Shopsmith's new website is up....

[JPG]

In my case the 950k was derived by my subtracting his 50k fee from the 1m raised. I do not recall any other reference prior to that post.

[RFGuy]

Inflation, which is the rate of price increase on an aggregate group of products, is getting back to "normal" which is around 2-3%. Since it had ticked up and peaked at around June 2022, it is now retreating back to normal, which means many prices that had inflated are now deflating - otherwise the inflation rate would not be returning to normal as it is an aggregate of many product prices.

The first part of what you posted here is true. The latter part, saying that at an inflation rate of 2-3% means that prices are going back down, hence deflation, is not correct. Deflation means that the "inflation rate" is actually negative, i.e. <0%. Since rates are at 2-3%, this means that the aggregate group of products and services is still going up in price, but just at a rate that the Fed uses as their general target.

Adrian,

I wasn't talking the textbook definition of deflation as applied to the entire marketplace, but rather a sub-group of products dropping in price. You know how inflation is calculated, right? The gov't uses several indices, but since we are talking about a consumer product here (Shopsmith namely), I am referencing more of the CPI and PPI components of the inflation rate calculation. These are aggregated numbers meaning there are specific companies and products chosen to give a composite image of the entire US economy. You can have an inflation rate of 2-3% meaning that across this composite image of many products and companies some are increasing in price, some staying the same and some are actually decreasing (deflating) in price. Since the inflation rate is returning to the more normal 2-3% now from what it was last year, there are likely many products decreasing in price recently, i.e. back to where their price points were before it started inflating. This is my simplistic view of it, but accurate in my opinion. You would have to be an expert economist to give a more granular detail on what is actually happening in the macroeconomic world beyond my description here.

[adrianpglover]

I know this data is rather old (~19 years ago), but 950k or even 1M does seem a bit low considering their sales figures from 2005. https://last10k.com/sec-filings/ssmh According to the filing, net sales were at $13.359M for the year. This again is for the prior incarnation of the company, before RLF Shop, but I don't think the company has decreased by that much, unless during the reorg they sold off a large portion of their assets and mfg and are currently only the customer facing portion of the company.

@RF Guy - Yes, some prices would come down with inflation coming back down to 2-3%, but that's going to be more driven by market competition. Another factor to think/talk about here is what products/services are getting cheaper over the longer term. I've seen a few of these charts over the years, but this one by Visual Capitalist is the one that I could find with the most recent pricing data. The data span is over 22 years (2000-2022) and shows that while things like medical, college, childcare, food, and housing have had pretty decent amount of total price increase (not just yearly inflation, but think of it more as yearly inflation compounded), things like cars, home furnishings, and clothing have stayed pretty flat, things like cell phones, software, toys, and tvs have dropped significantly over that period. This doesn't show what the chart would be like for woodworking tools as a whole, but it would be interesting to get the source data from the BLM and make our own charts for other industries. For my own interests, woodworking, cameras, and popup campers would be interesting to see, as there are other market forces at work in each of these interests of mine that have caused various pricing pressures over the years.

*** edit: forgot the link - https://www.visualcapitalist.com/inflat ... -services/

[RFGuy]

Adrian,

Thanks. Yeah, I agree with you. Is it just competition that causes prices to fall? I don't know. I mean if a manufacturer or even a warehouse/store operation that has falling demand (or oversupply) for whatever reason, they can't sit on inventory forever because of fixed costs like utilities, employee salaries, etc., etc. At some point they are going to have to lower prices or go out of business. Sure lowering the price will eat into any margin that they have and they might even have to sell it for a loss, but at some point it becomes inevitable unless demand rebounds. This is my worry with Shopsmith...I know we aren't supposed to share worries here. There is lots of competition in the woodworking tool machinery space and most of them are using offshore manufacturing with a cost advantage. However, the perception that I have of Shopsmith is they still think they have a monopoly because their machine is unique. IF my perception is true and they are raising prices because they think they can and expect demand will remain constant then I am worried for their future. I believe raising prices too much on their products will only accelerate their demise, which is not something that I want to see. For a long time, I loved my Shopsmith equipment and felt more connected to it because of nostalgia of working on a Mark V with my Dad when I started to learn woodworking. We both still use our respective Mark V's. Given what I detailed above, I only like my Shopsmith equipment now when I used to love it. One day, if and when it breaks, if the repair parts are perceived by me to be too expensive, I will have no qualms with offering up my equipment at a firesale for any takers and replacing it with a good quality cabinet TS, lathe and drill press in my small shop. I already know how I would do it and make it work in my small shop. Maybe I am unique, but if not, I really hope Shopsmith can figure this out because I don't think I am the only one that feels this way. I am a woodworker first and foremost, and secondly I am a Shopsmith equipment owner (priority in that order). When the latter starts to interfere with the former, I will remedy this situation as I described so that nothing interferes with my ability to create, build and make sawdust. End of Story.

[edma194]

We have seen prices for power tools fall for many years. Largely overseas manufacturing has produced lower prices, as it did across many industries, along with brand oriented marketing, and economic changes that created lots of construction, home remodeling. Shopsmiths haven't kept pace with those reductions in price over the years because they don't make disposable tools. The entry price for new Shopsmiths had long been high in comparison to the individual tools for each of it's functions. You can get a decent table saw or drill press or lathe for the initial price of a machine. That you can get all three of those functions and more for the same price is irrelevant, there aren't really equivalent single machines to a Shopsmith so their sales have been nothing like those for individual tools from DeWalt, Porter-Cable, or any number of other businesses with barely distinguishable products. Products that are mostly disposable at the lower end of the price range.

There really isn't an equivalent company to Shopsmith making similar tools that has endured over time. The price of a Shopsmith is limited by low demand and a high entry price. Now I may be wrong about this, but I don't think any Shopsmith customers like the high price of the machines, accessories, parts or consumables. We can conduct a poll if necessary to clear that up, but I think I'm ok making that assumption. I don't know how they have established prices in the past, or how they will do so in the future, but we are all probably in the same boat here, we either keep buying from them or turn elsewhere. This boat will either remain afloat of sink, and there's little more we can do about that other than continuing to represent the quality and value of the tool system. I always remember the quote from Clarence Darrow - "Lost causes are the only one worth fighting for". He was a fool. Plenty of causes are worth fighting for, fighting for the lost ones is just practice.

[RFGuy]

Ed,

Thanks. So, I understand, are you saying that the quality of a Mark V/7 and/or its accessories are on par with Powermatic, Jet, Grizzly, Laguna, etc.? I would agree that I would take my Mark V any day compared to a portable contractor TS, but in terms of quality I don't see my Mark V as being on the same level of build quality that I have seen with traditional woodworking machinery companies. Having looked at them up close in person. In terms of cost, I could get Jet or Grizzly separates of better quality than my Mark V for the cost of a new Mark 7. I don't think Shopsmith quality is what it once was, but maybe I am the only one that has this perception.

[adrianpglover]

For myself, I started woodworking with a loaned MKV 500 for about a year, then purchased a decent, but cheaply imported Grizzly cabinet base TS. Over the following 5 or so years I added an '80s Craftsman bandsaw that shook like crazy but was given to me, a cheap craisglist Craftsman benchtop drill press, a '60s RAS from my uncle, and other tools. When I got the MK7, as a present from my wife because, as she said, "you'll never buy it for yourself", I then sold my drill press, and RAS. I later replaced the bandsaw with the SS bandsaw, as I wanted to reduce the footprint (and frustration) with the replacement. On the quality side of things, I'd say that the MK7 came with mostly similar quality as my TS, but the SS planer didn't as the packaging was horrible for the weight of the tool. The packaging completely missed on keeping the tool from moving around and it came with the table all kinds of out of sync and the box was all busted up. What helped with the MK7 is that it came on a pallet. The planer came in a box delivered by either FedEx or UPS, and I think they moved it around some by rolling the box. Also, I've had other quality issues with the aluminum castings, which make for a lighter weight tool, giving way, whether it be a crack on the tool rest arm, a set screw in the way tube tie bar that holds the way tube in place stripping threads under light pressure, etc. I understand the original design was for aluminum on it, but I think using steel or some alloy would make for a higher quality product.

What I don't understand about SS pricing, SPT pricing. By purchasing one instead of some other brand's benchtop version (to get past the footprint discussion), you're buying everything on the other brand's version, but without the motor, yet the price is soooo much higher. I do get it that SS doesn't have much of a market share, but if they want to become competetive, then they need to make it look like you can have a high entry price into the system, but then the accessories that give you more abilities need to be priced at a lower point than equivalent models from other brands. Maybe they want to compare themselves to higher end brands. If so, they need to make sure their products have the specs to compare as well. It just seems like they've got what was competitive in the late '70s or early '80s, and trying to say it's competitive on specs in the 2020s as well.

Back to the main topic...the website could still use quite a bit of work. The current status of it make this seem more like a small organization with a volunteer workforce like a church, scout troop, or the like, decided it was good enough for a launch.

[DLB]

I know this data is rather old (~19 years ago), but 950k or even 1M does seem a bit low considering their sales figures from 2005. https://last10k.com/sec-filings/ssmh According to the filing, net sales were at $13.359M for the year. This again is for the prior incarnation of the company, before RLF Shop, but I don't think the company has decreased by that much, unless during the reorg they sold off a large portion of their assets and mfg and are currently only the customer facing portion of the company.

2005 was still a pretty good time at Shopsmith Inc., which went bankrupt in 2009 and reorganized as RLF. For example, I've seen loads of used "50th Anniversary" Mark V's on the market, and they took some liberty with that labeling but most seem to be from 2003 to 2005. I'd say I've seen far more used MV's from that small time span than I have seen MV and M7 combined from 2005 to present. Which suggests that some point in time saw a major drop off in Mark production. That's in addition to the closing of retail stores, eliminating numerous products, etc. that have occurred mostly after the transition. My perception of RLF is that their focus has been on the existing customer base: upgrades, replacements, parts, accessories, consumables, etc., so not a company likely to thrive and expand but nothing in that suggests an approach that cannot be successful. (Depending on how one measures success.)

Note - IIUC M7 and PP were both introduced to the market in the RLF era, so that is two major new products. But to me the timing suggests that they were developed primarily by Shopsmith Inc.

- David

[adrianpglover]

I had seen it mentioned that one of the driving factors of the bankruptcy was the development of the PP itself. I don't have any sources for this though. I probably read it here on these forums.

[RFGuy]

What I don't understand about SS pricing, SPT pricing. By purchasing one instead of some other brand's benchtop version (to get past the footprint discussion), you're buying everything on the other brand's version, but without the motor, yet the price is soooo much higher. I do get it that SS doesn't have much of a market share, but if they want to become competetive, then they need to make it look like you can have a high entry price into the system, but then the accessories that give you more abilities need to be priced at a lower point than equivalent models from other brands. Maybe they want to compare themselves to higher end brands. If so, they need to make sure their products have the specs to compare as well. It just seems like they've got what was competitive in the late '70s or early '80s, and trying to say it's competitive on specs in the 2020s as well.

Adrian,

Exactly. I couldn't agree more. Yes, if it was a well organized and updated system with a high initial cost for the base platform and high quality then I could understand, but ONLY if the SPT's and accessories were reasonable in cost. The fact that the SPT's (no motor) are often as expensive or more expensive than good quality standalone tools (with expensive motors) from other brands is unfathomable to me. Difficult to justify the price for performance of Shopsmith equipment compared to what is readily available in the market today. I was naive and in the dark on competing tool brands for years because I considered myself a Shopsmith guy, but when I started to seriously look into other brands I started to wake up. Not saying Shopsmith isn't good quality, because generally it is, but most of the competition is also good quality these days but cheaper. What you do get with Shopsmith is a system, albeit a shrinking system these days as they end of life particular SPT's.

Yeah, I had all of the same problems as you describe with Shopsmith packing and shipping on a few orders. They seem to be clueless and will throw a heavy item in with a single piece of paper as "padding". Often putting more delicate items from the order in the same box and expect Fedex to gently deliver it to your door. Hah!!!