Quote Originally Posted by Reinz View Post
No, actually they have great business plan! They sell EVERYTHING they make, and production is sold out 2-3 months in advance. No inventory costs and no stress about moving inventory.

This means no inventory storage, no yearly taxes that they have to pay on inventory, just taxes on raw materials.

The only way shorten the delivery lag time is to produce more. To do that, they would have to work in either an extra shift or two. Heck, they may be doing that sometimes already. Or, they may need to buy more machines. The one(s) they have can only produce so many units a day. How much is machinery, $5k?, $20k?, $100k?

Along with that machine means more employees, a new or more, bigger building(s). This takes capital, capital cost money (interest). If they hire a certain number(50?) of employees they have to provide medical benefits which are astronomical.

Now, they deal in raw materials with waste. Not a lot, but some, such as the big window holes for the doors. Sure, they use those pieces for shelf brackets, but there is still waste. New employees will have a learning curve which means mistakes and even more waste.

More employees mean more problems too, they are not always the cure, they are constant headaches. What if a key person is injured in a wreck on the way to work? Production may be slowed down. What if a key woman goes on maternity leave? They quit without notice? What if, what if? It's limitless.

I'm just touching the tip of the iceberg.

So, with all of the new expenses to placate customers and keep them from whining they may have to increase prices 25-40% and no more special discounted priced cages (sale items) just to cover the new expenses.

What will these higher prices do?

They will decrease demand. Folks will go elsewhere to buy cages for less money. Now they have to lay off some folks. They still have to pay for the machines, the building leases. Their inventory will increase, which will increase their taxes. How long can they continue to pay these now extra non needed expenses before going out of business?

The above examples are just a sampling of what comprises the curse of the Mom and Pop, small business owner. Running a successful small business is a delicate balance which requires perfect timing and risk for expansion.

Trust me, they are tired of answering countless phone calls and emails about "where is my cage?" That costs them precious time and money. If they could streamline things better, they have done so or are working on it. Manufacturing is not as easy as it appears.

I don't think that I mind waiting for a well priced high quality cage. The alternative may not be to my advantage after all.
Thats not exactly how supply side economics or opportunities of scale work. Ever notice how the more of something is made the cheaper it is? Either way they have a great product. Hopefully they continue to grow.