Grizzly's prices on some machines going up 25%

[Shiraz Balolia]

There is another thread relating to this issue, but it has multiple side tracks, topics and people talking about the trade war in general.

I would like to keep this thread strictly as it relates to Grizzly Industrial and prices that will be going up on July 6th due to the tariffs. Here are some key points to note:

1) 25% Tariffs are being imposed on most machines coming from China, and not Taiwan (regardless of whether China considers Taiwan as part of its territory, or not).

2) We have also been hit with numerous price increases for material costs that have gone up around the world and therefore our actual cost increase is much higher than the 25%.

3) Our prices, on the affected machines from China, will be going up on July 6th by a straight 25%.

4) An item that is IN STOCK and shipped before July 6th will be at the current price.

5) Any back ordered item, regardless of how long ago the order was placed, that comes in after July 6th will be charged the new higher price as we are unable to take a 25% hit. This tariff is beyond our control and we are being forced to increase prices.

6) If and when the tariffs are removed, on the date they rescind the tariffs, we will reduce all prices on the affected machines.

7) Although most machines from Taiwan are not affected by the 25% tariffs, they are still affected by the material costs and those machines will increase a modest amount, perhaps in the 5% range.

8) I strongly suggest that if you have been on the fence for a machine purchase, you do it before July 6th, 2018.

All in all, due to nature of our business model (selling direct to the consumer and not through dealers) we will still be cheaper than anyone else in the market place, even with the price increases.

Thank you for your understanding and for your continued support.

[Rod Sheridan]

Thanks for the information Shiraz................regards, Rod.

[Osvaldo Cristo]

I saw that story previously... although the new importation tax are on FCA cost they apply a flat price increase including on their local costs as well margins. Same story, different actors.

[Bert McMahan]

Which machines are going up? Is it all woodworking machines? I've been considering a lathe but was hoping to get into a new location before I actually bought it- I'm short on space :)

[Shiraz Balolia]

Which machines are going up? Is it all woodworking machines? I've been considering a lathe but was hoping to get into a new location before I actually bought it- I'm short on space :)

Yes, wood lathes will be going up. Most machines from China, except Tablesaws, I believe.

[Alex Zeller]

Can you give us an honest assessment on items on back order? Some people have been waiting for months with multiple dates given. The last date I was given was the first week of July. I know of others here who are also waiting. From what I understand a ship would have to be leaving China right about now to make a western port by the 6th. If the factory is still behind and will not be shipping until the beginning of next month will play directly into whether or not to cancel the back-order and pick a different in stock model. The wood lathes don't have a lot of overlap so changing models means accepting a different capacity. I can't speak for others but that's something I spent time deciding what's right for what I want and changing models will require some thought.

[Shiraz Balolia]

Can you give us an honest assessment on items on back order? Some people have been waiting for months with multiple dates given. The last date I was given was the first week of July. I know of others here who are also waiting. From what I understand a ship would have to be leaving China right about now to make a western port by the 6th. If the factory is still behind and will not be shipping until the beginning of next month will play directly into whether or not to cancel the back-order and pick a different in stock model. The wood lathes don't have a lot of overlap so changing models means accepting a different capacity. I can't speak for others but that's something I spent time deciding what's right for what I want and changing models will require some thought.

There are almost a dozen containers that will be arriving shortly and those that are in line waiting for them will get them shipped out as soon as they come in. Beyond that it would very difficult to pinpoint to the day when a particular back-order is going to arrive.

[Alex Zeller]

There are almost a dozen containers that will be arriving shortly and those that are in line waiting for them will get them shipped out as soon as they come in. Beyond that it would very difficult to pinpoint to the day when a particular back-order is going to arrive.

Thank you for the reply. I'm sure you are faced with a difficult position. On the one hand you're struggling to get equipment for potential customers and now this. Neither is something you can control. Hopefully my backorder is filled before the 6th.

[Mike Cutler]

Thank you for the honesty and candor. Many businesses would not be so upfront to consumers about the effects.
I would have to believe that everyone, and every business, effected by these tariffs, is hoping the situation can be negotiated and resolved prior to July 6th.

[Bill Dufour]

Does this tariff also apply to metal working machines such a milling machines? How about vises both wood and metal?
Bill D

[Bill Carey]

Thanks, Shiraz, for the straight forward post, and for splitting it off from that other thread. Hopefully, it won't be too long until you can get your prices back to normal (plus material increases).
Now, about that zero clearance insert I've been waiting for........................... :D

[David C. Roseman]

I saw that story previously... although the new importation tax are on FCA cost they apply a flat price increase including on their local costs as well margins. Same story, different actors.

Osvaldo, fair point, but we disagree on this. Sounds like you're saying Grizzly is trying to steal a march on its customers and turn the tariff announcement into a profit center. ;) We've yet to see how this plays out, but announcing a flat 25% increase in Grizzly's selling prices for the affected machines after July 6 strikes me as a reasonable response to an unsettled situation. It also gives a heads-up as to what customers can expect, absent deescalation of the current trade dust-ups. The U.S. Tariff Harmonization System is complex, but let's assume you are correct that the 25% tariff will be on FCA Free Carrier cost to a destination in China. We don't know what that cost is for any particular machine, but for certain it's by far the largest component of Grizzly's price to the consumer. Certain of the other cost components, e.g., insurance, may be tied to FCA as well, so will rise at the same time. Note also the OP's point #2, which I will take at face value, that worldwide increases in material costs mean that Grizzly's actual costs will be much higher than 25%. I'm also guessing that the new tariff schedules will cause a significant amount of market and internal operational disruption to importers like Grizzly that will need to be managed at considerable expense. Sure, Grizzly no doubt could develop algorithms in response to the various tariff announcements to calculate cost variables and make retail price adjustments more precisely. Theoretically, it could then adjust the price separately for each individual machine, part and accessory that it sells. But that itself would add more costs to recover.

[Mike Wilkins]

I wish more company leaders were as candid and straightforward with their customers as Mr. Balolia.
Not many Grizzly products in my shop but I will continue to shop from them.

[Tim M Tuttle]

Thanks for the info, Shiraz.

Where does the tariff money go?

[Nick Decker]

I don't know where the tariff money would go, but there's gonna be a lot of it.

[Rich Enders]

Hopefully it will go to reduce the considerable US debt. More likely it will go toward some new important expenditure.

[Rich Enders]

Bert, Per the thread started this past week-end, the tariff effective July 6 covers 800+ HTS codes. Besides woodworking it targets my world of plastics. Machinery such as injection, blow molding, extrusion, replacement parts for plastics machinery, plastic molds, mold bases for plastics molds, spare parts for plastic molds.........isopopes, aircraft tires, nuclear reactors and parts for nuclear reactors, many types of boilers, steam turbine for marine use, generators, aircraft turbo jets, concrete pumps, other pumps, refrigeration pumps,..........and on, and on.

Now also the USTR has published a preliminary list of 284 HTS codes to be considered for public discussion, and hearings toward a mid-September date for 25% tariff. This list includes all plastic resins, and virtually all types of fabrics, sheets, films etc.

Very troubling for business and eventually consumers over an issue about IP protection that is going to be settled by the WTO anyway.

[Rich Enders]

Alex,

We shipped a container Monday that was ordered in mid April. It was laden on board Monday, and the vessel departed Tuesday the 19th. The vessel has an ETA Seattle of July 6. The effective date is "arrival at a US port of entry", but we don't know yet if that is when the vessel arrives in port, or when the containers are actually off the ship and on the ground.

Rich

[Matt Day]

Guys, try to keep on topic per Shiraz’s request. As far as where the tax money will go, figure that out in the other thread.

Thanks for the post Shiraz.

[Jerome Stanek]

So how are you collecting the extra once the item before I get my back ordered item. I have already submitted my payment

[eugene thomas]

Every time I bought something from grizzly and on back order not charged me till item shipped.

[johnny means]

Wonder what this does to the used market.

[Jim Mackell]

I've bought several different machines from you Shiraz and I've been pleased with the quality. I'm even more pleased with the upfront communication of a really tough business decision forced by an outside party - the US government.

[Edwin Santos]

Wonder what this does to the used market.

I'd say it makes the used market look pretty attractive for the buyer, and maybe a bit better for the seller too.

[Phillip Gregory]

Shiraz, any thoughts about moving production of the machines out of mainland China to other countries unaffected by the tariffs, such as Taiwan?

[Dave Zellers]

Shiraz, any thoughts about moving production of the machines out of mainland China to other countries unaffected by the tariffs, such as Taiwan?

I don't know, but I don't think he owns the companies that manufactures the machines that he sells. They are likely a subcontractor that make similar machines for other companies as well.

But I don't see why Taiwan manufacturers wouldn't seriously think about ramping up production lines to take advantage of this situation.

[glenn bradley]

Moving that sort of operation is not as incidental as the stroke of a pen that could bring the new location under the same situation. If there were guarantees of some of these things in business, the business owners would sleep better at night ;-)

[Simon MacGowen]

Very troubling for business and eventually consumers over an issue about IP protection that is going to be settled by the WTO anyway.

WTO?

Does WTO still matter when national security can be used as the legitimate reason to impose tariffs indiscriminately?

Good luck with that!

Simon

[Richard T Weil]

I ordered a Grizzly jointer in November 2017. I have been kicked down the road by Grizzly CSR FIVE times, and the latest kick says that I should not expect to receive a shipment before December 2018. I have been very patient with Grizzly, but these delays are incredible - and being told I will have to pay an additional 25% for the jointer after waiting over a year for Grizzly to get its act together just doesn't sit very well with me. Is there anything you can do to fix this?

[David Kumm]

There is no standard non custom woodworking machine on the planet worth waiting a year for. Why do that? Buy a different machine, a different brand, a used machine, etc. Lots of better choices than waiting. Dave

[Andrew Hughes]

The answer is a Lie Neilson foreplane. There’s plenty to go around

[Simon MacGowen]

I ordered a Grizzly jointer in November 2017. I have been kicked down the road by Grizzly CSR FIVE times, and the latest kick says that I should not expect to receive a shipment before December 2018. I have been very patient with Grizzly, but these delays are incredible - and being told I will have to pay an additional 25% for the jointer after waiting over a year for Grizzly to get its act together just doesn't sit very well with me. Is there anything you can do to fix this?
You sure you still need one...if you could afford not having it for so long?

Five times? You have been unbelievably patient as a woodworker or as a customer!

Simon

[Richard T Weil]

But I haven't been waiting a year. I've been waiting 4 months, then 1 month, then another 1 month, then 2 months, and now another 5 months. Shiraz now says that there are twenty containers due in, but Grizzly CSR says that they don't have any and aren't expecting any until December. Clearly someone is misinformed. And, yes, David, I should just spit the hook out and swim away, but the bait tastes so good... In any case, it's always good to know that others on the Internet think I'm being foolish. Really.

[David Kumm]

I understand the carrot on a string thing and meant no offense. Dave

[Richard T Weil]

I do enjoy using a well-tuned hand plane, and have lots of them. I also enjoy using a power planer. I don't see why I shouldn't have both.

[Richard T Weil]

Cute, but I haven't been sitting around muttering "wish I had a planer" into my beard for 12 months. I built a second workshop, did a lot of bowl turning, developed and delivered a few woodturning courses, learned to weld and work with metal, and did some laser engraving. I also took 6 weeks off to ski. I do have access to one at a local makerspace where I teach - it's a little inconvenient to haul wood back and forth but it's ok. But in general I do agree with you, I have been way too patient. That's part of the reason why the makerspace just bought a nice Nova Galaxi lathe - I thought about Grizzly but decided I couldn't depend upon them to deliver the goods and recommended the Nova.

[Richard T Weil]

None taken. I am in reactive mode today after Grizzly told me its going to be another 5 months and 25% more cost. Your advise was sound if not in fact what I wanted to hear at this moment. I have access to a complete wood and metal shop now - didn't when I placed the order - so if the beatings from Grizzly continue I will probably cancel my order.

[Simon MacGowen]

B but the bait tastes so good... In any case, it's always good to know that others on the Internet think I'm being foolish. Really.

"Fool me once..." is my motto of dealing with vendors. When a very good friend of mine told me that he had been fooled by the same person (his ex-wife) on some financial dealings -- SIX times, I did not get mad at her, but at HIM. I refused to listen to any more stories between him and her, and have always changed the subject when he tries....

Simon

[Van Huskey]

"Fool me once..." is my motto of dealing with vendors. When a very good friend of mine told me that he had been fooled by the same person (his ex-wife) on some financial dealings -- SIX times, I did not get mad at her, but at HIM. I refused to listen to any more stories between him and her, and have always changed the subject when he tries....

Simon

In general people aren't really "fooled" as much as continually making a cost/benefit analysis. It is well documented that over the last year or so Grizzly has had significant supply chain problems with their high demand "mid-level" machines. Most people that spend any time on forums knew the wait was there and possibly would be extended more than once BUT the price was a high enough benefit to cause them to endure the uncertain wait. Where the consternation really comes into play is I expect most people "thought" their price was locked in. I admit to never having read the fine print on a backorder but I have also never seen the price go up, I viewed them as a "rain-check" and it always worked that way. I doubt, however, any item I have backordered has been impacted by a subsequent tariff, at least of the magnitude.

Just because you or I (or even 99.9% of people) wouldn't wait doesn't mean it isn't the prudent choice for someone else. That said to use the previous analogy there is a point that the great taste of bait has to be seen for what it is, bait. It is still, however, a personal choice for each to decide how close they want to get to a gaff and tail rope before they want to spit out the ballyhoo and pursue another meal.

[Simon MacGowen]

In general people aren't really "fooled" as much as continually making a cost/benefit analysis. It is still, however, a personal choice for each to decide how close they want to get to a gaff and tail rope before they want to spit out the ballyhoo and pursue another meal.

Your analysis is valid, so is the notion that when one makes a choice to be "fooled" (like my friend), one should not complain about being the victim. If waiting is a price to be paid for some bargain deal to be had, the waiting is not an issue, as long as the willingness to wait is there.

However, I do think back orders should be treated like rain-checks and the agreed prices should stay. Of course, "should" is one thing, and the fine print will dictate if prices are free to go up during the waiting period (whether due to tariffs or annual price changes).

Simon

[Van Huskey]

Your analysis is valid, so is the notion that when one makes a choice to be "fooled" (like my friend), one should not complain about being the victim. If waiting is a price to be paid for some bargain deal to be had, the waiting is not an issue, as long as the willingness to wait is there.

However, I do think back orders should be treated like rain-checks and the agreed prices should stay. Of course, "should" is one thing, and the fine print will dictate if prices are free to go up during the waiting period (whether due to tariffs or annual price changes).


Simon

I agree on both counts. You are a victim when someone takes the first bite of your apple, a willing participant when they take the second, excluding force/blackmail or the like. The backorder situation is just my feeling, likely trumped by the "contractual agreement" here. I see Grizzly's POV in that they agree to hold the place in line (not the price) but the buyer is not held to buying nor paying money upfront. I think most of us are used to the common practice of paying the price set when a backorder is placed but when the wholesale price of the good jumps 25% plus an increase in raw materials price it is hard to expect the price to be held (unless contractually obligated and even then there are situations it could be broken). However, I understand if a consumer blacklists a vendor for this, I know I have for less substantive reasons. The good news is that those that are in a backorder situation may have to wait long enough that the tariffs no longer in place...

[julian abram]

Weird. I was setting here reading this thread and noticed an email popped up from Grizzly that my G0490X jointer has shipped. Order date was 12/27/2017. I guess with the tariff deal enough of you fellows cancelled out that I made top of the list. I've certainly thought about cancelling dozens of times but even with the tariff it's still the least expensive 8" spiral parallelogram jointer I can find.

[Van Huskey]

I've certainly thought about cancelling dozens of times but even with the tariff it's still the least expensive 8" spiral parallelogram jointer I can find.

You are correct, even with the tariff the closest pricewise 8" parallelogram jointer with a spiral head is a good bit more more.

[Shiraz Balolia]

Update - we were able to clear about 11 containers of mostly backordered items like planers and jointers just a few hours before the tariffs went into effect last Friday.

Even though some of those containers have still not reached our facility (train, truck from port and so on) we will be charging the customers that are in line the old prices. Some of these products have shipped and others are shipping as we speak, and some will ship next week, all at the old prices. Those customers will not be called unless there is an issue with their payment method (like cards expiring etc.)

More tariffs have been announced on products from China and those are supposed to go into effect in September. No-one knows if the tariffs are here to stay or not, but we have also been receiving price increases from "big name" vendors whose products come from China.

[julian abram]

Shiraz, thank you for the explanation on the tariff & shipments. After receiving the shipping notice last night I was pleasantly surprised to see the invoice amount was still the Dec. order price with no tariff charge. Glad I hadn't told the wife about the tariff.:D

[Martin Wasner]

I'm glad I buy mostly used equipment

[Charles Mathews]

Update - we were able to clear about 11 containers of mostly backordered items like planers and jointers just a few hours before the tariffs went into effect last Friday.

Even though some of those containers have still not reached our facility (train, truck from port and so on) we will be charging the customers that are in line the old prices. Some of these products have shipped and others are shipping as we speak, and some will ship next week, all at the old prices. Those customers will not be called unless there is an issue with their payment method (like cards expiring etc.)

More tariffs have been announced on products from China and those are supposed to go into effect in September. No-one knows if the tariffs are here to stay or not, but we have also been receiving price increases from "big name" vendors whose products come from China.

I can understand tariffs and stuff but was in the Bellingham store 2 weeks ago purchasing your 21" bandsaw and shipping it back to Texas and decided to get a PTG 280 AI finish reamer while there. When the guy behind the counter told me the price I almost fainted. It came up $50 more than advertised in the 2018 catalog. I had to decline purchasing it. Did steel go up that much, really a 1/3 of the total price?

[Richard T Weil]

Julian, good for you. I'm happy that you got what you ordered, and at the agreed-upon price. I have my fingers crossed that my jointer was in the same shipment as yours. I'm not optimistic that I will be as lucky, given that I placed my order in November 2017 (before you placed your order) and have yet to be notified. But I'm not ready to spit out the bait yet.

[Richard T Weil]

Shiraz, I placed my order for an 8" parallelogram spiral-head jointer on Dec 1, 2017. Someone who placed their order for exactly the same jointer on Dec 28, 2017, was just notified that their order has shipped. That doesn't sound like first-in first-out to me. I'm going to call CSR to see if they can shed some light on my order, but its hard to be optimistic.

I just got off the phone with Andrea at CSR. She told me that an error occurred and that someone who was in line behind me received their jointer before me, and that it was the last one in stock. She said that there is no one available today to look into this, and that she will create an action to have someone investigate. If she is correct, its not likely I will see product before December, and that I will probably be charged more for the privilege. This is beyond disappointing. Assuming that I am willing to wait, will Grizzly hold to its commitment on the original price?

[Shiraz Balolia]

Shiraz, I placed my order for an 8" parallelogram spiral-head jointer on Dec 1, 2017. Someone who placed their order for exactly the same jointer on Dec 28, 2017, was just notified that their order has shipped. That doesn't sound like first-in first-out to me. I'm going to call CSR to see if they can shed some light on my order, but its hard to be optimistic.

I just got off the phone with Andrea at CSR. She told me that an error occurred and that someone who was in line behind me received their jointer before me, and that it was the last one in stock. She said that there is no one available today to look into this, and that she will create an action to have someone investigate. If she is correct, its not likely I will see product before December, and that I will probably be charged more for the privilege. This is beyond disappointing. Assuming that I am willing to wait, will Grizzly hold to its commitment on the original price?

This will be handled by CSR.

[Shiraz Balolia]

PTG raised their prices to us and there was nothing we can do. The chambering reamers are a specialty tool and we cannot just find an alternate supplier for it.

[Steven Powell]

My G0453Z 15-inch planer shipped on 12 July after being on backorder since June. I'm not complaining. Some people have been waiting a lot longer than that for backorders to be filled.

[Shiraz Balolia]

Shiraz, I placed my order for an 8" parallelogram spiral-head jointer on Dec 1, 2017. Someone who placed their order for exactly the same jointer on Dec 28, 2017, was just notified that their order has shipped. That doesn't sound like first-in first-out to me. I'm going to call CSR to see if they can shed some light on my order, but its hard to be optimistic.

I just got off the phone with Andrea at CSR. She told me that an error occurred and that someone who was in line behind me received their jointer before me, and that it was the last one in stock. She said that there is no one available today to look into this, and that she will create an action to have someone investigate. If she is correct, its not likely I will see product before December, and that I will probably be charged more for the privilege. This is beyond disappointing. Assuming that I am willing to wait, will Grizzly hold to its commitment on the original price?

Richard - All is well. The manager informed me this morning that order notes indicated something about not shipping before July 14. One has been committed to you and will be shipping soon. They should be making contact with you this morning. We apologize for the miscommunication.

[Richard T Weil]

Thank you Shiraz! I really appreciate your assistance in clearing this up. I saw that my AMEX account was charged this morning for the original price quoted, so things are moving in the right direction.