Gone very quiet
Discussion
Used Construction equipment sales remains totally up and down. We export a lot which is handy but every country we sell to is saying there quiet and there’s a lot of inventory around. Another record breaking plant auction just took place in the uk with the qty of machinery excess . There are no track kickers around, if people come to the yard they are serious but it’s few and far between. We hold about 6 million in stock across 100-150 machines so cater for all
The housing sector seems to be under pressure regionally. There are some building control changes to footings in June and I’m told that all sites are digging like mad until this ends, they will then slow as there not selling what’s already built, they will then use the footings as stock. How true or not I have no idea but have heard it from a few sources .
The housing sector seems to be under pressure regionally. There are some building control changes to footings in June and I’m told that all sites are digging like mad until this ends, they will then slow as there not selling what’s already built, they will then use the footings as stock. How true or not I have no idea but have heard it from a few sources .
Regy53 said:
Used Construction equipment sales remains totally up and down. We export a lot which is handy but every country we sell to is saying there quiet and there’s a lot of inventory around. Another record breaking plant auction just took place in the uk with the qty of machinery excess . There are no track kickers around, if people come to the yard they are serious but it’s few and far between. We hold about 6 million in stock across 100-150 machines so cater for all
The housing sector seems to be under pressure regionally. There are some building control changes to footings in June and I’m told that all sites are digging like mad until this ends, they will then slow as there not selling what’s already built, they will then use the footings as stock. How true or not I have no idea but have heard it from a few sources .
Interesting, gives reasons behind previous posters comments about his groundworks being very busy..The housing sector seems to be under pressure regionally. There are some building control changes to footings in June and I’m told that all sites are digging like mad until this ends, they will then slow as there not selling what’s already built, they will then use the footings as stock. How true or not I have no idea but have heard it from a few sources .
Tying in with your findings, normally very hard to rent heavy plant here in central europe, currently you can take your pick and get them competing on price, yards are far from empty, no ruling changes here so groundworks equipment is plentiful, i drive past 10 or so yards across country borders and they all look the same tbh.
Digga said:
Aventador 700 said:
I hope people finding it tough hang on in there and dont give up, there's always been tough times throughout history, stick at it, mop up later is all i can say.
Recessions tend to be relatively short. I do think at certain levels, the uk is effectively in a real terms recession if you look at GDP factoring in inflation. I also think it will recover, although I think the present government and the opposition are as disconnected from real business as is possible. Clueless.Recession is hardest in a capitalist lead country i think, its hard being forced to look in the mirror thats been behind you whilst cashing in.
I dont get involved in politics and never have as i believe them to all be the same, just puppets for the extreme wealthy, read into the Rothchilds, they had to start dividing their wealth to hide the control they had over so many governments in many different countries of the world, these and a few others are the true puppeteers, no tin hat here, i actually admire them for how well they did it, i accept it has been and always will be, that way, i certainly wouldnt want my life to be about playing those games
Yes the Bld regs change in mid June so us house builders are trying to get as many footings in as possible as the plots fall under the current regs if inspected in time.
As above, it’s artificially inflating ground works activities atm.
We’re still selling but it’s the 4/5 beds. The smaller 3b stuff is dead.
As above, it’s artificially inflating ground works activities atm.
We’re still selling but it’s the 4/5 beds. The smaller 3b stuff is dead.
skwdenyer said:
Customers expect up to 20% off their first order, and a further promo, and free delivery & free returns (some brands have returns rates in the 50% range - 30% is typical).
I find check-out pages that have promo code fields very frustrating - I feel like I must be missing out by not having a code to use.And my wife had to pay return postage on something the other day and she went mental - she won’t be buying off them again. I wouldn’t mind but it became apparent to me she hadn’t had the refund and she hadn’t noticed. I get annoyed when she buys two sizes of things but she says if the item is on offer then it might not be if she gets the size wrong and wants to re-order, or (often, apparently) the item will be sold out.
Regy53 said:
Used Construction equipment sales remains totally up and down. We export a lot which is handy but every country we sell to is saying there quiet and there’s a lot of inventory around. Another record breaking plant auction just took place in the uk with the qty of machinery excess . There are no track kickers around, if people come to the yard they are serious but it’s few and far between. We hold about 6 million in stock across 100-150 machines so cater for all
The housing sector seems to be under pressure regionally. There are some building control changes to footings in June and I’m told that all sites are digging like mad until this ends, they will then slow as there not selling what’s already built, they will then use the footings as stock. How true or not I have no idea but have heard it from a few sources .
Pretty much the same in farm machinery.The housing sector seems to be under pressure regionally. There are some building control changes to footings in June and I’m told that all sites are digging like mad until this ends, they will then slow as there not selling what’s already built, they will then use the footings as stock. How true or not I have no idea but have heard it from a few sources .
We're a bit down in tractor sales but as a newish manufacturer we're always playing catch up and we're the wrong shade of green
Foragers/Combines we have over 50% of the global market and locally we sell everything we get built and the trade ins no problem.
I've never understood the "returns culture". If I order something online, I'll only return it if it's damaged or faulty (for replacement), or if it's junk (not as described, not fit for purpose).
Returning items because the buyer has changed their mind, or ordered several and just picked one to keep, seems like a massive waste of time and money for everyone concerned.
Returning items because the buyer has changed their mind, or ordered several and just picked one to keep, seems like a massive waste of time and money for everyone concerned.
Interesting topic ref clothing and some good insight provided. My only thought was how does this model of shipping and returns for the “Try at home” experience compare to the overheads of the more traditional model of having a physical store and being able to try clothes on there?
Whilst not applicable to every brand, some of the big chains must be seeing sizeable cost savings by downsizing and reducing the number of outlets they run?
Ref housing - we’re seeing similar trends in the midlands. Big stuff is shifting, FTB plots not so well.
Whilst we were going like the clappers to get foundations in 6 months / a year ago this has subdued slightly with the uplift in costs not being as onerous as initially anticipated (Still a good £3/£4k for an average plot).
Whilst not applicable to every brand, some of the big chains must be seeing sizeable cost savings by downsizing and reducing the number of outlets they run?
Ref housing - we’re seeing similar trends in the midlands. Big stuff is shifting, FTB plots not so well.
Whilst we were going like the clappers to get foundations in 6 months / a year ago this has subdued slightly with the uplift in costs not being as onerous as initially anticipated (Still a good £3/£4k for an average plot).
clockworks said:
I've never understood the "returns culture". If I order something online, I'll only return it if it's damaged or faulty (for replacement), or if it's junk (not as described, not fit for purpose).
Returning items because the buyer has changed their mind, or ordered several and just picked one to keep, seems like a massive waste of time and money for everyone concerned.
Apart from the end customer. Lazy consumerism.Returning items because the buyer has changed their mind, or ordered several and just picked one to keep, seems like a massive waste of time and money for everyone concerned.
clockworks said:
I've never understood the "returns culture". If I order something online, I'll only return it if it's damaged or faulty (for replacement), or if it's junk (not as described, not fit for purpose).
Returning items because the buyer has changed their mind, or ordered several and just picked one to keep, seems like a massive waste of time and money for everyone concerned.
Doesn’t it depend what goods you’re buying as a customer. Returning items because the buyer has changed their mind, or ordered several and just picked one to keep, seems like a massive waste of time and money for everyone concerned.
Electrical goods I agree with you - but clothing is a different matter - I love a bit of Joules and recently near me we’ve gone from 5 stores in a 30 mile radius to none……. So I bought 5 items of clothing fully expecting to return some of them retailers can’t have it both ways and if the cost lands with the customer I’ll be less inclined to shop with at those retailers.
clockworks said:
I've never understood the "returns culture". If I order something online, I'll only return it if it's damaged or faulty (for replacement), or if it's junk (not as described, not fit for purpose).
Returning items because the buyer has changed their mind, or ordered several and just picked one to keep, seems like a massive waste of time and money for everyone concerned.
With clothing customers could quite easily find themselves between sizes, (dress size 10 / dress size 12). Returning items because the buyer has changed their mind, or ordered several and just picked one to keep, seems like a massive waste of time and money for everyone concerned.
They might be a size 10 for one brand, but a size 12 for another brand, and aren’t sure which one until they try them on.
Sorry for the Mirror link, but: https://www.mirror.co.uk/money/money-talks-is-ever...
Some brands just throw out all returned items now…
Some brands just throw out all returned items now…
skwdenyer said:
We design & have manufactured women’s mid-market clothing. We sell retail (online) & wholesale (direct & via agents). We sell to the UK, EU & North America.
You’re right about margins. Take Internet Fusion - they grew to £110m turnover, but margins were slim-to-none.
Much of fashion has essentially been struggling since the GFC in ‘08. Most of us buy in USD & sell in GBP (and EUR and some USD). GBP was 2 USD back then… Meanwhile wage inflation in places like India has been running at 7.5% pa for 15 years, and commodity prices (especially cotton) have been pretty, err, volatile recently.
During Covid, logistics prices went through the roof. They’ve come down, but not reverted entirely.
And so on. This is why clothes often don’t seem as durable these days (they’re not - they’ve been value-engineered to try to keep increases down); it is why so much moved to China - which has had its own problems of late.
UK online retail is also a major problem area for clothing - people expect free delivery, free returns, and constant discounts / proportions. The rise of “performance marketing” (which basically means paying operations like voucher and cashback sites for clicks) has generated another hand in the till, as it were. Customers expect up to 20% off their first order, and a further promo, and free delivery & free returns (some brands have returns rates in the 50% range - 30% is typical).
Those clicks can easily cost you 10% of the gross sale (before returns) = 15% of net sales (because you still pay to acquire the customer who returned their order). Add, say, 20% off first order, and your acquisition cost has just gone up a lot.
Here are some numbers. Not mine per se, but not unrepresentative of the sector.
Consider a garment selling online at, say, £80. With 20% off your first order, that’s £64 - £53 without VAT. That piece probably cost £15 landed in the UK. Free delivery cost, say, £5, and the free return (at 30% rate) cost £1.75 (average). Pick & pack outbound & return perhaps another £3. You might see 15% loss / unsellable returns, too, so that’s another, say, £0.75 off the bottom line. Consumables, card processing, etc - add another £1.25 per item. And the acquisition cost could easily be £8.
So now you’ve taken £53 and paid out £35. So you’ve made £18 gross (34%). From that you’d have to pay warehousing, design, garment tech, QC, testing, certification, marketing, shoot fees, insurance, PR, admin, accountancy, offices, IT etc. And there will be dead stock each season that needs clearing. And of course the financing cost of acquiring boat loads of stock. So the gross margin over the whole piece is probably closer to 20%. If you’re employing, say, 10 people at an average of £40k per head, and putting them in an office with usual accoutrements, you need to shift probably £3m of net sales to break even - before returns that’s closer to £4.5m of top line sales. Plus VAT
There are an awful lot of brands out there on life support, chasing volume in hopes of being able to ride it out. But actual profit isn’t so easy. Not unless you can offshore an awful lot of the underlying activity to much lower-wage countries.
Internet Fusion (who I mentioned earlier - ran Surfdome, Country Casuals, etc) bought at wholesale. So they were probably paying £27 for an £80 (RRP) garment. Their underlying costs weren’t all that different to the above (no designers, but a lot more marketing spend). It isn’t hard to see how they were still making no money on >£100m of sales.
What you’re seeing is what I’d expect you to say SHEIN, Next are basically platforms now where others take a lot of the risk (and make no money) - great if you can get it. Same for Vinted - where there a lot of sellers operating either as solo operators without really costing their time.
The industry is in a funny place right now. The key is going to be figuring out how to add value for lower in-cost (ie higher in-margin). With the FX rate where it is, that’s now not easy. Throw in a cost of living crisis and you have a perfect storm for a lot of brands to vanish / go bust & be bought up / etc over the next year or so.
Skydenyer, many thanks You’re right about margins. Take Internet Fusion - they grew to £110m turnover, but margins were slim-to-none.
Much of fashion has essentially been struggling since the GFC in ‘08. Most of us buy in USD & sell in GBP (and EUR and some USD). GBP was 2 USD back then… Meanwhile wage inflation in places like India has been running at 7.5% pa for 15 years, and commodity prices (especially cotton) have been pretty, err, volatile recently.
During Covid, logistics prices went through the roof. They’ve come down, but not reverted entirely.
And so on. This is why clothes often don’t seem as durable these days (they’re not - they’ve been value-engineered to try to keep increases down); it is why so much moved to China - which has had its own problems of late.
UK online retail is also a major problem area for clothing - people expect free delivery, free returns, and constant discounts / proportions. The rise of “performance marketing” (which basically means paying operations like voucher and cashback sites for clicks) has generated another hand in the till, as it were. Customers expect up to 20% off their first order, and a further promo, and free delivery & free returns (some brands have returns rates in the 50% range - 30% is typical).
Those clicks can easily cost you 10% of the gross sale (before returns) = 15% of net sales (because you still pay to acquire the customer who returned their order). Add, say, 20% off first order, and your acquisition cost has just gone up a lot.
Here are some numbers. Not mine per se, but not unrepresentative of the sector.
Consider a garment selling online at, say, £80. With 20% off your first order, that’s £64 - £53 without VAT. That piece probably cost £15 landed in the UK. Free delivery cost, say, £5, and the free return (at 30% rate) cost £1.75 (average). Pick & pack outbound & return perhaps another £3. You might see 15% loss / unsellable returns, too, so that’s another, say, £0.75 off the bottom line. Consumables, card processing, etc - add another £1.25 per item. And the acquisition cost could easily be £8.
So now you’ve taken £53 and paid out £35. So you’ve made £18 gross (34%). From that you’d have to pay warehousing, design, garment tech, QC, testing, certification, marketing, shoot fees, insurance, PR, admin, accountancy, offices, IT etc. And there will be dead stock each season that needs clearing. And of course the financing cost of acquiring boat loads of stock. So the gross margin over the whole piece is probably closer to 20%. If you’re employing, say, 10 people at an average of £40k per head, and putting them in an office with usual accoutrements, you need to shift probably £3m of net sales to break even - before returns that’s closer to £4.5m of top line sales. Plus VAT
There are an awful lot of brands out there on life support, chasing volume in hopes of being able to ride it out. But actual profit isn’t so easy. Not unless you can offshore an awful lot of the underlying activity to much lower-wage countries.
Internet Fusion (who I mentioned earlier - ran Surfdome, Country Casuals, etc) bought at wholesale. So they were probably paying £27 for an £80 (RRP) garment. Their underlying costs weren’t all that different to the above (no designers, but a lot more marketing spend). It isn’t hard to see how they were still making no money on >£100m of sales.
What you’re seeing is what I’d expect you to say
SHEIN, Next are basically platforms now where others take a lot of the risk (and make no money) - great if you can get it. Same for Vinted - where there a lot of sellers operating either as solo operators without really costing their time.The industry is in a funny place right now. The key is going to be figuring out how to add value for lower in-cost (ie higher in-margin). With the FX rate where it is, that’s now not easy. Throw in a cost of living crisis and you have a perfect storm for a lot of brands to vanish / go bust & be bought up / etc over the next year or so.
and I wish you good luck and good fortune over the coming months Aventador 700 said:
I value your posts greatly, boots on the ground give a real feel, getting your clients feedback is a great addition, i feel its more of an unmasked feel for things, im sure i speak for many when i thanks for the input.
Not a problem The more we all contribute to this thread, the clearer a picture we are all able to develop about how things are currently going and about how things are likely to go over the next 3-6 months.
Sometimes being sat in an office looking at raw data on a spreadsheet may be slightly misleading, that is where ‘boots on the ground’ info helps to fill in any gaps.
Similarly, only having a ‘boots on the ground’ perspective without the benefit of (in comparison), meta-data can also paint an inaccurate picture.
Both perspectives complement each other IMO.
Dsdans said:
Ref housing - we’re seeing similar trends in the midlands. Big stuff is shifting, FTB plots not so well.
South Nottinghamshire seeing similar. Nice properties still have a huge queue of interest - buyers still happy to pay over the odds. Cars are similar - the big shiny nice expensive stuff is still in a supply/demand trap. No slowdown in demand for luxury holidays either. The wealth gap has widened massively post-Covid. Lots and lots of money still being earnt and spent. It's certainly not your typical recession or slow down DSLiverpool said:
Huge growth in 3PL (contracted out store, pick, pack, ship) as brands don’t want the commitment of a warehouse lease / staff etc plus you can scale up / down.
3PL is where it’s at.
Just to +1 this post in case you felt it fell on deaf ears. This is a massive growth sector. And such an obvious one when you think about. Like all good ideas. 3PL is where it’s at.
I can do land, planning, buildings and finance. If anybody on here does logistics dm me and this time next year we’ll be millionaires
ben5575 said:
DSLiverpool said:
Huge growth in 3PL (contracted out store, pick, pack, ship) as brands don’t want the commitment of a warehouse lease / staff etc plus you can scale up / down.
3PL is where it’s at.
Just to +1 this post in case you felt it fell on deaf ears. This is a massive growth sector. And such an obvious one when you think about. Like all good ideas. 3PL is where it’s at.
I can do land, planning, buildings and finance. If anybody on here does logistics dm me and this time next year we’ll be millionaires
I also use NL 3PL, which is better but still inflexible for our needs.If you have packaged goods and easy returns, 3PL makes a lot of sense (just not FBA unless you sell primarily single units); if your needs are complex, require judgement, or don’t turn very fast, my own experience is that I’d *fully* model *all* of the costs and opportunities before deciding on 3PL.
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