When certain economic conditions are good, there is always a downside somewhere. For example, lower interest rates are generally good for the housing market but bad as an incentive to save. And when certain conditions are bad, there is typically an upside to be found somewhere.
This year we've seen 3 major economic changes - higher gas prices (and with it higher food prices), the falling value of the dollar in the global market and the current credit and banking mess. While there have been upsides and downsides to each, we have so far weathered these issues quite well. Here's an inside look you'll not get from any other company in our industry.
Higher Gas Prices
The Downside: Increased shipping costs are up to ship inventory in to us and out to you in your orders. We have yet to pass this increase along to you with the exception that our free shipping offer went up from a $200 to $250 minimum.
The Upside: You'd think that higher gas (and food) prices would only hurt sales, but you'd be surprised to see that more people get into officiating to make additional money when the economy is worse, thus creating the additional need to purchase referee gear and umpire equipment.
Falling Value of the Dollar
The Downside: As with any sporting goods retailer, some items are going to be made in the U.S.A. and some are going to be imported. For us, most of our clothing is made in the U.S. while all shoes, protective gear and equipment bags are imported.
The biggest negative impact the economy has had on us is that some of the wholesale prices (prices to us) of goods made overseas have increased dramatically, in some cases as much as 25%. For example, one of our plate shoes did cost us $60. With an increase, our cost is now $75.
Regardless, I foresee that all official sporting goods retailers will ultimately either raise their prices on many of their imported items or discontinue several of these items whose price points would now prove unprofitable. More specifically for us, we're looking at reviewing our prices on protective gear, re-shaping our umpire plate shoes selection, and discontinuing 1 Wilson mask (the soft amara mask).
The Upside: We have experienced an increase in orders from international customers who are finding goods bought in the U.S. are now a better bargain as the value of their currency is stronger compared to the dollar. I'd like to say the increase here offsets the above downside, but this is not the case given our volume of U.S. orders relative to international ones.
Credit/Banking Crisis
No Upside or Downside (for Now): While a bailout is currently underway, I doubt there will be any direct repercussions either way as far as we're concerned unless a lack of a bailout creates an overall catastrophic meltdown in the economy... which I'm not smart of enough to predict one way or the other.
Summary
In my opinion, the greatest economic downside to all of us (you, me, our company and the U.S as a whole) listed above has been due the falling value of the dollar. Directly it has raised prices of imports and provided an incentive for overseas investors to move more money into commodities like oil, which has in turn been a large factor for gas price increases, which in turn has lead to higher shipping, food and business operating costs, which all together has been a drag on the economy.
Tuesday, September 30, 2008
Friday, September 19, 2008
Hurricane Ike Power Outage Doesn't Stop Us
I never thought I'd be talking about a hurricane hitting the Louisville area, but there are firsts for everything.
The hurricane that so heavily wrecked Galveston, Texas and the surrounding areas and the system it brought up through the Midwest provided our area with wind gusts up to 80mph Sunday afternoon (9/14).
These wind gusts caused tornado-like damage knocking down trees and over 3,000 power lines all over metro Louisville.
As a result, 300,000 lost power and phone service including our office and every staff person here. Fortunately, our website is hosted on servers at another location so you could continue to shop despite our total lack of functionality on the back end.
So if you tried to call us Monday and Tuesday and only received an answering service, then now you know that we had not simply gone belly up. If you did call and left a message or called back, thank you for your patience through what the Louisville powers-that-be are calling the worst power outage in Louisville's history.
On Monday morning, I elected to send everyone home while I worked out a solution to what the power company was calling a potential 10-14 day outage! With the phones out and no orders to process, there was little for them to do. Regardless, waiting that long to send your orders out from the weekend and placing a "Your order will ship in 2 weeks" message at checkout on the website was completely unacceptable.
A company called Computers Plus on Westport Rd in Louisville had both power and Internet access and were gracious enough to allow us to park one computer and a printer there for as long as we needed. By 1pm, I was setup there and processing orders. By 3pm the Monday crew had come back into the warehouse to begin filling them.
By 5pm, 80% of the orders from Friday evening through Monday - including all U.S. expedited and priority mail orders - were packed and loaded up into multiple vehicles and delivered to the local post office and the UPS store as we had missed our pickup deadlines for both UPS and USPS.
Even I was impressed. It certainly would not have happened had it not been for the hospitality of Riley and the rest of the guys at Computers Plus and a great crew here that included an in-town visitor of Paul and Jeanne from Miami, Steve Funk, who jumped in with both feet to help.
Tuesday was more of the same but with an earlier start. By late Tuesday afternoon, both power and phone service had returned at the office and all was well in our business world.
Note: The picture is of a downed power pole close to my house and likely the source of a continuing day 6 without power at home.
The hurricane that so heavily wrecked Galveston, Texas and the surrounding areas and the system it brought up through the Midwest provided our area with wind gusts up to 80mph Sunday afternoon (9/14).
These wind gusts caused tornado-like damage knocking down trees and over 3,000 power lines all over metro Louisville.As a result, 300,000 lost power and phone service including our office and every staff person here. Fortunately, our website is hosted on servers at another location so you could continue to shop despite our total lack of functionality on the back end.
So if you tried to call us Monday and Tuesday and only received an answering service, then now you know that we had not simply gone belly up. If you did call and left a message or called back, thank you for your patience through what the Louisville powers-that-be are calling the worst power outage in Louisville's history.
On Monday morning, I elected to send everyone home while I worked out a solution to what the power company was calling a potential 10-14 day outage! With the phones out and no orders to process, there was little for them to do. Regardless, waiting that long to send your orders out from the weekend and placing a "Your order will ship in 2 weeks" message at checkout on the website was completely unacceptable.
A company called Computers Plus on Westport Rd in Louisville had both power and Internet access and were gracious enough to allow us to park one computer and a printer there for as long as we needed. By 1pm, I was setup there and processing orders. By 3pm the Monday crew had come back into the warehouse to begin filling them.
By 5pm, 80% of the orders from Friday evening through Monday - including all U.S. expedited and priority mail orders - were packed and loaded up into multiple vehicles and delivered to the local post office and the UPS store as we had missed our pickup deadlines for both UPS and USPS.
Even I was impressed. It certainly would not have happened had it not been for the hospitality of Riley and the rest of the guys at Computers Plus and a great crew here that included an in-town visitor of Paul and Jeanne from Miami, Steve Funk, who jumped in with both feet to help.
Tuesday was more of the same but with an earlier start. By late Tuesday afternoon, both power and phone service had returned at the office and all was well in our business world.
Note: The picture is of a downed power pole close to my house and likely the source of a continuing day 6 without power at home.
Jonathan Capps - Newest Team Member
We've quickly come to find out that "Cappy" is a working machine after only his second week. For now, the all-around nice guy will spend most of his time handling our inventory and assisting in sending out your packages.Jonathan was born in Atlanta, spent his youth in Knoxville where he cheered heavily for the Tennessee Vols and just recently moved here from Pittsburgh. Jonathan is the third graduate and baseball player of Centre College ('05) here in addition to myself ('92) and Paul ('92).
Besides the new gig here, he is also a glass artist and will be getting married soon to his college sweetheart. We're very excited about adding such a quality person to our staff.
Subscribe to:
Posts (Atom)
