Good friend closing business after 28 years.

[saveliberty]

Landscaping has had the low price problem a long time. The answer is to do one or more of the following:

Diversify
Appeal to the high end customer with product and service.
Make the quality difference obvious
Educate your customers to the total cost of ownership
Better customer service

Getting into the low cost battle, when that is not your strength is a losing proposition.

It isn't a comdemnation of anyone just something to consider and understand.

 

[KevinWestern]

Hate to see this. A good friend and colleague bought a business in 1984 that had been in existence since 1952. Between 1984 to 2000 he nearly tripled the business. His revenue last year was half what it was pre-recession.
In February he lost another large account...he can no longer survive.
I talked to him for a good 45 minutes this morning. His words hit home for me, and I bet a lot of you...

"I am so very disappointed in the direction this country has been going for the past 10-15years. For 16 years I provided great service and a consistent product that other businesses needed - and the orders just kept coming in. I would say 80% never even asked a price, they knew we took care of them and that my pricing was fair. In the past 12 years or so little by little it reached the point to where it is today - every single order people want the price up front so they can compare your price to someone else. They call back and ask if we can match a price they got from so and so, they call to see if I can do the job faster at the same time can I work with them on the price? There is no such thing as a fair price anymore. There is only the lowest price. I just can't do it anymore. I am sick to death of this "kill or be killed" environment where the only way you get new business is if you undercut someone else while they are trying to undercut you - all to try and satisfy a client base whose only concern is the price."

Very sad to hear.

With the internet becoming “our world” for many of us, I think we are continually becoming less and less involved with (and concerned about) the physical local community around us. Why go to the local store to buy a coffee maker when I can just search Target.com and find the same thing for 20% cheaper and have it shipped straight to my home?

Now, there are many benefits to this large scale interconnected “global economy” – namely lower prices, greater efficiency – but sometimes there are additional “costs” to a product than just the dollar amount on the price tag - the intangible costs we pay for these lower prices.

Personally, I'd rather live in a world of 300 vendors selling an item at $4, vs a world with 3 vendors selling an item at $3.50.
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[Foxfyre]

Hate to see this. A good friend and colleague bought a business in 1984 that had been in existence since 1952. Between 1984 to 2000 he nearly tripled the business. His revenue last year was half what it was pre-recession.
In February he lost another large account...he can no longer survive.
I talked to him for a good 45 minutes this morning. His words hit home for me, and I bet a lot of you...

"I am so very disappointed in the direction this country has been going for the past 10-15years. For 16 years I provided great service and a consistent product that other businesses needed - and the orders just kept coming in. I would say 80% never even asked a price, they knew we took care of them and that my pricing was fair. In the past 12 years or so little by little it reached the point to where it is today - every single order people want the price up front so they can compare your price to someone else. They call back and ask if we can match a price they got from so and so, they call to see if I can do the job faster at the same time can I work with them on the price? There is no such thing as a fair price anymore. There is only the lowest price. I just can't do it anymore. I am sick to death of this "kill or be killed" environment where the only way you get new business is if you undercut someone else while they are trying to undercut you - all to try and satisfy a client base whose only concern is the price."

Very sad to hear.

With the internet becoming “our world” for many of us, I think we are continually becoming less and less involved with (and concerned about) the physical local community around us. Why go to the local store to buy a coffee maker when I can just search Target.com and find the same thing for 20% cheaper and have it shipped straight to my home?

Now, there are many benefits to this large scale interconnected “global economy” – namely lower prices, greater efficiency – but sometimes there are additional “costs” to a product than just the dollar amount on the price tag - the intangible costs we pay for these lower prices.

Personally, I'd rather live in a world of 300 vendors selling an item at $4, vs a world with 3 vendors selling an item at $3.50.
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.
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It usually doesn't work that way though. You are more likely to have 3 vendors selling an item at $7.00 versus 300 vendors selling an item at $3.50. The more competition there is the more beneficial to the buyer. And you won't have 300 vendors selling an item at $3.50 unless they are making a profit at that amount.

There are unfortunate circumstances that no amount of business expertise can overcome., It is the rare small grocery store or mom and pop office supply or corner hardware store that can compete against the big box stores. They simply won't have the volume to compete with the prices in large markets and as the big box stores come in, most of the small businesses close down. There's not much anybody can do when the customer is willing to give up the personal touch and convenience in favor of larger variety and better prices.

But in a few cases where they provide special convenience, and also in the small town or rural market, the mom and pop vendors still thrive.

But all of us have to adapt and adjust and go with the ebb and flow of constantly changing markets.

And all of us will not have nearly as much fun or satisfaction working in a difficult economy as we have when the economy is good.

 

[Avorysuds]

We are the ocuntry of lowest prices to maximize profits.
Which means lower salaries, more chinese imports and less American jobs.
Which is a long term downward spiral for the USA.

Wrrooooong.

 

[KevinWestern]

It usually doesn't work that way though. You are more likely to have 3 vendors selling an item at $7.00 versus 300 vendors selling an item at $3.50. The more competition there is the more beneficial to the buyer. And you won't have 300 vendors selling an item at $3.50 unless they are making a profit at that amount.

I don't think I agree with you on this. Perhaps if there was the case of a monopoly, the price might be higher than the 300 vendors, but as long as there's two or three HUGE companies competing against each other, you can be sure that the price is going to be driven down to just about as low as it can possibly be.

Think about it. Say Walmart is selecting either Vendor A or Vendor B (both are wholly independent of each other) to provide them with product X to stock in their 600+ stores nationwide (which is a HUGE amount of business).

Do you think that those two companies are going to mess around with high prices, or instead try to offer the lowest imaginable price to Walmart?

I think they're going to opt to try and offer the lowest possible price...

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[Avorysuds]

Landscaping has had the low price problem a long time. The answer is to do one or more of the following:

Diversify
Appeal to the high end customer with product and service.
Make the quality difference obvious
Educate your customers to the total cost of ownership
Better customer service

Getting into the low cost battle, when that is not your strength is a losing proposition.

It isn't a comdemnation of anyone just something to consider and understand.

Correct.

Some things there will be very little profit in doing, so having other countries make stuff and sell it to us for near nothing is great for the US. Many industries have an advantage by being local, or even just being in the US, an advantage another country simply can't even participate in. Stop trying to sell things that are dated and focus on what is more permeate.

For instance, why open a Video/DVD rental store when we have things like Netflix taking over… However try and play indoor soccer in china when you live in California…

 

[geauxtohell]

Out of business. He does not want to stay in the industry, unsure of what he will do going forward.
Lowering labor cost has been what businesses everywhere have done for the past 25 years tying to satisfy a consumer base that only cares about a cheaper price. In practically every product you buy there will be at least a part of it made with near-slave labor. That is the result when the price is the only concern people have.
People could care less if the clothes they wear or the vacuum cleaner they use or the television they watch was made by extraordinarily poor people living and working in unbelievable conditions...no one cares as long as they can incubate themselves from it by not thinking about it.

Not to be an ass, but being forced out because the customer is seeking lower prices elsewhere just sounds like capitalism.

On the other hand, if he's trying to compete with foreign labor, he is at an unfair disadvantage that no one seems willing to do anything about.

Call it "uber capitalism"...another word is "Walmartization".
Changing providers or suppliers over price is obviously nothing new. That is what competition in a free market is all about. However in the past 15 years or so this has gone to a whole new level. I have been in business for 24 years I can tell you for myself and the plethora of other businesses I know - price is everything today. I would say in the 1990's about 70% of our orders came in without an estimate request. Today almost zero. People go online and check your price against anybody they can find, everything - EVERYTHING is about how low can they pay for it.

Again, I know that is bad for your business, but isn't that what capitalism is all about?

 

[ABikerSailor]

We are the ocuntry of lowest prices to maximize profits.
Which means lower salaries, more chinese imports and less American jobs.
Which is a long term downward spiral for the USA.

Yeah............just look at Apple and the way they do things. ALL of the manufacturing is done in China under pretty dark conditions.......long hours, little pay, etc.

The jobs that Apple has here in the US? Sales jobs only.

 

[Skull Pilot]

Out of business. He does not want to stay in the industry, unsure of what he will do going forward.
Lowering labor cost has been what businesses everywhere have done for the past 25 years tying to satisfy a consumer base that only cares about a cheaper price. In practically every product you buy there will be at least a part of it made with near-slave labor. That is the result when the price is the only concern people have.
People could care less if the clothes they wear or the vacuum cleaner they use or the television they watch was made by extraordinarily poor people living and working in unbelievable conditions...no one cares as long as they can incubate themselves from it by not thinking about it.

Not to be an ass, but being forced out because the customer is seeking lower prices elsewhere just sounds like capitalism.

On the other hand, if he's trying to compete with foreign labor, he is at an unfair disadvantage that no one seems willing to do anything about.

Call it "uber capitalism"...another word is "Walmartization".
Changing providers or suppliers over price is obviously nothing new. That is what competition in a free market is all about. However in the past 15 years or so this has gone to a whole new level. I have been in business for 24 years I can tell you for myself and the plethora of other businesses I know - price is everything today. I would say in the 1990's about 70% of our orders came in without an estimate request. Today almost zero. People go online and check your price against anybody they can find, everything - EVERYTHING is about how low can they pay for it.

I've always been like that.

I never buy anything without 3 estimates. I don't always buy product or service with the lowest price but price is always a concern as it should be.

 

[Avorysuds]

We are the ocuntry of lowest prices to maximize profits.
Which means lower salaries, more chinese imports and less American jobs.
Which is a long term downward spiral for the USA.

Yeah............just look at Apple and the way they do things. ALL of the manufacturing is done in China under pretty dark conditions.......long hours, little pay, etc.

The jobs that Apple has here in the US? Sales jobs only.

Correct, but look at what you can buy because of that. Now the first thing someone would say it "but if I can't afford it because of my shitty job!!!!" Well, you almost have a point, if you think this... But reality is did you really want to be doing the wonderful job of assembling IPods? No... But you can do thousands of amazing other things right here in the US that can't be outsourced.

Point is, focus on more permanent local jobs than how a company in India can sell more keyboards than you. Let them do the menial jobs making plastic crap so you can focus on the bigger picture.

 

[ABikerSailor]

You know...........bicycle parts are EXPENSIVE if you ride a good to excellent quality racing machine, and yeah, prices are cheaper online than they are in a store, but my rule of thumb was that if I had a bike shop that I liked, if they were 10 - 15 percent over, I'd go buy stuff from them. Why? Simple, if something went wrong with my bike, because of my customer support, I got better service when it needed fixed.

Yes, low price counts (especially in this economy), but if you're able to, support your local shops where possible, because that is what really stimulates the economy.

And, you know, after reading this thread, I think that the 1 percent and the corporations should have all their loopholes closed, thereby setting the government up to allow tax cuts for the poor and middle class.

After all.............there are more of the poor and middle class than there are the rich. Rich people buy stuff, but it's not near as much as what the rest of us do. Wanna stimulate the economy? Give tax breaks to the middle and poor, because that will do more than anything. Imagine if both you and ALL the people in your town had an extra 40 bucks/month, because that is what will help solve some of these problems, because people will be able to buy stuff again.

Matter of fact, I recently finished paying my last child support payment, leaving me with an extra 240/month, and lemmie tell ya...........I've been stimulating the hell out of the economy with new shoes, new tires for the bike, and a lot of other stuff as well.

 

[sparky]

You folks that advocated free trade under the guise of normal capitalism might want to rethink your stance

~S~

 

[iamwhatiseem]

Not to be an ass, but being forced out because the customer is seeking lower prices elsewhere just sounds like capitalism.

On the other hand, if he's trying to compete with foreign labor, he is at an unfair disadvantage that no one seems willing to do anything about.

Call it "uber capitalism"...another word is "Walmartization".
Changing providers or suppliers over price is obviously nothing new. That is what competition in a free market is all about. However in the past 15 years or so this has gone to a whole new level. I have been in business for 24 years I can tell you for myself and the plethora of other businesses I know - price is everything today. I would say in the 1990's about 70% of our orders came in without an estimate request. Today almost zero. People go online and check your price against anybody they can find, everything - EVERYTHING is about how low can they pay for it.

Again, I know that is bad for your business, but isn't that what capitalism is all about?

No. That is what blindness is all about.
The most important thing a person does as a citizen of this country is how they spend their money. How you spend your money will either be a benefit to society or detrimental. There is no in between.
A good capitalist recognises that there is always an end game.
We are at a crossroads in this country and only a few can see it.
Our entire financial system is corrupt to the core. Special interest both own and manage at least two branches of our government, including this President.
Our livelihood is going in the wrong direction. Slowly upper-middle class is becoming what middle class once was, and middle class is becoming lower middle class.
This is the high cost of a low price that is below sustainability. The only reason prices are what they are is because we no longer care that slave labor, half starved and forced labor is what it takes. And we welcome it as long as we don't see it.
I too am very disappointed in our nation.

 

[saveliberty]

You know...........bicycle parts are EXPENSIVE if you ride a good to excellent quality racing machine, and yeah, prices are cheaper online than they are in a store, but my rule of thumb was that if I had a bike shop that I liked, if they were 10 - 15 percent over, I'd go buy stuff from them. Why? Simple, if something went wrong with my bike, because of my customer support, I got better service when it needed fixed.

Yes, low price counts (especially in this economy), but if you're able to, support your local shops where possible, because that is what really stimulates the economy.

And, you know, after reading this thread, I think that the 1 percent and the corporations should have all their loopholes closed, thereby setting the government up to allow tax cuts for the poor and middle class.

After all.............there are more of the poor and middle class than there are the rich. Rich people buy stuff, but it's not near as much as what the rest of us do. Wanna stimulate the economy? Give tax breaks to the middle and poor, because that will do more than anything. Imagine if both you and ALL the people in your town had an extra 40 bucks/month, because that is what will help solve some of these problems, because people will be able to buy stuff again.

Matter of fact, I recently finished paying my last child support payment, leaving me with an extra 240/month, and lemmie tell ya...........I've been stimulating the hell out of the economy with new shoes, new tires for the bike, and a lot of other stuff as well.

The general rule of thumb is a dollar spent locally circulates five to seven times within the region before leaving. That is a big impact for a local economy. ABS makes an excellent point of the 10-15% difference being a reasonable tradeoff.

 

[Unkotare]

Hate to see this. A good friend and colleague bought a business in 1984 that had been in existence since 1952. Between 1984 to 2000 he nearly tripled the business. His revenue last year was half what it was pre-recession.
In February he lost another large account...he can no longer survive.
I talked to him for a good 45 minutes this morning. His words hit home for me, and I bet a lot of you...

"I am so very disappointed in the direction this country has been going for the past 10-15years. For 16 years I provided great service and a consistent product that other businesses needed - and the orders just kept coming in. I would say 80% never even asked a price, they knew we took care of them and that my pricing was fair. In the past 12 years or so little by little it reached the point to where it is today - every single order people want the price up front so they can compare your price to someone else. They call back and ask if we can match a price they got from so and so, they call to see if I can do the job faster at the same time can I work with them on the price? There is no such thing as a fair price anymore. There is only the lowest price. I just can't do it anymore. I am sick to death of this "kill or be killed" environment where the only way you get new business is if you undercut someone else while they are trying to undercut you - all to try and satisfy a client base whose only concern is the price."

Sounds like your friend didn't like competition. It's hard to believe someone had been in business that long and was still so unrealistic. Hmmm...

 

[Unkotare]

Call it "uber capitalism"...another word is "Walmartization".
Changing providers or suppliers over price is obviously nothing new. That is what competition in a free market is all about. However in the past 15 years or so this has gone to a whole new level. I have been in business for 24 years I can tell you for myself and the plethora of other businesses I know - price is everything today. I would say in the 1990's about 70% of our orders came in without an estimate request. Today almost zero. People go online and check your price against anybody they can find, everything - EVERYTHING is about how low can they pay for it.

Again, I know that is bad for your business, but isn't that what capitalism is all about?

No. That is what blindness is all about.
The most important thing a person does as a citizen of this country is how they spend their money. How you spend your money will either be a benefit to society or detrimental. There is no in between.
A good capitalist recognises that there is always an end game.
We are at a crossroads in this country and only a few can see it.
Our entire financial system is corrupt to the core. Special interest both own and manage at least two branches of our government, including this President.
Our livelihood is going in the wrong direction. Slowly upper-middle class is becoming what middle class once was, and middle class is becoming lower middle class.
This is the high cost of a low price that is below sustainability. The only reason prices are what they are is because we no longer care that slave labor, half starved and forced labor is what it takes. And we welcome it as long as we don't see it.
I too am very disappointed in our nation.

Sounds like you want to do business in Fantasyland. It also sounds like you cooked up this whole story to promote your looney-lefty political/emotional views.

 

[KevinWestern]

Hate to see this. A good friend and colleague bought a business in 1984 that had been in existence since 1952. Between 1984 to 2000 he nearly tripled the business. His revenue last year was half what it was pre-recession.
In February he lost another large account...he can no longer survive.
I talked to him for a good 45 minutes this morning. His words hit home for me, and I bet a lot of you...

"I am so very disappointed in the direction this country has been going for the past 10-15years. For 16 years I provided great service and a consistent product that other businesses needed - and the orders just kept coming in. I would say 80% never even asked a price, they knew we took care of them and that my pricing was fair. In the past 12 years or so little by little it reached the point to where it is today - every single order people want the price up front so they can compare your price to someone else. They call back and ask if we can match a price they got from so and so, they call to see if I can do the job faster at the same time can I work with them on the price? There is no such thing as a fair price anymore. There is only the lowest price. I just can't do it anymore. I am sick to death of this "kill or be killed" environment where the only way you get new business is if you undercut someone else while they are trying to undercut you - all to try and satisfy a client base whose only concern is the price."

Sounds like your friend didn't like competition. It's hard to believe someone had been in business that long and was still so unrealistic. Hmmm...

Unkotare, with all due respect, your inability to see the big picture, or think beyond the simplest surface level of every issue never ceases to amaze me.

I don't think the friend had a problem with competition, the friend had a problem with a world who's sole concern is continually becoming ONLY the transactional price point, and nothing beyond that.

As I mentioned, what many consumers don't realize is that there are intangible and hidden costs that accompany many of the low prices we see in the modern marketplace today. Want to buy cheap food? Well perhaps it costs you less now, but down the road those pesticides that made the plants easier to grow (and hence cheaper) will end up giving you cancer. Want to buy a cheap shirt from Walmart? Great, but just realize that the reason the shirt is so cheap is because some kids in Indonesia working 16 hour days got paid only $0.03 for the shift.

We need to realize that the "price" of things goes beyond simply what it costs you (in dollars) during the time of the transaction.

Iamwhatiseem raised an excellent point, which was in order for capitalism to succeed in the long run, we need good, educated consumers who can make wise decisions when it comes to the products they buy and the companies they support.

If consumers start to only take into consideration the tag price and nothing else, there's a chance that they may end up paying some pretty hefty hidden costs in the long run.

This post is simply encouraging people to think a little bit. I suggest you try for once...

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[KevinWestern]

Again, I know that is bad for your business, but isn't that what capitalism is all about?

No. That is what blindness is all about.
The most important thing a person does as a citizen of this country is how they spend their money. How you spend your money will either be a benefit to society or detrimental. There is no in between.
A good capitalist recognises that there is always an end game.
We are at a crossroads in this country and only a few can see it.
Our entire financial system is corrupt to the core. Special interest both own and manage at least two branches of our government, including this President.
Our livelihood is going in the wrong direction. Slowly upper-middle class is becoming what middle class once was, and middle class is becoming lower middle class.
This is the high cost of a low price that is below sustainability. The only reason prices are what they are is because we no longer care that slave labor, half starved and forced labor is what it takes. And we welcome it as long as we don't see it.
I too am very disappointed in our nation.

Sounds like you want to do business in Fantasyland. It also sounds like you cooked up this whole story to promote your looney-lefty political/emotional views.

Unk, I'll say this nicely.

Anyone can post one-liner insults, but it takes intelligence and brainpower to post a calm, meaningful response that provokes thought within a given conversation.

Just think about that for a second or two......

 

[Unkotare]

Unkotare, with all due respect, your inability to see the big picture, or think beyond the simplest surface level of every issue never ceases to amaze me.

You mean I don't agree with your emo lefty bullshit? You mean I live in the real world? Yeah, I know.

 

[Douger]

Lower wages. This has been the go-to solution to a price-crazed population for the past 20 years.
If you ask any previous grocery owner 30 years ago - what could you have done to stay in business? Everyone of them would say the same thing - nothing. They could not compete with big box stores with their price leverage abilities and logistics.

So lower the minimum wage?

Did your friend go out of business or did he just decide to close shop?

I couldn't discern that from the post.

Out of business. He does not want to stay in the industry, unsure of what he will do going forward.
Lowering labor cost has been what businesses everywhere have done for the past 25 years tying to satisfy a consumer base that only cares about a cheaper price. In practically every product you buy there will be at least a part of it made with near-slave labor. That is the result when the price is the only concern people have.
People could care less if the clothes they wear or the vacuum cleaner they use or the television they watch was made by extraordinarily poor people living and working in unbelievable conditions...no one cares as long as they can incubate themselves from it by not thinking about it.

He could do as your masters wish and seek an illustrious career at Office Despot re-filling ink cartridges !
Read my signature.

The girl in our town opened up shop in 2005.Printing, embroidery, rebinding books, sales and repair of printer faxes. all in about 600 square feet. She does very well..... because there isn't any big box operations to compete with.Office depot could try but nobody would walk in their door.