The Quarterly Messick's Report

[Cahaba Valley Farm]

 

[Hay Dude]

I would think Messicks themselves would be forced to pass a pretty substantial price increase along to their customers with the new facility they built. I was just there. It’s HUGE

 

[Cahaba Valley Farm]

I would think Messicks themselves would be forced to pass a pretty substantial price increase along to their customers with the new facility they built. I was just there. It’s HUGE

Yeah he left that part out didn't he

 

[5030]

Usually, the bigger they are, the harder they fall.

 

[Milo]

I would think Messicks themselves would be forced to pass a pretty substantial price increase along to their customers with the new facility they built. I was just there. It’s HUGE

I would not expect that at all, the idea behind expanding their operation is to gain efficiency in sales, service, parts, inventory management, etc. Most of the cost is deductible.

 

[Hay Dude]

I bet that new place cost 10 million

 

[Milo]

You were there so I imagine you're right. Did this new facility replace a smaller, dated place or is it an additional facility?

 

[Hay Dude]

You were there so I imagine you're right. Did this new facility replace a smaller, dated place or is it an additional facility?

The old place was really big. Didn’t seem that dated to me.
The new place dwarfs the old place and is much more modern.
I dont begrudge Messicks. I buy stuff from them all the time and they have done some significant repairs for me, too.

 

[Snobdds]

Usually, the bigger they are, the harder they fall.

Quite the opposite, actually.

Companies that get a place that big, turn into a clearing house for a lot of companies and their ancillaries. So much so that they turn into, to big to fail. Kubota probably floor plans their inventory, instead of private capital, and as long it moves product...they can operate at marginal cost instead of marginal revenue with economies of scale.

It just means the high volume sales can subsidize the low volume products and still be profitable.

 

[Milo]

What I was trying to determine is if they will they be selling (or have sold) the old property and applying the proceeds towards the new facility? Or is this in a different market area and they plan to keep both?