Maybe its just my industry or my shitty suppliers, but there is a very serious malaise going on. Suppliers are lethargic. Service is severely sub-par with lengthy waiting periods for samples, prices, and answers to basic questions. Its like they don't want to do business anymore.
I was just reading somewhere that the massive cost increases in raw materials have not yet really been showing up in consumer prices. I think this may be the cause of the malaise. Who wants to quote for items that won't make any money?
I have been fighting bloody skirmishes with my customers for the past 2 months about pricing. I am seeing some signs of capitulation though...they keep asking me if I should be going to Indonesia or Thailand to source products. I haven't had the heart to tell them that China is the leader - that when China's prices go up, other countries aren't rushing out to quote lower prices, but breaking out the cheap champagne and rejoicing that they might get to survive now that the China Price isn't below raw material cost anymore.
(I could be wrong. Maybe Thailand is cheap. Maybe a long business trip there is in order? I bet I could stay at some nice resort hotel and still get some work done.)
On the other hand, I have been losing a lot of the skirmishing, because some people haven't been passing on their added costs. I think that can't last forever though.
I was just reading somewhere that the massive cost increases in raw materials have not yet really been showing up in consumer prices. I think this may be the cause of the malaise. Who wants to quote for items that won't make any money?
I have been fighting bloody skirmishes with my customers for the past 2 months about pricing. I am seeing some signs of capitulation though...they keep asking me if I should be going to Indonesia or Thailand to source products. I haven't had the heart to tell them that China is the leader - that when China's prices go up, other countries aren't rushing out to quote lower prices, but breaking out the cheap champagne and rejoicing that they might get to survive now that the China Price isn't below raw material cost anymore.
(I could be wrong. Maybe Thailand is cheap. Maybe a long business trip there is in order? I bet I could stay at some nice resort hotel and still get some work done.)
On the other hand, I have been losing a lot of the skirmishing, because some people haven't been passing on their added costs. I think that can't last forever though.
3 comments:
We had to re-quote everything at the end of April. I expect these prices to hit the consumer level in the Fall.
We use primarily steel in our products up to 90% in some cases. We have had to requote everything twice and redesign entire lines.
Ahem. We make wrenches. Don't try to out-steel me. I'm gonna start stealing manhole covers on weekends.
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