funky going on with Chinese economics. I just
bought a $6 shovel. The hardware store probably paid about $3.00, and
they most likely bought it from a distributor rather than directly, so
the distributor probably paid $1.50. I am having a hard time
understanding how that shovel got here from China for less than that.

Low wages + Chinese gov't fixed exchange rate.

If the Yuan was traded on the open market (as is
just about every other currency in the world), prices
of Chinese goods would go up. As it is, the Chinese
gov't keeps the value artificially low at ~8 Yuan to
the dollar.

That's fishy in itself, but I also just don't understand it when I can
buy finished goods for less than the cost of materials. One example is
seeing lampwork beads at shows, purportedly (and to my eye,
legitimately) made with Bullseye glass but selling for less than
Bullseye rods sell for per pound, wholesale.

Mysterious.

--
-Kalera
http://www.beadwife.com
http://www.bridgetownglass.com
On eBay: http://www.snurl.com/1sfe

Kalera wrote:

That's fishy in itself, but I also just don't understand it when I can
buy finished goods for less than the cost of materials. One example is
seeing lampwork beads at shows, purportedly (and to my eye,
legitimately) made with Bullseye glass but selling for less than
Bullseye rods sell for per pound, wholesale.

Mysterious.

There are many levels of wholesale. If you qualify to by wholesale from
a distributor or eve direct from BE and you order say 20 lbs of rods
and you pay X. Then there's the guy in China (and he doesn't have to be
from China) who orders 20 tons of BE...do you think he's paying X? Not
likely. As smart as the Chinese are, it wouldn't take them long to make
rods that look just like BE and have the same COE. Heck, they're making
Armstrong glass and you couldn't tell the difference from whether it
was made here or there. As for the cost of materials like the shovel,
with the number of handles you could get out of a long you could safely
assume that the handle cost maybe 10 cents. The blade, which is nothing
more than recycled steel is poured into molds and they probably poor
1000 at a time. So, you end up with maybe 20 cents in the blade. Labor
could be something like 25 cents or less per shovel. Now were backe to
where the shovel costs about 50 cents to make. Look at a 2 x4...stud
grade maybe costing $1.50 - $3 depending on where you buy it. Kinda
makes you wonder how they can make it for that but they do and they
make a profit. And...I'm not even going to get into the rakes.

wrote:
Kalera wrote:

That's fishy in itself, but I also just don't understand it when I can
buy finished goods for less than the cost of materials. One example is
seeing lampwork beads at shows, purportedly (and to my eye,
legitimately) made with Bullseye glass but selling for less than
Bullseye rods sell for per pound, wholesale.

Mysterious.

There are many levels of wholesale. If you qualify to by wholesale from
a distributor or eve direct from BE and you order say 20 lbs of rods
and you pay X. Then there's the guy in China (and he doesn't have to be
from China) who orders 20 tons of BE...do you think he's paying X? Not
likely. As smart as the Chinese are, it wouldn't take them long to make
rods that look just like BE and have the same COE. Heck, they're making
Armstrong glass and you couldn't tell the difference from whether it
was made here or there. As for the cost of materials like the shovel,
with the number of handles you could get out of a long you could safely
assume that the handle cost maybe 10 cents. The blade, which is nothing
more than recycled steel is poured into molds and they probably poor
1000 at a time. So, you end up with maybe 20 cents in the blade. Labor
could be something like 25 cents or less per shovel. Now were backe to
where the shovel costs about 50 cents to make. Look at a 2 x4...stud
grade maybe costing $1.50 - $3 depending on where you buy it. Kinda
makes you wonder how they can make it for that but they do and they
make a profit. And...I'm not even going to get into the rakes.


I'm pretty familiar with Bullseye's wholesale schedule...

I can certainly imagine the Chinese making a reasonable facsimile of
some Bullseye glass colors, (others are so tricky that even Uroboros
hasn't figured them out) but they seem to have a *really* hard time
getting the COE consistent. That's one of the reasons, as I understand
it, that most of the Chinese bead factories use Kinari glass from Japan.

The steel in the shovel is stamped rather than cast, so I may grant you
that... I'm a wee bit skeptical.
--
-Kalera
http://www.beadwife.com
http://www.bridgetownglass.com
On eBay: http://www.snurl.com/1sfe

wrote in message
oups.com...
There are many levels of wholesale. If you qualify to by wholesale from
a distributor or eve direct from BE and you order say 20 lbs of rods
and you pay X. Then there's the guy in China (and he doesn't have to be
from China) who orders 20 tons of BE...do you think he's paying X? Not
likely.

Hi, Scratch.

In another life, back in the last century, I owned a professional photo
finishing lab. I bought Kodak color paper at the published pro lab catalog
price. My competitors allegedly bought the paper at the same price. Kodak
swore up and down that there was one price, every one paid the same price,
no quantity discounts were available. As I recall, I was paying about
$0.43 per square foot, meaning an 8x10 cost me about 24 cents for the
paper. I availed myself of an opportunity to get out of that entrepreneural
rat-race after about 20 years, and after a few months off, decided to do
some quality control consulting at one of the nation's largest school
picture labs, in Eastern Tenn. It didn't take me long to find out that the
lab where I was now consulting had been buying paper from Kodak for years
for about 18-20 cents per square foot. ( Less than 1/2 of the published
prices.) And on top of that, I learned that Kodak had a well-hidden
financial interest in that lab, to the tune of about $9-11MM. Most of the
production people there had NO idea.

At the same time I owned the color lab, I also had a retail camera store.
The K-Mart acrosss the street was selling Canon AE-1's for $30 less than
what I was paying dealer wholesale for the same product. The Canon rep
swore up and down that they weren't selling to K-Mart for any less than what
I was paying, that it was a loss leader.

Yeah, right.

Then, after more complaints about give-away pricing by K-Mart, the Canon
rep told me the K-Mart merchandise was "grey market", meaning that they
didn't have a US warranty. I started going to K-Mart a couple of times a
week, buying 2 and 3 cameras at a time, taking them back across the street
to my retail store, selling them at my regular price and increasing my
profit. The Canon rep got ****ed because I wasn't buying cameras from him
in my usual 18-24 units a month. They threatened to cancel my dealership
because I was selling "grey market", until I showed him the USA warranty
cards in the boxes from across the street. I suggested strongly that if
they were to cancel my dealership, I was going to sue them for price fixing
and restraint of trade. A week or so later, I "magically" got a 5 figure
"rebate" check from Canon, USA. It seems, somehow, that they had
"forgotten" that my annual volume of purchases had entitled me to some
non-published mega-dealer discount. Ummmhuh.

It wouldn't surprise me a bit to learn that BE has a financial interest in
an offshore bead manufacturing facility. What better way to have a
consistent, constant demand for raw products? What better way to smooth out
the glass production problems and inventory imbalances than to have a
guaranteed customer that will take whatever you send them color and
quality-wise?

And, of course, if they were to somehow step on the toes of some nitwit,
no-talent beadmaker in the USA, oh, well. BFD, there's another one to take
her place. And, Brady will be spitting out more "artisans" from his
circle-jerk festival in a few weeks. There's always somebody to take
advantage of, some how, some way.

Now, I'm NOT accusing BE of anything. I don't know anything about them,
and have no particular interest in anything they make. I'm just relating
what happened to me dealing with two companies in another entirely different
industry.

The point is, not every supplier has their customer's interests at heart.

wrote:

There are some wholesale schedules only certain eyes get to see.
Stamped or molded steel...doesn't matter.

It certainly does matter if you're paying the production costs. Shovels
are stamped.

--
Jack

wrote in message
oups.com...
Kalera wrote:

There is something hell of funky going on with Chinese economics. I
just
bought a $6 shovel. The hardware store probably paid about $3.00, and
they most likely bought it from a distributor rather than directly, so

the distributor probably paid $1.50. I am having a hard time
understanding how that shovel got here from China for less than that.


My latest amazing "how do they do it" story is these .99 cent stores
opening up all over the place. They take over 2 or 3 strip mall stores and
stock thousands of everyday items all for the same .99 cents. Hardware,
cleaning supplies, tools, canned food, sundries, electrical, soap, shampoo,
computer cables, you name it. Most are name brands and the parts are all
carded and shrink wrapped. Sure the quality is low end, but basically the
stuff all works fine. How much are they paying for each, how much is the
disty paying? Who owns all these places? I see Asians & Indians mostly. It's
incredible how busy they are all day and night. You can't walk out without
filling up a bag of stuff. They underprice Radio Shack, Supermarkets,
Costco,Wallmart, even the flea markets by at least 50%.


--
JK Sinrod
www.SinrodStudios.com
www.MyConeyIslandMemories.com

glassman wrote:
wrote in message
oups.com...
Kalera wrote:

There is something hell of funky going on with Chinese economics. I
just
bought a $6 shovel. The hardware store probably paid about $3.00, and
they most likely bought it from a distributor rather than directly, so

the distributor probably paid $1.50. I am having a hard time
understanding how that shovel got here from China for less than that.


My latest amazing "how do they do it" story is these .99 cent stores
opening up all over the place. They take over 2 or 3 strip mall stores and
stock thousands of everyday items all for the same .99 cents. Hardware,
cleaning supplies, tools, canned food, sundries, electrical, soap, shampoo,
computer cables, you name it. Most are name brands and the parts are all
carded and shrink wrapped. Sure the quality is low end, but basically the
stuff all works fine. How much are they paying for each, how much is the
disty paying? Who owns all these places? I see Asians & Indians mostly. It's
incredible how busy they are all day and night. You can't walk out without
filling up a bag of stuff. They underprice Radio Shack, Supermarkets,
Costco,Wallmart, even the flea markets by at least 50%.

Here are two observations I've made about these places;

1. A lot of the stuff is "surplus" so the distributor sold it at no
profit or even at a loss just to get it the hell out of their warehouse.

2. A lot of the other stuff is either reasonably priced or overpriced
for what it is.


--
-Kalera
http://www.beadwife.com
http://www.bridgetownglass.com
On eBay: http://www.snurl.com/1sfe

wrote:
There are some wholesale schedules only certain eyes get to see.

I worked for Bullseye. When I say I'm familiar with their wholesale
schedules, I mean I'm intimately familiar with their wholesale schedules.

Stamped or molded steel...doesn't matter.

Stamped is cheaper, actually, which is why I was conceding that one.

Fact, the Chinese have some of the most advanced factories in the word,
dedicated workers...contrary to popular belief not everything made in
China is by slave labor. In fact, very few things are. Funny how a lot
of people think that the factory worker is being paid so called slave
wages when in fact they are not...they're not getting rich by any means
but most make a decent wage for thier economic enviroment. But, that's
here nor there other than they are very hard workers and can produce
more shovels than any American can factory can. Maybe not the best but
certainly not the worst.

I know. But the economics of it are still sketchy, to say the least.
Personally, I suspect government subsidies as part of a long-term
national economic plan which aims to corner the world market on
manufactured consumer goods.

If I'm right, prices on Chinese goods will increase dramatically in a
few years.
--
-Kalera
http://www.beadwife.com
http://www.bridgetownglass.com
On eBay: http://www.snurl.com/1sfe