The REAL reason for dropping prices?

[nevohraalnavnoj]

If demand was going up and up as you say, and the supply was still limited as a result of them laying small clutches and being picky breeders, Economics 101 tells you that the prices would absolutely not decrease.

There absolutely is such a thing as a back door deal. When advertised prices are always 50-100% higher than what they are actually selling for, speculation starts to become a huge factor in what happens to the price. All of those back door deals got around and everyone began to think, "well, if I just wait a year, I can buy it for half." With everyone thinking that and no one buying, its almost a self-fulfilling prophecy because that causes the demand to decrease, with the prices following right behind it.

Think about it, why should I buy a pied now for 2500 when I can wait 2 years or so when they are at or under 1000? Those kinds of statements get into everyone's heads and that kind of speculation truly does affect the market.

I believe that demand is going up, and prices are staying the same if not going up...but that price structure shifts over the morphs. MEANING, a pastel may have been $1000 two years ago and now is relatively inexpensive, but the butter, for example, has now filled that spot.

The car market would be a rough analogy. Say a 2005 XYZ is now only worth $2000 when it used to be worth $18,000. But the new 2009 XYZ is worth $18,000 or more. So the price of that particular car (morph) has dropped but it's not like the bottom has fallen out of the market.

Why should you buy a pied now vs two years? Because your breeding program will be two years ahead. If you just want it for enjoyment, that's a different deal.

JonV

[nevohraalnavnoj]

Yeah but over time the prices of stocks tend to increase where as ball pythons tend to decrease. A stock could decrease too, but in the long run the market tends to increase.

I think these are different animals. Stocks don't reproduce, unless you consider paying dividends as reproduction, and even then it's too slow of a rate to make a good analogy.

Imagine your pastel female is $400 when you buy her, now worth $200. But you end up selling some babies and come out say $400 ahead. Then really her value has increased because she's paid you a $400 dividend.

JonV

[Gloryhound]

I think these are different animals. Stocks don't reproduce, unless you consider paying dividends as reproduction, and even then it's too slow of a rate to make a good analogy.

Imagine your pastel female is $400 when you buy her, now worth $200. But you end up selling some babies and come out say $400 ahead. Then really her value has increased because she's paid you a $400 dividend.

JonV

The stock market dividend yield is a decent analogy, but with ball pythons you have to remember you are constantly paying into them. If you buy your food directly you pay for it and that cost has to go into the snake. Also if you breed your own feeders the cost of breeding them has to be added in plus the time spent. The you throw in the energy needed for keeping them as well. Plus you have to throw in the second "stock" you had to buy. (The male as it takes 2 to tango.) Also you have the cost of the incubator and housing structures which can be spread out over several females or several years of breeding.

In the end if you are hobby breeding the best you can hope for is selling to help supply your addiction. If you are looking at making it a business you have to create and balance a business plan. You are probably looking at 3 years as a minimum to make the business self sufficient and 5 years minimum before you actually see a profit. A lot of this also depends on up front investment. If you invest 5 grand in start up it will take longer to recover than if you invest 20 grand as the cost of incidentals will be spread out over more ball pythons. Also though you are exposing yourself to more risk though.

Also I don't imagine it would be easy to get a loan for this kind of business until you have actually hit the point that your balance sheet is showing a profit for a couple years in a row at which point I'm not sure if a loan is really something you would want to mess with as the interest will cut into your profit pretty hard!

[muddoc]

If you are looking at making it a business you have to create and balance a business plan. You are probably looking at 3 years as a minimum to make the business self sufficient and 5 years minimum before you actually see a profit. A lot of this also depends on up front investment.

You hit that spot on for us. I thought you were spying into our books. Those numbers represent almost exactly how the business has worked for us. However, it might even be the 6 year mark before we really turn a profit, as I still have one big expense that I am hoping to overcome this year (a new building).

[nevohraalnavnoj]

What do you guys think is the proper balance for a new breeder between the co doms and the recessives? I think a lot of people jump too heavily into the co-doms and are then floored when the bottom falls really fast. I put more money into my pied/albino and soon clown projects, but realize this going to take a lot longer to return any of my investment.

Any thoughts???

Thanks!

JonV

[nevohraalnavnoj]

You hit that spot on for us. I thought you were spying into our books. Those numbers represent almost exactly how the business has worked for us. However, it might even be the 6 year mark before we really turn a profit, as I still have one big expense that I am hoping to overcome this year (a new building).

A dedicated building....sweeet! At what point do you have to decide to hire an employee? Is there a magic number (over 60 bps?) etc...?

Are you still doing it all yourself, Tim??

JonV

[Gloryhound]

You hit that spot on for us. I thought you were spying into our books. Those numbers represent almost exactly how the business has worked for us. However, it might even be the 6 year mark before we really turn a profit, as I still have one big expense that I am hoping to overcome this year (a new building).

That is pretty much as I thought it would be.

What do you guys think is the proper balance for a new breeder between the co doms and the recessives? I think a lot of people jump too heavily into the co-doms and are then floored when the bottom falls really fast. I put more money into my pied/albino and soon clown projects, but realize this going to take a lot longer to return any of my investment.

Any thoughts???

Thanks!

JonV

Recessives overalll are longer term projects. You want to make a Pastel lesser, all you have to do is raise up a lesser and pastel (one Female one Male) breed them together and you have the end product. I think this is what has made the bumble bee so popular. If you want an Albino Spider now you have an all new ball game. You have to keep the Co-doms and Doms around as your bread and butter, but the recessives are really the next level. A starting out breeder would probably classify breeding two het piebalds together while trying to make a piebald a dink project. Not very many starting out breeders can afford to have two pieds in their collection right away unless this is their main breeding plan.

[muddoc]

A dedicated building....sweeet! At what point do you have to decide to hire an employee? Is there a magic number (over 60 bps?) etc...?

Are you still doing it all yourself, Tim??

JonV

A dedicated building would definitely be sweet. I have been dreaming about it for 2 years now. We plan on starting (even if it is just the foundation this year) to build a 1600 sq. ft. building. Hiring an employee would be nice, as I could get some more time back in my life, but to tell you the truth, I don't know that I could trust anyone, and I still actually enjoy the interaction I get with my snakes doing all the work myself. WE (and I stress we) do all the work ourselves. Currently we have about 150 adults and 30 yearlings in our personal collection, with about 25 animals for sale. We also breed all of our own rodents (which my wife takes care of), which is about 600 breeder animals. We are expecting about 250 hatchlings this year. So, it all equates to about 50 hours a week combined between my wife and myself for care of the business, and I don't even want to think about what the workload will be like when all of the hatchlings are here.

With all of that said, I can't stress enough what other people say all the time, "Make sure you LOVE it before you try to increase your collection." It is definitely alot of work, even for the small collection that we maintain.

p.s. I just wanted to congratulate all of the participants of this thread, for the wonderful conversations that have taken place, and all of the knowledge that I have seen spread in this thread. What a great dicussion.

[nevohraalnavnoj]

Hi Tim, thanks for all that great information. I've got the governing equation now:

150 Adults + 30 Hatchlings + Rodents = 50 hours work

plus or minus some, of course. My first goal is to top out at 30 adults (*coincidently the size of an ARS rack ) and go from there.

I agree you gotta love it or you're going to be miserable. I love cleaning snake pee, fun fun fun!

JonV

[Colin Vestrand]

I like when threads like this are brought up! Usually by guys with 15 animals.. Let the market do what it wants. I sell animals at a price I like, weather its FREE! or someone pays me what I'm asking. I could careless if albinos are at $50. I'll still produce them, Make some money and Still work My ash off at my day job. Imagine; an albino ball for $50.. everyone would buy atleast one..

Thats alot of $.. If thats what your in it for...

very well said man... too many people are worried about the money when the animals, the people, and the science of everything is really all that matters.