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PostPosted: Sun Sep 02, 2012 12:45 pm 
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gotta say i agree with reuben here. no disrespect to OP but like we know, its a buyers market right now with everything, so if everyones having to tighten thier belts.

coupled with this being a 'green' business, which imo (no facts to back this up) are always very expensive as it tends to be the wealthy that can 'afford' to go green.

solar and pv companies come to mind here, only staying afloat due to govt. subsidy. one of my best mates left british gas and went into renewable energy about 6/7 years ago and has had a crappy time of things, especially of late where the subsidies have been cut again. he's now becoming unemployed for the 4/5 time in that period.

ive stuck with the not so green company and the worst ive seen has been a pay freeze this year, the first time ive not had an annual rise in 15 years.


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PostPosted: Sun Sep 02, 2012 12:45 pm 
retrobike rider
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I was trying to find out whether our competitors were doing anything illegal - I understood that selling below cost i.e. buying the business, over a long period of time was effectively illegal - remember the Shimano vs Suntour legal battle in early 90's?

Personally I don't think it is competitive, before they started doing this, the other companies were all getting a slice of the pie as it were, and everyone was making decent money. Now one company is getting a lot of work at a negative profit margin, while no one else can compete! Bearing in mind some of the other companies are multi million pound, multi nationals, it's quite alarming. It's also worth considering that the quality of their work is shockingly bad, but money is king in construction at the moment and it seems cheapest wins the day. But as we all know cheapest is always best, and no one else can afford to beat them.


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PostPosted: Sun Sep 02, 2012 1:05 pm 
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If the only way to compete is to lower prices, then that's what you'll have to do. There are some buyers who will always appreciate quality, but they're getting fewer.
You say everyone had a "slice of the pie" and there was plenty to go round. What do you think attracted this multi-national to your sector?
You've obviously all had it easy for the last few years and have forgotten how to compete.
Welcome back to the real world.

On the positive side, they obviously see legs in green roofs, so if you can survive, in a couple of years you should be laughing.


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PostPosted: Sun Sep 02, 2012 1:16 pm 
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suburbanreuben wrote:
If the only way to compete is to lower prices, then that's what you'll have to do.


Making a loss on every transaction/contract is not running a business - that not even charity it's called a loss and it's a surefire way to go out of business.


If you have to loose money on each contract to just get the business then you surely cannot compete in the long term without either a massive injection of cash in the short term or the surefire knowledge you can ride out the crippling losses and make good the money in the long term (and even that requires your company to have the capital or credit to do so)


Now it's not illegal per se to run at a loss - hell many businesses don't turn a profit in the first 3 - 5 years after start up and have a bad year/2/3. However i'm not sure on the actual legalities of running all your competitors out of business intentionally by doing work at less than cost, forcing your competitors out then having the entire market to yourself (and being free to charge what you like)


http://en.wikipedia.org/wiki/Monopolistic_competition

and

http://en.wikipedia.org/wiki/Monopoly

its anti competitive practices - specifically predatory pricing. You need a business lawyer and an afternoon of Internet trawling really.

And
http://www.concurrences.com/anglais/dro ... ry-pricing


http://tutor2u.net/blog/index.php/busin ... y-pricing/


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PostPosted: Sun Sep 02, 2012 1:36 pm 
retrobike rider
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taffy wrote:
However i'm not sure on the actual legalities of running all your competitors out of business intentionally by doing work at less than cost, forcing your competitors out then having the entire market to yourself (and being free to charge what you like)


That's what I'm trying to find out!


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PostPosted: Sun Sep 02, 2012 1:38 pm 
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taffy wrote:
suburbanreuben wrote:
If the only way to compete is to lower prices, then that's what you'll have to do.


Making a loss on every transaction/contract is not running a business - that not even charity it's called a loss and it's a surefire way to go out of business.


If you have to loose money on each contract to just get the business then you surely cannot compete in the long term without either a massive injection of cash in the short term or the surefire knowledge you can ride out the crippling losses and make good the money in the long term (and even that requires your company to have the capital or credit to do so)


Obviously, they're not planning on running at a loss long term.read my posts above.


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PostPosted: Sun Sep 02, 2012 1:46 pm 
retrobike rider
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It's the less than cost bit that riles - it's not price cuts, or lower wages, we know how much their products cost and they are selling them for less than anyone can buy them for!


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PostPosted: Sun Sep 02, 2012 6:01 pm 
retrobike rider / Gold Trader
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suburbanreuben wrote:
Drewson wrote:
suburbanreuben wrote:
I'd imagine it's a pretty competetive sector with excess capacity at the best of times, being green and trendy and that.


I'd suggest that excess capacity in a market would reduce competition as their is less need to fight for market share, but this maybe a moot point...

Quote:
You may be thinking about it too much. It's not rocket science.
By overcapacity I mean there are too many contractors chasing too few clients. There is a recession on, even in the South East! If this has passed you by, then you're very lucky!


:lol: You're right...it's not rocket science. The excess or over capacity that you were referring to obviously is in relation to supply....but the same can apply to market demand.....obviously a misunderstanding. I've heard there is a recession on yup....it hasn't "passed me by" :wink: :D


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PostPosted: Mon Sep 03, 2012 8:16 am 
South East AEC
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I know who you are talking about !!


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