How to save money in a crisis? A Russian fable about the timber trade.
Not the first crisis we have had in March, unfortunately not the first ...
Back in 2020, inspired by buying up TV sets, I wrote my "Fable of the Lumber Trade" about why lumber prices can rise regardless of crises and currency exchange rates. Today is March 2022 and a new crisis, and to your attention, the same post I wrote 2 years ago:
How do you make sure you don't lose money in a crisis in 2020?
During the last crisis people were buying household appliances, 33 TV sets, currency at 100 RUB/euro, relying on its further growth...
In the end, in all cases... the money was gone after all.
Therefore, for your attention:
⠀ "A new Russian fable about the timber trade" from Timber Expert.
Kolya, Vasya and Petya produce larch terrace boards. Kolya has a one-year contract with Jackie Chan. 100 p/m2. Vasya has a wholesale contract with Ivan Ivanovich, who sells at the construction market for 100 r/m2. And Petya sells to everyone at 110 p/m2 without intermediaries.
The exchange rate went up 20%. Kolyan, rejoicing, increases the volume of Jackie's shipments to China and goes to Vasya with a suggestion: "How about I buy some or all of your volume at 110 p/m2?" Because with the exchange rate going up, he's already selling it for 120. Vasya is not stupid - he wants to make money and agrees. And then Ivan Ivanovich comes to Vasya and says: "The season is coming, I need produce for the market!" And Vasya says there isn't any, he sold it to Kolya for 110.
Ivan Ivanovich can't be left out, but he doesn't want to offer Vasya 120. And he remembers Petya, who has a price of 110. Consequently, it is more profitable for Petya to sell at 110 wholesale than retail. He either stops selling at retail or raises his price to 130 roubles/m2.
Ivan Ivanovich, because he bought more expensive wholesale, raises the price on the market from 120 to 140!
The moral of the story: although a Russian manufacturer, "in theory", is in no way related to the exchange rate, the price for you as the end consumer has increased by 20%, and so has the exchange rate!
As a consequence of all the above, the prices of all wood products can go up. Think about it.
So now the building season is just starting.
A little humour certainly does us all good right now, but in every joke, there is a grain of who has a sense of humour.
If you don't know what to do, but you've had thoughts about building or renovating, building a new terrace or renovating your old one, refurbishing your patio, or perhaps you've been thinking about a modern and durable new façade, then lumber from Siberian larch is one of the best solutions.
Decided to pour a foundation? Get your hands on some lumber for the formwork. Decided to build a frame house, we have for you planed board...
Dear Reader! The above information IS NOT ADVERTISING and DOES NOT constitute advice or an appeal to invest in TVs, terraces or anything else...
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