Reply #39: We are going to lose our ass over this thing, and it's all gonna be fuel [View All]

[jmowreader]

I know what Nardelli's doing down there now. I asked.

Nardelli took an entourage with him--the lumber global product merchant (GPM), the building materials GPM, the flooring GPM and the millwork GPM. A Global Product Merchant is a cross between a head buyer and a departmental vice president. They went down to estimate the amount of product--specifically, dimensional lumber, 7/16" OSB, 15/32" CDX plywood and all subfloor products, siding, any roofing and insulation products, all kinds of flooring materials, plus windows, doors and moulding--we're going to have to send to the Katrina area.

Because of the size and scope of this disaster, we're going to have to pull materials not only from stores and distribution centers, plus manufacturers' warehouses, but from foreign countries as well. The people in Louisiana and Mississippi are going to learn about 12mm plywood and metric-size shingles the hard way. (However, they are gonna be installing some pretty roof decks, man; that European plywood is fantastic!)

All's well and good so far. We can call Han Zhang Lumber in Shanghai, China, Canfor in British Columbia, or Sodra in Monsteras, Sweden, and just clean them out. No one else in the world is gonna be building shit for the next two years, but we can get the materials.

Now throw in our absolute no-gouging policy. We do not and will not raise the price of materials during natural disasters. Which means that we are probably going to buy plywood for $10 per sheet, stick a buck and a half worth of fuel to get it from Germany to Louisiana, drop it on the floor and put a $10.95 price tag on it. Do the math: losing 55 cents per sheet on each of the 29 million sheets of plywood we'll sell during this disaster means we made HOW much money?

And besides, the products you need to recover from a hurricane have very little markup on them even in quiet times.