How we are coping as a business during the Covid-19 Pandemic
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I’m not at all surprised to hear that the Iron Heart crew are meeting this challenge with thought and care for everyone involved. Thank you.
I’m very glad to be a part of your customer base/community, and hope we all make it through to the other side.
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We are living in very trying and scary times, I greatly appreciate the business plan that IHUK and IHJP has projected. I also appreciate what the coworkers at IHUK and IHJP are doing to maintain this business, which I feel will succeed in the long run. It's reassuring to hear this. Thank you.
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Shout outs on social media… may or may not help. Always worth punt though...
https://www.instagram.com/p/B-PnGM_jkY1/?igshid=1dixz1jyxzlor
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thank you for sharing G. I can only imagine how difficult this is for everyone involved in the supply chain. I've been thinking of you all a lot recently and am hopeful you can find a way to ride through this safely. It sounds like everything that can be done is being done, fingers crossed!! -
One of the issues we have is that the Japanese side of the business has been shrinking for some time, it has been the international market that has been helping out. The Japanese market will shrink a lot more because of CV-19, we have to hope that the international side of the business can keep it's head above water enough to compensate for the domestic drop in demand. It's going to be tough…...What we look like when we come out the other side depends entirely upon how this thing lasts (obvious point, sorry)....
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Thanks for the explanation. Not a situation to be lightly taken. This has become a global problem. I am hopeful everything will work out for everyone at the end.
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when stringent measures starting taking place, shops began mostly trading online as an alternative. now, i'm slowly starting to see online shops closing. hanon boutique, a store that mostly do sneakers and based in scotland, announced their closure of online shop and warehouse for outgoing shipment a few days ago.
do you think it'll ever come to this situation? is there a way to mitigate it from becoming that way?
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For us to continue with the online store in the short to medium term, it depends on 4 main factors.
- That our staff remain well. One of the reasons we only have only 2 people in the office, is to protect the others. If one of the 2 contract the virus, then they will both have to self isolate, but we can back-fill with other staff.
- UPS still pick up in Japan, still deliver to our office and still deliver to customers
- The Kojima store remains open, Haraki is working on implementing a staffing regime like we are doing in the UK
- The UK government continue to allow our staff to go into work
We are doing everything and will continue to do everything we can to keep the online store open. In all honesty, we need to create as much revenue as we can to survive until the other side.
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We have just had a very useful and uplifting video call with H, Tom and Sarina. We discussed our individual challenges, so we are all aware of what is working and or hurting each party and we discussed what each party could do to make things easier for us as a whole. Haraki is off to visit the factories now, so he can have similar discussions with them. He liked te Zoom meeting so much, that he will probably start doing the same thing with the factories going forward.
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That’s good to hear, Giles.
I clumsily mentioned to the other half at breakfast that I’d like to buy something from you guys to help out. You know, selflessly.
She’s not exactly onboard, but I think I may break her yet. -
I have noticed a number of retailers are having a sale. Would this be a viable fix to smooth out cash flow in the short term? This is far from being a "normal" business cycle, every stage from the supply chain to its end users are influx. I do not own/run a business, so my perspective and knowledge is very limited.
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Personally, for a brand and the brand's whole ecosystem, I think that holding a sale is very bad business. If the reductions are not policed, reductions become a race to zero and everyone loses out. If we did suggest that IHUK and our all of our retailers do reduce product by a set amount, IHUK would be the ultimate winners. We are an online store, that's really all we do, so we are fucking good at it. We have stacks more inventory than any of our retailers and certainly some of our retailers cant even run their online stores at the moment. So basically we would screw our retailers. And say we did hold a sale to shift stuff, we could come out the other side with compromised inventory levels and it would take months to build up stock with money we don't have because the retailers have not had bricks and mortar customers for weeks if not months, so they still need extended credit terms. I have heard of some shops that have already had sales, let's say at 25% off, the sale went amazingly well, but guess what? They now have fuck all product and less money to purchase restocks.
We agreed this morning with Haraki, IHUK will take out loans to protect our business from the impact of retailers slowing down payments and/or possible bad debts if a retailer simply can't pay (we think we have a $20K exposure in this regard already), Haraki will give us plenty of leeway with payment terms to him. Haraki, on the other hand, will take out loans so that we can still place orders on the workshops, we need to protect them so that they stay in business.
Have we got it right? Have no idea, never been here before. Could my position change? Yes, the world changes every day at the moment. Twelve days ago I wrote to Haraki and said, when I met with you 4 days ago and I had said "by the middle of next week the whole of our retailer network will likely be shut", you'd have thought me mad. When I went out for dinner with him 2 and half weeks ago, the biggest problem we discussed was a possible shortage of constructional thread…
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I really enjoyed that response. Because relatively speaking IH is a small operation it made it easy to wrap ones head around the impact of the current situation to businesses.
In the meantime money isn’t going to my barber or bartender so a CPO and a Westpoint are one the way. -
Thanks all for your encouragement and support
As G said we've never expected or encountered anything like this before. One of the questions from the bank about the emergency loan was:
"When the Pandemic is resolved, how long do you believe it will take you to start recovery?"
I found that tricky to answer. I wanted to say "We've no bloody idea when it will be resolved, so I've no bloody idea!"
Instead I wrote "Another difficult question to answer, because none of us knows when the Pandemic will be resolved. If we base this on a period of 4-6 months before the Pandemic is at least considered “under control” then we should be able to start to recover quickly. We expect to keep our staff team intact and motivated, and we are extremely fortunate to have a very large, loyal, international customer base." Which is the truth, and we're very grateful for it.
If they ask any more impossible questions, I might be reaching out to you guys to help with my responses!
