Official Luthiers Forum!

THE QUESTION: So other than bumping hourly rates and complaining, what are small shop pros doing to minimize impacts?

WHY I ASK:

On Sat, I had a chance to chat with a half-dozen area luthiers at Mr. Stock's "Over the Hill/Flying into the Sunset' gathering. A common conversational topic was the rapidly rising cost of everything from solvents to paper towels to poly dose cups. Plywood for molds is up 50-60 percent over 2020 prices, and petrochemical-derived products about the same. A gallon of lacquer thinner is up $9 over early 2021, while distilled water bumped up about $.30 per gallon despite being a locally-produced product.

Stewart MacDonald has recently cut their wholesale discount from what was often 35-40 percent on higher-volume, commonly used items such as CTS pots, Crislin saddle and nut stock, and Waverly pins to a uniform 20% across the entire line of offerings...great if just tooling up, but a steep spike in cost for established shops with a steady diet of pins, saddles, bridges, and pots.

Final inflation numbers for 2021 look like those of the late 1970's, when mail-order companies updated catalog prices every month with a reliable 2-3 percent adjustment (we had old Woodcraft catalogs in the Greenridge library/hoarding room from the 1977-1983 era...the price inflation was breath-taking).

The conversation eventually shifted to coping mechanisms and cost-reduction measures...some of which were more fanciful than to-be-realized. There were a few gems, but it seemed to me that casting a broader net might be worthwhile here on the OLF.

Now if we can refrain from assigning blame/grousing about foreign leaders addicted to bad plastic surgery, Mr. Kragenbrink might allow this thread to survive and bear fruit, rather than face the fate of my 'Small Shop Wu-Flu' post a few months back (i.e., rendition to a non-public forum page accessible only to the site owner and his dog).

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A constellation only takes shape when one maps the whole.
- Beth Brower

Seriously - be specific about WHAT impacts.

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"Act your age, not your shoe size" - Prince

Upward pressure on overhead, which always seems to lead wage pressure. That said, small shop luthiers most often are self-employed, so overhead and how much to mark up cases, etc. would seem to be where cost-avoidance or cost savings strategies might help avoid the dreaded note to the customer base that "...rates will increase effective May 1st, to $$$."

One thing I did notice was solvent purchases went to larger containers...where we had 2-3 gallons of napththa, acetone, denatured alcohol, and lacquer thinner under one of the benches, there are now 5 gallon poly containers from a supplier in PA. Costs are still about where 2020 per gallon costs were, but that is still a sizable discount versus big box or paint store prices.

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A constellation only takes shape when one maps the whole.
- Beth Brower

It's been an opportunity for us and we have treated it as such.

Although much of what we consume to repair guitars, mandos and b*njos has gone up in price with our business model of not stocking and selling all but essentials such as pots, bone, strings, etc. the impact on us has been minimal and what we refer to in our shop as mouse nuts....

We have raised our prices but were in no hurry to do so since we frequently revisit our pricing anyway.

Our business is doing better than ever and we turn away around one out of two instruments that come our way for various reasons such as the economics of paying for the repair not being present for the client or it's simply something we don't want to do.

Our business model also is very much dependent on somethings that I learned in corporate America such as be #1 or #2 in all that we do or hang it up and go sell patio furniture out on route 36 as Tony Soprano used to say RIP. Because our reputation in our area is stellar we can pretty much call our own shots.

We also believe in never attempting to be all things to all folks. If you want a repair that we don't do or like to do or is not profitable for us we will refer you elsewhere and decline. The survival of the business must be as important as our own survival and that's how we view it.

Lutherie business are on the cusp of death as it is with rising inflation and a new, throw away society that pitches things when one is tired of them instead of preserving value. So we have to be sharp and efficient and again because of our selectiveness in what we agree to work on and how we view ourselves as private contractors and not a public space or store we end up doing very, very well AND can comfortably provide the highest quality work consistently without ever worrying about the small stuff such as more time here and less time there.

So long story short inflation has had very little impact on us but it is costing our clients a bit more and we have to pass this on if we wish to play another day.

When I was in high school I worked on a night crew in a Kroger store. Sunday's were price change night and when prices went up we also changed the prices on the things on the shelves that the store purchased at a lower price. With all this said passing price or cost increases to clients is how it's always been done and we do it as well.

Because what we personally consume is more expensive we have raised our prices about 7% in some cases and a bit more in other cases. They keep coming though and I just got back from working Sunday morning because I had nine guitars waiting for me this AM. We are that busy and it's our birthday too Did four and will pick up the rest tomorrow.

with everything going up I did have to raise prices , now with Baltic birch no longer available I did have to find other materials. Insurance rates when sky hi but found new insurances.
Electric bills went up. So now with all this I am thinking just how much longer can we do this. I still do well on repairs but the fixtures are less profitable than a year ago. Hoping things will roll back soon

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John Hall
blues creek guitars
Authorized CF Martin Repair
Co President of ASIA
You Don't know what you don't know until you know it

Not to high-jack but our insurance went way up too and I heard rumors that other people's did as well. We are with Heritage and have two policies, the Luthier policy and a store policy since we had to insure the building for $2M. One of our's went way up and Heritage stepped right up without me even having to complain and they found us a comparable policy with a new underwriter for a small amount more. I just paid that bill this morning as a matter of fact.

So we stayed with Heritage John are you with Heritage too and did they find you a new policy with better pricing?

Again sorry for the high-jack I'll stifle myself now

heritage for me a great insurance company. Erie business went to over 2000 my new policy with the same coverage was 1000

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John Hall
blues creek guitars
Authorized CF Martin Repair
Co President of ASIA
You Don't know what you don't know until you know it

I hadn't thought about Baltic Birch in the current situation. Bummer, but so it goes.

Dave

Many cabinet shops have substituted Appleply for Baltic Birch because it is very similar, cheaper, and comes in 4X8 sheets. That it is made in Oregon may be an added benefit in the current situation. I've used it for the past dozen years and haven't noticed any problems with it. A brief article that explains it better than I can:
https://craftgecko.com/appleply-vs-balt ... d-you-use/

It hasn’t really affected our repair business because basically the repairs we do are usually 95% labor.


Sent from my iPhone using Tapatalk

Cost of nitro here has risen around 40% in the past three years, to the point where material costs have actually become a major factor in the costs of finish work. Started getting some pushback from clients on the last couple of respray jobs I bid on.

All the other consumables, sandpaper, solvents, tape, are up too but not to the point it really moves the needle. The rest of the repair work I do is 90% labor and so a minor adjustment in hourly rate levels things out.

apply ply is out of this world in cost I can't find it here

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John Hall
blues creek guitars
Authorized CF Martin Repair
Co President of ASIA
You Don't know what you don't know until you know it

I don't know about the rest of you but beyond shop supplies and materials - if my personal cost of living goes up 50%, then my prices have to follow. Still gotta keep the lights on and the shop heated or cooled as well as food on the table.

Just as scary as price increases is the unavailability of products we use including tools. I'm seeing "Not in stock, no BO" more than ever.

Kind of hard to predict where or when this cycle will end. If vendors find we are all willing to pay higher prices they might not come back down.

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Brian R, Wood Mechanic
N8ZED

This is a very good point and it also speaks to really understanding our true costs. If our cost of living goes up so too should our prices I completely agree.

For those who's primary business is doing repairs it has to make economic sense to be in this business.

When money gets thin, and the choice becomes between "fixing the car" or "fixing the guitar" the less necessary item might have to wait. It's nice to think that following inflation by raising prices is the answer, but that doesn't always work if what we do doesn't need to be done. Sometimes the answer is to tighten our belts and accept a -lower- standard of living.
Since retiring and joining the "Fat Lazy American" demographic I have noticed a decline in my buying power only somewhat ameliorated by my wife's continued gainful employment. And since I am only driving about 10 miles a week now I dropped the insurance and detagged one of the "extra" vehicles - so we are down to three for two drivers (we could get by with one). I won't be buying that new $20,000 Canon 1200mm lens any time soon (especially since they basically just added a built-in 2X converter to a 600mm lens), but will continue to use a cheap 300mm Tamron and try to get a little closer to the birds. I watched a video where people were complaining about supply chain problems not allowing them to get the latest designer sneaker or gaming console.
My burdens have been light and my life has been easy. I count my blessings that I live in a "first world country", and not one that is being ripped apart by a senseless war. Things could get much worse for all of us, and what we are grousing about now, appear to be trivial in the future (hopefully this will not be the case).
There will be things that will become scarce and difficult to source at times, but if we can keep Food and Shelter off the list of "Unobtainium" for everyone on this side of the dirt, the rest might just be inconvenient. Globalization shouldn't be just a way for the rich to become richer.
Stepping off the soap box now......

That's a healthy viewpoint, Clay.

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Great post Clay on a lot of levels.

Sony guy here and I didn't know you were a birder too. I just read about that Cannon lens, wow lots of reach but pricy for sure.

Hi Hesh,
That's a cool photo! Was the Baldy near the crow's nest? I often see small birds harass larger raptors when they get too close to nests.
The Ospreys are nesting just over the hill from me, so I have been watching their progress and trying to relearn photography with the new digital ILC equipment - I studied photography back in the 70's film days.
Sony makes some great cameras and lenses. The new mirrorless cameras do so much more than the old film cameras - but you still need to find that perfect moment to take the picture.

love the photos guys. Dave

This was near the eagles nest and there were about 6 crows harassing the eagle. The eagle seems to care less though.

Yeah I got back into photography when covid hit and I took to the woods for a summer to avoid people. On my last day at the shop for 15 months I stopped at a camera store on the way home and $15K later I had some nice stuff including a Sony 62 MP camera, 600 mm lens and several other lens too. I had to relearn too and the biggest advance is the auto-focus which is amazing.

These cameras can track and lock onto the eye of a bird in flight now and automatically nail the focus. Unbelievable the processing power of these things these days.

It's been a lot of fun until I hurt myself again and my rig, camera and 600 mm lens is now too heavy for my hernia darn it so I am stuck doing macro shots of the orchids that I grow.

Dave Collins is a very good wildlife photographer and he goes into the UP and takes pics of bear and such.

Most of all though the digital stuff provides for more immediate gratification with no film developing needed.

Sorry for the high-jack Woodie and everyone else I'll stifle myself now.

Hesh and John, I see you mentioned Heritage. Have either of you ever made a claim with them? If not, good luck when you do. They were an absolute nightmare to deal with when we made our one and only claim with them and that was after being with them for several years.

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tim...
http://www.mcknightguitars.com

Hey Tim I hope you and Mary are doing great. I've been wondering how you are.

No we never made any claims but you know Ellis died recently of covid. It was very sad to hear.

We are on some other groups that are pro luthier only groups and heard rumors that Heritage rates were going up. I proactively called them because we renew this month every year and asked them if our premium was going up. Sure as shootin it was and without me even asking they stepped up, said the increase was BS and asked me for permission to shop our policy around.

We now have a new policy from Heritage with The Hartford as the underwriter and the price increase went from around 80% to 10% which was much better if we have to have an increase at all. We have a second policy from them (I like insurance...) for the building for a couple million and that did not go up at all.

Sorry to hear about the problems with making a claim that's not good to hear. The only information that I had about how they handle claims was when Howard (Klepper) was ripped off of two guitars and he said they stepped up nicely and quickly. That was over ten years ago. I don't get out much these days

We had a number of customers that had guitars damaged and repaired under policies brokered by Heritage (most often, touring musicians, but in one memorable repair, a well-intentioned housecleaner and an early Nick Lucas got crosswise). It may well be that the actual insurer influences the administration of the policy through the broker, but I do not recall any specific issues on claims beyond a requirement to provide the servicing agent with an estimate of the revised post-repair valuation of the instrument when submitting the repair cost estimate.

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A constellation only takes shape when one maps the whole.
- Beth Brower

I work alone in my shop at my residence, so inflation is somewhat softened by low overhead. Since inflation is on everyone's mind it is no surprise to my customers that my prices are up.
This may not make sense in the context of inflation, but I am "filtering off" work on lesser quality, cheap electric & acoustic guitars in order to carve out time for my guitar building, and repairs that are more interesting. Possibly I am making less money, but I am happier with what I am doing in the shop.

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Baltic birch was about $4 a br ft Apply ply is about $9
I found a product from Canada about $2.50 not as pretty baltic but will make a great substitute. Solid ply and made of aspen

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John Hall
blues creek guitars
Authorized CF Martin Repair
Co President of ASIA
You Don't know what you don't know until you know it