There is no question that building bikes in batches brings the price down and ties up cash in inventory. The easy thing to do in theory that is hard in practice, is to have a good solid number that represents your absolute max possible inventory in dollars. For the sake of argument, let's say that number is 1 million dollars. Any small business that thinks their MAX inventory might be $1M, needs to keep enough cash on-hand such that their Current Inventory + Current Cash >= $1M. That way, no matter what you need to buy, no matter what bills need to be paid, you'll have the cash on hand to do it. This means you have to have a good ceiling number, you have to have the disciplne to gather and maintain that right amount of cash on hand, and you have to have the discipline to never violate your ceiling number. The bigger the business, the harder that is. A tiny operation like Black Mountain Cycles does a good job of that. Mike brings in a batch of frames when he needs them, and always has the cash on hand to pay for them. He's got a good number, and good discipline, and never scrambles, but he also only has two models of frame. OK 2.5 models, but soon to be 4.5 models. More importantly, he has one employee, himself.
Bill Lindsay El Cerrito, CA On Tuesday, February 27, 2018 at 10:33:05 AM UTC-8, Eric wrote: > > I was surprised to hear about the long wait time w/ Waterford. > > I do recall Box Dog Bikes had a successful partnership with Winter > Bicycles to do batches of the Pelican. > > Would some sort of arrangement with other builders be beneficial for Riv? > -- You received this message because you are subscribed to the Google Groups "RBW Owners Bunch" group. To unsubscribe from this group and stop receiving emails from it, send an email to rbw-owners-bunch+unsubscr...@googlegroups.com. To post to this group, send email to rbw-owners-bunch@googlegroups.com. Visit this group at https://groups.google.com/group/rbw-owners-bunch. For more options, visit https://groups.google.com/d/optout.
