Forum Discussion
WTP-GC wrote:
And such is the mincing of words...
The determination of your profit is indeed a margin of cost. If your profit margin is 10% or 100%, it's going to remain the same regardless of the cost paid by the seller for the item. Everybody knows that profit is revenue minus expense, but you maintain the same profit margin when you can. In the contracting world, if the job costs are $200K or $400K and I use a 10% profit margin, I'm dang sure not going to do the $400K job for $20K profit. But the logic expressed by some people in this thread suggests that I should.
Key phrase: "when you can".
The truth is you don't "maintain the same profit margin when you can"; you earn as much profit margin as the market will allow. You will bill a 20% margin, if you can, unless you don't like getting richer.
Key phrase: "as the market will allow".
Now, if you don't understand how that supports my argument, I'm not going to explain it any more. Just keep blindly adding 10% to your contracts.China doesnt need US as much as you think
Their economy is booming as they expand all over the world into Europe Africa Russia and so on.
Look up Silk road China for example
China megaprojects
https://youtu.be/s3qma0pROi0
China makes friends while America makes enemies and wars,fact
China high speed rail,
https://youtu.be/0JDoll8OEFE
Btw
China has most billionaires in the world,so much for Communism failure eh
https://youtu.be/CSCmc6ezllU
China's economy is slowing and no longer booming. economics.com/countries/china
They have lost some billionaires since the 2005 You Tube post. There is now an elite class that is connected to the those who run the country where as the majority of their people live a substandard life.
Their infrastructure is growing at a mind boggling rate but keep in mind that this is new and much needed. 30 or so years ago they were a backward nation
https://www.fastcompany.com/1749952/problem-chinas-high-speed-rail
All of their mega projects suffer from corruption, over budget, poor workmanship, substandard and unsafe. No one wants to ride it because they can't afford it and will be forever subsidized by taxes.troubledwaters wrote:
If it's made of steel, I'll pass. I'm not in NEED for a bridge today
You want to buy a bridge?DallasSteve wrote:
WTP-GC wrote:
DallasSteve wrote:
I saw the same story this morning and I thought about starting a thread like this one. I'm actually hoping for a big recession soon. Sorry about that. It would probably help me since I am retired and planning to buy an RV next year. I'm not working so losing my job is not a worry and RV prices would probably be cut - simple economics. Too much supply, not enough demand. It would also probably reduce the number of RV park visitors and drop those prices.
Which brings me to:pianotuna wrote:
I'm a small business man. If I buy an item to resale and it costs me $10 then I sell it for $20. So if there is a 25% tariff it would cost me $12.50 and I'd sell it for $25.00.
That represents quite a large jump in price to my client.
Mr Small Business Man, as a former CPA I have a question. Why would your price go to $25.00 instead of $22.50? At $25.00 your profit jumps 25%. That's a jump that would make a hospital CEO blush. At $22.50 you cover your increased cost and you get the same $10 profit. If I'm your competitor that's what I would do and most customers would come to me.
Edit: I see that Schlep beat me to this observation by 3 minutes. Good work Schlep.
Steve
As a retired CPA, why don’t you see profit as a percent instead of a number? $10 item sold for $20 is 100%. $12.50 item sold for $25 is 100%. Exposure and risk increased, so the profit should follow suit. The margin didn’t increase. By your logic, a $10 profit is equitable on a $10 good the same as a $20 good or a $2000 good.
Again...profit is a MARGIN of cost, not a fixed number.
WTP
Profit is not "MARGIN of cost". Profit is revenue minus expenses. I promise you. Part of getting my bachelors degree in Accounting required 2 semesters of Economics. If he has a monopoly he can charge what he wants, but in the real world he probably has competitors and if they could make a good profit with a $10 markup before, they can make a good profit with a $10 markup after, and they will undercut his $12.50 markup.
Steve
And such is the mincing of words...
The determination of your profit is indeed a margin of cost. If your profit margin is 10% or 100%, it's going to remain the same regardless of the cost paid by the seller for the item. Everybody knows that profit is revenue minus expense, but you maintain the same profit margin when you can. In the contracting world, if the job costs are $200K or $400K and I use a 10% profit margin, I'm dang sure not going to do the $400K job for $20K profit. But the logic expressed by some people in this thread suggests that I should.troubledwaters wrote:
2112 wrote:
Someones lying. Tariffs aren't 43%. Someone took advantage of your misfortune big time.troubledwaters wrote:
The fact of the matter is, if you are satisfied with the cost of the product your buying, buy it; if not, don't buy it.
My 325gal home propane tank started to leak last week. All the suppliers had in stock for a replacement were 500 and 1000gals. I needed a new tank right then. All three companies I called said 8 months ago the price of a 500 gal US made tanks jumped from $1400 to $2000 overnight. I didn't have a choice, I had to buy it. The tariff cost ME $600.
More to the story...
I wouldn't doubt that the propane companies (which are actually the people selling the tanks) experienced a price increase from their supplier. Someone is certainly taking advantage of someone, but as the song says..."who's cheatin who"? While the tanks themselves might be built in the USA, the tank heads are manufactured in China and imported. There were lots of exporters and importers that made a reactionary decision to increase the cost of their goods in a speculative manner when it appeared that tariffs were going to be an issue. Is like when oil prices increase, the gas station immediately raises their prices, even though the fuel they have on hand wasn't purchased at that higher price.2112 wrote:
You want to buy a bridge?troubledwaters wrote:
Nobody is lying to me. The US steel manufacturers took advantage of the tariff and jacked up their prices2112 wrote:
Someones lying to you. Tariffs aren't 43%. Someone took advantage of your misfortune big time.troubledwaters wrote:
The fact of the matter is, if you are satisfied with the cost of the product your buying, buy it; if not, don't buy it.
My 325gal home propane tank started to leak last week. All the suppliers had in stock for a replacement were 500 and 1000gals. I needed a new tank right then. All three companies I called said 8 months ago the price of a 500 gal US made tanks jumped from $1400 to $2000 overnight. I didn't have a choice, I had to buy it. The tariff cost ME $600.
By your own admission, it wasn't tariffs, it was someone taking advantage of you; and you bought anyway.
The price of steel went up 6.2% in the last 8 months Clicky
someone else got the other 36%troubledwaters wrote:
Nobody is lying to me. The US steel industry took advantage of the tariffs and jacked up their prices and it trickled down from there. That's the only time "Trickle Down" works2112 wrote:
Someones lying to you. Tariffs aren't 43%. Someone took advantage of your misfortune big time.troubledwaters wrote:
The fact of the matter is, if you are satisfied with the cost of the product your buying, buy it; if not, don't buy it.
My 325gal home propane tank started to leak last week. All the suppliers had in stock for a replacement were 500 and 1000gals. I needed a new tank right then. All three companies I called said 8 months ago the price of a 500 gal US made tanks jumped from $1400 to $2000 overnight. I didn't have a choice, I had to buy it. The tariff cost ME $600.2112 wrote:
Someones lying. Tariffs aren't 43%. Someone took advantage of your misfortune big time.troubledwaters wrote:
The fact of the matter is, if you are satisfied with the cost of the product your buying, buy it; if not, don't buy it.
My 325gal home propane tank started to leak last week. All the suppliers had in stock for a replacement were 500 and 1000gals. I needed a new tank right then. All three companies I called said 8 months ago the price of a 500 gal US made tanks jumped from $1400 to $2000 overnight. I didn't have a choice, I had to buy it. The tariff cost ME $600.troubledwaters wrote:
The fact of the matter is, if you are satisfied with the cost of the product your buying, buy it; if not, don't buy it.
My 325gal home propane tank started to leak last week. All the suppliers had in stock for a replacement were 500 and 1000gals. I needed a new tank right then. All three companies I called said 8 months ago the price of a 500 gal US made tanks jumped from $1400 to $2000 overnight. I didn't have a choice, I had to buy it. The tariff cost ME $600.
