Ok, Steve, so I related issues from two different strings. World
crisis...world economy...RP market...large RP bureaus...small RP
bureaus...this connection works for me! I don't have an economics
degree and I don't wear the business degree I have on my sleeve, but
I know that global and national economic dynamics (macroeconomics)
will affect large and and small RP businesses (microeconomics) alike.
Like others on the RP-ML, I am simply rebutting the blanket
assumption that smaller RP bureaus are more susceptible to failure
during an economic depression or recession than larger ones. I'm not
sure that would actually be the case.
Ron Clemons
> This is a microeconomic arguement versus the macroeconomic analysis which started
> this discussion.
>
> On the individual firm and the appropriate size to take advantage of this fast
> paced industry, there seems to be a very fine line because of the high capital
> investment and the changing nature of the technology. One individual cannot shell
> out the $60,000 to $500,000 for major RP equipment and hope to do a volume of
> business which will amortize the equipment efficiently, and quickly. So they add
> a few CAD designers to the staff and a few CAM operators and increase the volume
> of business. Now the RP is being amortized but salaries are eating up the profits
> unless the company can guarantee a steady and high rate of labor utilization. But
> as this is state of the art cutting edge stuff, the orders do not come in evenly.
> So the company takes in more work than they can hope to accomplish and by running
> a backlog they have high utilization of assets and labor.
>
> Customer satisfaction declines though as work is not accomplished on time and the
> decision must be made to service a few key accounts well and let the others
> matriculate or give evenly mediocre service and have your entire customer base
> matriculate. Maybe you add another CAD operator as the backlog gets too great.
> Then you have the problem of RP bottlenecks but business is good so you buy
> another RP machine. Round and around until you get too big to change with the
> industry and you fail.
>
> So this seems to be the paradox of the microeconomic aspects of this high capital
> cost and fast changing technology.
>
> But this is separate from the world crisis analysis we were talking about.
>
> Steven Pollack
> The Missing Link Jewelers
> http://www.familyjeweler.com
>
> Ron Clemons wrote:
>
> > On the other hand, this might just do in another larger and less
> > efficient service bureau or two! Slow-moving bureaucracies can have
> > a hard time adapting to industry changes--especially in quick fashion-
> > -resulting in layoffs, cutbacks and/or filing chapter something-or-
> > other bankrupcy.
> >
> > Where have the Psychic Hotline folks weighed in on the issue of the
> > global and U.S. economies and the RP industry?
> >
> > Ron Clemons
> >
> > From: Joe Allison <Joe@SolidConcepts.com>
> > Subject: World Economy vs US RP Market
> >
> > > This will drive some of the smaller and less efficient service providers out
> > > of the business, but you will see growth in the overall industry. Unless,
> > > of course, the entire world economy collapses.
> > >
> >
> > *******************************
> > Ron Clemons
> > Dir. of Marketing
> > Harvest Technologies
> > http://www.harvest-tech.com
> > ******************************
> >
> > For more information about the rp-ml, see http://ltk.hut.fi/rp-ml/
>
*******************************
Ron Clemons
Dir. of Marketing
Harvest Technologies
http://www.harvest-tech.com
******************************
For more information about the rp-ml, see http://ltk.hut.fi/rp-ml/
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