Where does Supply/Demand equalize? Suvive Year+ leadtimes

It is a bit of a gamble, but it's cool to be a small part of this company's success.
 
rockspyder said:
Guy apparently does good work. I can respect that. He also apparently doesn't want to work the bank/creditor business game. I can respect that, too. I just don't think I'm into giving any more interest- free loans. An investment implies a return. In return for my investment (an advancement in full on a knife I have zero guarantee on getting), I am getting... a knife. Typically, someone who "invests," has the POTENTIAL to receive several times their investment, or a continuing return on their investment. True, anyone who "invests" in Survive has the potential to get several times a return on their investment. But, only if the company (Guy) supplies a product that has a high demand (which Guy does), but the supply decreases, or stops (Guy goes out of business, for whatever reason). I don't want ill to fall to Guy. I don't know him, but what I know of him, he seems to be a reasonable person, sincere. So I don't want him to fail. But the money I spent to pre-order a knife can hardly be called an investment, because if he succeeds and starts to produce more and more knives, my knife decreases in value, therefore my return on investment is negative. If he fails, goes bankrupt, and produces no more knives, then my knife MAY appreciate in value, a net positive investment. As all "speculation," it is a gamble. But I didn't preorder a knife for speculation or investment. I ordered a knife to buy a knife. If I am waiting for a knife to be made because materials are being purchased and work is being performed that I paid in full in advance for, that isn't an investment, that is an interet-free business loan. Which again, is fine, if you want to be the creditor. I don't, so I don't plan to be again, ever, in the future.
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Clearly you've put serious thought into this, you make some good points. I think the bottom line is that you're not into preordering and you have every right not to be. I don't know if we'll get much out of discussing it further, though. I have faith that you'll get the knives you ordered and I hope you love them. I also hope you'll come back to share your thoughts on the product.
 
Oh I think I'll really like the knives, if not love them. The designs are, in my opinion, singularly brilliant in their simplicity. There is a maker that is, unfortunately, long departed, whose designs Guy's somewhat remind me of. I wholeheartedly admire the designs. It is simply the business model on which I have reservations.
 
While I can understand the Op's frustration. I personally have no problem with Guy's business model. Survive! Is a small company putting out a great product. Many knife makers do the same, they open their books, take orders and you get the knife apon completion. I ordered a Gso 5 last May and received it in September, if memory serves. No big deal to me. The big deal was I got a Gso 5 in an amazing steel, top notch heat treat and sweet sheath for $178!!!! For that price and quality, I have no problem waiting.

I ordered a Gso 12 and knew that I'd have to wait a year or so to receive it. Again, for great quality and price, I have no problem waiting. I could easily flip any of these knives for a profit but never will. Guy's knives are more available now than ever. Hopefully the company will grow to the point where stock will be available for immediate purchase.
 
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Waiting sucks. Always does.

But I'm not sure if the demand would sustain itself long term if Guy were to add hardware to increase production to the levels of the initial demand.

The business model is what it is, and Guy is not the first to have it. You pretty much have to accept it or just find what you want on the secondary market.
 
Iv talked to Guy personally several times and he strikes me as very High Integrity, skill, and commitment. I want him succeed more then anyone, and I am not just saying that because I currently have multiple pre-orders with him.
That said, it is the continual growing length of lead-times over past several years that has my concerned. Concerned where it stabilizes. Why do I care? well aside from the obvious question of not knowing if 8 months is going to turn into 13 months I know this is all done with capital Up front before materials are even purchased. Yes, you could look at like we are investment capitalists with zero interest loans.. similar to how Kick starter funded projects work. That is of no concern to me. It is the lack of the lead-times supply/demand to have found a equilibrium point that has me concerned. Why does that have me concerned? Because I know as a businessman it is that lack of stability that can kill a company. For example, taking in a Year of Capital before product material is even purchased - that can be a recipe for disaster, ending up in perpetual debt cycle that grows.. Effectively, the growing lead-times when you have capital up front without material even having been purchased lead to an effective growing debt.. and yea, that has me concerned as someone who is vested in the long term of Survive!
 
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rockspyder said:
Guy apparently does good work. I can respect that. He also apparently doesn't want to work the bank/creditor business game. I can respect that, too. I just don't think I'm into giving any more interest- free loans. An investment implies a return. In return for my investment (an advancement in full on a knife I have zero guarantee on getting), I am getting... a knife. Typically, someone who "invests," has the POTENTIAL to receive several times their investment, or a continuing return on their investment. True, anyone who "invests" in Survive has the potential to get several times a return on their investment. But, only if the company (Guy) supplies a product that has a high demand (which Guy does), but the supply decreases, or stops (Guy goes out of business, for whatever reason). I don't want ill to fall to Guy. I don't know him, but what I know of him, he seems to be a reasonable person, sincere. So I don't want him to fail. But the money I spent to pre-order a knife can hardly be called an investment, because if he succeeds and starts to produce more and more knives, my knife decreases in value, therefore my return on investment is negative. If he fails, goes bankrupt, and produces no more knives, then my knife MAY appreciate in value, a net positive investment. As all "speculation," it is a gamble. But I didn't preorder a knife for speculation or investment. I ordered a knife to buy a knife. If I am waiting for a knife to be made because materials are being purchased and work is being performed that I paid in full in advance for, that isn't an investment, that is an interet-free business loan. Which again, is fine, if you want to be the creditor. I don't, so I don't plan to be again, ever, in the future.
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I want to point out that it is not an interest free loan that you are providing S! when pre ordering a knife. The price of the knife is discounted with free upgrades. Here lies the interest that you are being paid by S! for the loan. Each of your other points are valid, and each of us have to make our decisions based on our own risk tolerance. I just hope Guy eats healthier than Sky and limits the bacon.
 
McVeyMac said:
I want to point out that it is not an interest free loan that you are providing S! when pre ordering a knife. The price of the knife is discounted with free upgrades. Here lies the interest that you are being paid by S! for the loan. Each of your other points are valid, and each of us have to make our decisions based on our own risk tolerance. I just hope Guy eats healthier than Sky and limits the bacon.
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That part I didn't realize. About either of the knives I have on order. Well, I did get the fire-steel notch upgrade, free, on the 4.1. So there is that. I didn't know the price of the knife was actually discounted. And I thought the 5.1 that I ordered when they came up on here for order, not pre-order, was the same price as the preorder, but I guess I was mistaken.
 
I would guess much of the waiting for knives to be completed has to do with the scales and sheathes being made for Guy. He also has to send the blades to Peters for heat treating. If this was all done in house, production would be increased. This would also be a significant investment for Guy.

As I have stated before, waiting is no deal breaker for me. Seems I'm always waiting for my next Busse to arrive. My Randall was ordered in 2012, hopefully I get it in 2017. Besides, I couldn't find another knife with all qualities the the Gso 5 had for under $180.
 
We all agree the wait is excruciating. I think the reason we feel like this is because of what we're getting. Would you invest $50 on a Buck knife and wait a year. Most likely not. Those of us who did do the pre order did it knowing (no matter how minuscule) that we would receive an excellent product in the end. If we didn't believe in S! we would not have invested our time and money. Deep down we all know Guy will produce every blade to the high quality standards he has shown us in the past, and do so at the fastest pace humanly possible.
 
There are a lot of intelligent posts on this thread made by people who obviously have a firm grasp of economics and how to run a small business. It is great to see this conversation taking place in a respectful manner, and I really appreciate all the different perspectives that have been voiced here.

My decision to deal with S!K is based on my appreciation for the amazing design and quality of the product. I also REALLY like that Guy and Ellie are intimately involved with the company and actually touch EVERY knife. S!K is obviously their baby and they are doing things differently than most. That appeals to me. S!K could limit demand and make more money by increasing their prices. It is my understanding that S!K doesn't want to do that. They could also get an investor / loan and hire people to make knives, but they don't want to do that either. Is their business model different and inefficient? Somewhat. But, I respect and appreciate S!Ks values. I think that some of the reasons that their knives are so awesome is the fact they are doing things differently. Yes, dealing with S!K is risky and inconvenient. But it is well worth it to me. Others might feel differently, and that is totally cool.
 
Sorry for harping on it but it just blew my mind that I got my Gso 5 for under $180. A similar knife, by a rival company goes for around $230. I couldn't believe the Gso 12 was under $400. Guy really is trying to give his consumers a great product at a pretty sweet price.

I've been watching this knife company since almost its inception and have seen it slowly progress. I think Survive Knives best years are in front of it. Hopefully supply will meet demand in the next few years.
 
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In an ironic twist on this subject.. The long wait times and non-existance of off on-shelf inventory make the knives extremely valuable. Survive knives currently have an ever increasing value in secondary markets. The now go for significantly more used then new.. I have noticed fewer and fewer going up for sale on Ebay.. Which makes sense, who in their right mind would wait a year to get a knife and sell it for 20$ profit? I woudln't part with my knives for double what I paid!
Every-time I see one go up for sale on Ebay I imagine a sad backstory.. there is someone very hard up for money.. or a very POed spouse. ha..
 
DJC72 said:
Sorry for harping on it but it just blew my mind that I got my Gso 5 for under $180. A similar knife, by a rival company goes for around $230. I couldn't believe the Gso 12 was under $400. Guy really is trying to give his consumers a great product at a pretty sweet price.

I've been watching this knife company since almost its inception and have seen it slowly progress. I think Survive Knives best years are in front of it. Hopefully supply will meet demand in the next few years.
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Right on, my man. I seriously felt guilty for how little I paid for my GSO 5 factory second. What I paid probably covered the steel and some of the labor with the handles and sheath being free. There may be other price reductions, but with the new models, Guy dropped the price of the GSO 10 by $50. That is insane. Please charge enough to be able to buy groceries and put gas in your truck.


mlmcasual said:
In an ironic twist on this subject.. The long wait times and non-existance of off on-shelf inventory make the knives extremely valuable. Survive knives currently have an ever increasing value in secondary markets. The now go for significantly more used then new.. I have noticed fewer and fewer going up for sale on Ebay.. Which makes sense, who in their right mind would wait a year to get a knife and sell it for 20$ profit? I woudln't part with my knives for double what I paid!
Every-time I see one go up for sale on Ebay I imagine a sad backstory.. there is someone very hard up for money.. or a very POed spouse. ha..
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We have some serious investors here :D
My thought process is more like: Oh I really like that knife, here's my money.

You are a better person than I am. Anytime I see a GSO for $500 I think "what a jackass gouging the price because he knows he can".
 
Oh man, let me refill the tea and settle in for this one. I feel like I could quote every post here and reply with at least a paragraph each. I will try to keep it shorter than that.

First thing first: Someone mentioned the respectful manner in which this was being discussed. Unlike some past threads, I never felt attacked while reading through these posts this morning. Thank you, so much, for that. Seriously. Thank you!

Where will supply/demand equalize?
The magic question that we have no answer for. Demand has been growing faster than we can keep production running. It seems like the larger the run is, the faster it sells out. Some supply issues in the past were due to a high rate of Factory 2nds which we tried to get refinished, when we probably should have just sold them at a discount. Guy never wanted to sell Factory 2nds though, he would prefer to scrap them. Trying to fix them was costly in terms of time, and many of them were still sold as Factory 2nds. The Starter helped us solve that problem by allowing us to purchase the equipment to do the finishing ourselves. We now have less 2nds because we are doing the work ourselves. Only time will tell on this one. We have a plan for the future that I will discuss more at the end of this post.

Why charge for the preorders up front?
It would take a lot of time away from fulfilling orders. No matter what, production takes time. Our credit card processor will not hold on to card information long enough to automatically charge cards once the knife ships. That means someone has to go through hundreds to thousands of orders to get in touch with each customer to collect payment before shipping the knife. I assume that if we didn't charge up front there would be a lot more orders (a bonus of charging before is a lower demand). As mentioned, a lot can happen in a year. How many of those orders would get made and then the person doesn't have the funds anymore or can't be reached? Then we've built a semi-custom knife that has to be taken apart before reselling it. Sell it as is? Ok, then we have to make a new product page for it, sort through other orders to find the one that fits those specs. I get anxiety just thinking about the messiness here.

So why even bother offering preordering?
It means we can make more knives, more quickly. The production runs vary between $30,000 and $80,000 each, depending on the size of the knife and how many are being made. That doesn't include fixed costs. We could have kept on going without preorder funds but it would have been only one or two models in production at a time, a process which takes months. Now that the first run of new production is done and all the little bugs have been sorted out, we will be able to keep things flowing through the process much more efficiently.

Why not bank or private investor funds?
Private investors are terrifying. In 2013, Guy brought in a partner. The hand-shake style deal was a percentage of the company in exchange for investment money and business management. The rest of that story could be made into a movie. The short version: no money appeared, the business was pulled in too many directions. Even legitimate investors want to come in and make decisions. The ones we've talked with lack manufacturing experience and focus on how to increase sales. As most of you know, that is the opposite of what we need. We know what our biggest inefficiencies are and are already taking steps to fix the issues there (see below).
When things went wrong with the partner the banks wouldn't go near us. SURVIVE! was too young. As a result, the year end numbers didn't look great. When 2014 brought production delays and Factory 2nds we were still digging out of the partner hole. As a result, the year end numbers didn't look great. We have learned that banks don't care that you're always sold out, there is steel waiting to be cut, customers are loyal or anything to do with potential. They look at numbers. I've probably said too much already so I will leave this at that.

Why does it take SO long?
We use vendors that are exceptional and what they do. They have other customers.
Each model has its own set of molds, forms, cut files, jigs, etc. You can't do two models at a time. This may sound like a "duh" to most BladeForums folks but if you aren't familiar with manufacturing it may not be that opbvious.
We started a new way of doing things and it has taken time for everyone to adjust. It may not seem like it yet, but in addition to creating a much nicer product the new process is more streamlined. Things will speed up now that everything has been figured out. Once the first run is done of each model, following runs will be much faster since there won't be the extra time for setting up.

What is SURVIVE! doing about it all?
As mentioned elsewhere, we are changing our business method a bit for 2016. I was planning to release a newsletter with details once we were done with the Christmas rush. With this thread popping up, now seems as good a time as any.

The "pick two" concept as been brought up a lot lately. We will not lower quality, this includes the fact that Guy will not hand over sharpening unless he has full confidence in his replacement. The price is a reflection of our costs. We don't believe customers should have to prove how badly they want the knife by paying more for it. We don't believe it is right to charge more just to lower demand. Our 2 have been picked. No matter what there will still be some waiting. However, we have a plan to making the waiting a little less painful for everyone.

As the preorders finish up for each model there will be no more listing everything we have and estimating shipping deadlines based on how the machines and Guy have been running. Instead, Guy will be sharpening the blades before they are listed for sale. Every Monday we will list what has been sharpened the week before. They will get built on Tuesday and Wednesday, then packed and shipped Thursday and Friday. Some customers are overseas or work night shifts, so the knives will be listed at different times of the day on Mondays to keep things fair. We have removed options that reduce Guy's efficiency. We will continue the 1st Friday updates and use the Production Schedule page to keep people informed about what models will be available each week. There will still be a wait for availability and we will likely sell out every Monday. But once your order is in the waiting is nearly over. You will have a tracking number from us later that same week. Some nearby folks may even get their order within the week.

We are expecting hate mail. But we get hate mail no matter what we do. It comes in the form of phone calls, emails, social media posts, forum rants. We have learned that no matter what we do we are going to be told why it is wrong. So we are going to start doing what is right for us. In the past, we list knives, sell out, then fight to catch up on hundreds of orders. It is a fight that never ends. It is overwhelming. We feel guilty for taking days off, angry when machines break down, defensive when customers ask what is taking so long (a question which I know is totally valid). We are choosing to take back a bit of our lives. As I said already, there will still be a wait for availability and we will likely sell out every Monday. But the weight of hundreds of orders will not be resting on Guy's shoulders. He will be able to go back to sharpening because he wants people to enjoy a quality tool, rather than feeling like he is just trying to bail water out of a row boat with a hole in the bottom. Which means he should be much more effective and we will actually be able to increase our output.

Ellie out.
 
You and Guy are doing fine. You produce amazingly designed and built knives, provide great customer service, and are as friendly and transparent as any knife company I have ever seen. Keep up the good work and don't get frustrated. There are a lot of folks like me that like what you are doing.
 
While I was squarely in the "not worried about it" camp, I applaud the response, and think that anything you guys can do to stay in business while actually having a life is a plus in my book. The fact that you can't please everyone is a deterrent that keeps a lot of people from trying to do what you all are doing, it takes courage and confidence to try.

Cheers!!
 
redwood22 said:
While I was squarely in the "not worried about it" camp, I applaud the response, and think that anything you guys can do to stay in business while actually having a life is a plus in my book. The fact that you can't please everyone is a deterrent that keeps a lot of people from trying to do what you all are doing, it takes courage and confidence to try.

Cheers!!
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WHAT HE SAID!

I see it this way... NO ONE can truely say a thing until they have tried to open a cutlery company and break into a highly competetive industry like you guys have!

Stay positive. Take pride in what you guys are doing. The demand is the #1 indicator that you are on the right track. Keep making a great product. I will keep buying them.
 
I think I'm right around $1k in preorders right now.

I'm not upset about the delivery time at all, I knew what I was signing up for when I put in my payment info.

I'm just hoping the 4.5 gets added to the production list next ;)
 
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