The credit crunch lands at my door.

Alan_M_2

silvercar wrote: »

Just noticed your in granite. Guess that is really hit by the credit crunch, not only are people not replacing their kitchens but when they do, they get near the end of the ordering and realise that granite is an expensive option.

Really makes a kitchen though, I've had my old worktops replaced with granite this week:)

Could you only stock black galaxy star, to keep your stock levels down?

We currently do Galaxy and absolute black, in volume, we were just expanding to take on Kashmir White and Kashmir gold as we get so many requests for it.

Also, we're at the budget end of the market (we deal in pre produced counter tops not slab). i.e. I sell a 2400mm x 610mm x 30mm length of galaxy for £175.68 + vat.

It's no longer as expensive as many people think.

Of course you then have to get it cut and fit...

Alan_M_2

neverdespairgirl wrote: »

What would you do in 6 months' time? Could you afford to borrow at 20% APR?

20% apr is half the cost of stock finance, no really, 40% apr is quite normal....we build the 10% into the pricing.

Preferably I want investment.

Alan_M_2

vivatifosi wrote: »

Hi Alan,

Firstly good luck with your situation. I don't know the granite industry particularly well, but do know some building products industries.

You've probably done this already, but if not, it could be worth analysing your turnover/profitability by line and only importing those lines that are most popular/profitable. Where I used to work we did this with some veneers and sold some to the trade that we didn't use and got some money in quickly, while focusing on those that were most profitable.

Are there any countries closer than India that you can get granite in from that may be more expensive but you can source more quickly/in smaller quantities?

Are there any suppliers on the continent that you can partner with and share stocks without losing your UK competitiveness?

Again if you haven't done so already, have you put your products on RIBA product selector? That may also open you up to more buyers.

I can't offer any financial advice, but do know from running my own business when I've tried to get any kind of finance in the last year I have felt like I was being made to ride a unicycle (bl**dy difficult) while juggling chainsaws (bl**dy dangerous).

Good luck!

What I buy from India at £70 per cost unit sells out of Europe at double that, as they've bought it from India to start with.

The materials we buy are geographically relevant, i.e Star Galaxy occurs in one region of India (Ongole if your curious) and that's it......it doesn't exist anywhere else.

So if I buy that elsewhere it's been shipped handled and there's other profits to add...it's just not viable.

Nomad25

Any other (constructive) suggestions gratefully received.

We are not the only business in this industry facing this issue, there are some products unavailable due to financing issues nationwide.

My reply is well meaning, but lacking in knowledge of your industry. Is there any way of networking with other or indeed similar companies, who must have same difficulties, to split this 65K worth of goods between you and then maybe re-order on same basis so stuff comes on a 'rolling delivery'within your known time frame - i.e. purchase and shipping?

sdooley

A last resort - sell the business to your biggest customer (they may be keen to preserve their supply chain).

silvercar

Alan_M wrote: »

20% apr is half the cost of stock finance, no really, 40% apr is quite normal....we build the 10% into the pricing.

Preferably I want investment.

banks, friends and family? sunday times business section has an investors section and business to business.

You need to find a city banker with a fat redundancy cheque, looking for a change of direction. Problem is how to access those sort of people.

Really2

silvercar wrote: »

You need to find a city banker with a fat redundancy cheque, looking for a change of direction. Problem is how to access those sort of people.

Seen these on the web.
http://www.angelinvestmentnetwork.co.uk/home?network=esearchvision&gclid=CNHQieGTr5gCFQ4i3godox8dVA

Most probably will want your shirt but they may be worth a look.

sdooley

Business angels/venture capitalists etc aren't interested in saving businesses but will invest if you can sell them a growth story. Any deal will leave you with little or nothing if you don't deliver that growth, though.

Really2

I think we all agree then the most likely investor you are likely to see is someone who understands/related your business.
I think trying to find somone unrelated to the industry could prove to be too long a task and very possibly a wild goose chase.

Personaly I think customers or suppliers are your best bet for an investor or even a competitor perhaps at the other end of the country?
If your product is cheaper to import etc you may be of interest to them.

Alan_M_2

sdooley wrote: »

Could you get buy-in from your staff? Doesn't say how big you are but £2K each among 30 staff in exchange for a 25% stake in the firm versus a 20%+ stake going to Dragon's Den type investors - I know which I'd choose!

Alternatively, for your larger customer orders, you already take deposits but you might find you could invoice finance the balance (if they are your larger customers they are presumably the best risks).

We're not a big company (family, there's three of us and I run it day to day), this particular industry is not staff intensive, we do not produce, we supply only.

We don't run our own vehicles (to avoid expense and the need for an operators licence). We use haulers for deliveries (far more cost efficient) however in most cases our customers collect and we positively encourage them to do so.

I don't want to give people the idea we're some huge company, that's just not the case. We operate from a 3500 sq/ft warehouse.