Inventory, Inventory, Inventory. This is the key to our business and probably most retail businesses. In fact, without inventory we would not have a business.
In my initial business plan, which I drafted pre-March 2020, I presumed that we would need to start with 3 months worth of inventory. This is based upon the presumption that new orders placed would take 2 months to fulfill. This way, after one month in, I could reassess our updated needs and place a fresh order.
Now orders are taking 6 months to fulfill for many mills (Some mills will not even accept new customers or orders). This means that I need to have on hand 8 months worth of inventory allowing me to reassess my needs after 2 months in order to place a new, slightly educated order, in time to ensure that my racks are always filled.
This in turn means that I need to have additional shelving and storage. I need to be sure my stored surplus does not warp or weather.
Essentially I need to have 2.5 times the working capital that I anticipated plus an estimated $30,000 in storage upgrades.
At times I picture that I am Paul from the “Rocking Horse Winner” by DH Lawrence riding on my rocking horse and “charging madly into space” hearing whispers all around of “There must be more money!” (If you have not read this short story I insist that you do. It is significant.)
But the ending for myself and my partners will not be so tragic. We are adjusting and pivoting and adapting to this new way of being. We are making it work, as they say. And to be honest it is thrilling, engaging and exciting. This is a crazy time to be alive and definitely a crazy time to start and manage a business but I love a good challenge. Don’t you?
Hope to see you all soon.
Sincerely,
Michael Friedland and the entire Lumbery Crew AKA Ents.
LUMBERY
mainewood@lumbery-me.com
www.lumbery-me.com