Article contributed by Mike Berman, COO, Day & Nite/All Service, with Eric Trude
Even semi-active investors follow buy low, sell high strategies as proven if occasionally elusive fundamentals. But the driving forces behind natural buy low-sell high need not be limited to picking stocks, investing in real estate or other pure wealth creating activities. When expanded, buy low, sell high represents the soundest means and methods for running many aspects of your business.
Building on last week’s DIKM column getting a most successful jump on what promises to be a pivotal new year for hospitality by employing buy low-sell high will be critical. Although we are experiencing Covid-19’s darkest days, anticipating this holiday season will be further disrupted by rolling shut downs, quarantines and the probability the national healthcare crisis will further spike early in 2021 it seems reasonable to project we are perched either at or very close to absolute rock bottom.
In other words, buy low conditions. The severe economic toll endured by all hospitality segments has been particularly brutal on the industry’s downstream supply chain, eloquently expressed by Top Chef and Independent Restaurant Coalition founding member Tom Colicchio. It only stands to reason that equipment and parts manufacturers would suffer from built-up inventories of unsold product on one hand and have curtailed manufacturing on the other hand. For obvious reasons global trade wars, the impact of tariffs, has faded from the headlines but these barriers very much remain intact with all indicators suggesting they will not be relaxed or removed anytime soon, even after January 20th. Forecasting in these most uncertain times carries considerable risk; production conservatism is most sensible.
Vaccines and other advancements like bi-polar air ionization’s effectiveness are bright lights at the end of this narrowing harrowing tunnel and unless we have lost all sense of optimism, as bleak as the immediate weeks may be consensus estimates is the new future will start to unfold in March. For this we must then blend proven buy low, sell high fundamentals with the primary recurring fundamental of this weekly column: smart, engaged proactive management. A likely lack of readily available parts and product to meet increasing demand once circumstances start turning for the normalized better is only a small portion of serious supply chain challenges foodservice will face during the inevitable upswing.
Even before coronavirus shattered our world, the installation, maintenance, and repair field suffered from a shortage of capable technicians. In a phrase, there isn’t nearly enough skilled labor capacity on the planet to meet a surge in demand for an avalanche of simultaneous reactivations, preventative maintenance visits and emergency repairs in a condensed timeframe. Certainly not anywhere near the human suffering toll, visualize similar stresses on the equipment service sector healthcare professionals are experiencing treating record numbers of Covid-19 patients.
Accordingly, buying low and selling high means taking the initiative to schedule your preventative maintenances between December and February, installing the right technologies to ensure maximum indoor environmental hygiene and food safety during this timeframe, repairing all equipment ahead of the anticipated avalanche when access and availability most favors you and avoiding inevitable cost increases when the supply and demand equation inevitably flips back the other way. As always, the Day & Nite family of companies practices proven fundamentals in all aspects of its business. To best serve hospitality, to ensure you proactively and most economically turn the corner on this dismal year and are best positioned to flourish in an economic rebound the company has invested in resources from technologies to talent to stock so that you can best take advantage of these crucial early thru mid-winter months.
No less important is during this season of giving 5% of all new Day & Nite/All Service/Popular Plumbing new preventative maintenance contracts will be donated in your name to the noble James Beard Open For Good campaign. Proactively manage your business, heed the soundness of buy low-sell high principles and give back to our industry by sending an email to jbf@wearetheone.com.
