Saturday, July 7, 2012
New Shop Review: Will A Canoe Do It For You?
You're going to suffer a bit of sticker shock on the asking price, I'm not going to sugar coat this, it's high. And you should evaluate this investment carefully, because it is not a cut-and-dried decision like the Bistro and Salad shops that were introduced at the same time.
The shop makes all it's inventory from lumber. And it requires a lot of lumber. As Market-Watchers know, Lumber is a volatile commodity whose price has only increased since the beginning of the year. Even at an average lumber price, the Canoe Shop is going to bring you nothing but Red Ink.
Don't check out on me yet, because there's a huge up-side to this Franchise that you may want to carefully consider.
The Canoe shop will bring you stellar performance in the experience department. The level 46 Prehistoric Car Lot (bought with crystals) is the only shop whose experience can out-pace this one.
If you can subsidize the daily losses, which on average, are 23 thousand for paddles and 4,800 for life jackets, from the profits on other shops, it's quite the worker.
Your break-even point is 3,500 to 4,740 (cost per thousand at Market). When the market price exceeds those levels, you are entering Red Ink territory. The market average has been 5,167 so far this year, with more recent prices pushing the average further and further up.
I'm going to buy a few, and make sure I have a Scooter store or two to help subsidize the canoe works. Check out all the nitty-gritty details at the Tiny Village Wiki.
Nanakins' Recommendation: Tread Carefully. This is an expensive store and it will run in Red Ink most of the time. Because it earns such great experience, it is worth consideration. But be careful. You could lose your shirt running this without a careful eye on things.