Heartland Pellet Website?

[Kansasairbuspilot]

Hi everyone, I am entering into my second year of owning my Harmon Accentra Insert Fireplace.

Last year I burned a mixture of cruddy ace hardware pellets, and "calientitos" from Nm, at the end of the year I picked up a ton of Heartland pellets that I absolutely loved.

The problem is that my local shop is charging outrageous prices in my opinion (375.00 plus tax) and I wanted to know if there are any dealers within a reasonable distance that I can get them cheaper from.

Does anyone know of a dealer list, or their website that can lead me in the right direction?

Thanks for your help!

Mike

 

[GVA]

How about giving us your location...

This is a link to prices posted by hearth members in their locale..
https://www.hearth.com/econtent/index.php/fuels
welcome

 

[Kansasairbuspilot]

How about giving us your location...

This is a link to prices posted by hearth members in their locale..
https://www.hearth.com/econtent/index.php/fuels
welcome

My appology, My handle says it all, but I should have mentioned in the post :-&

I am in Wichita KS

Thanks!

 

[GVA]

A couple of links from the WIKI for manufactures.
https://www.hearth.com/econtent/index.php/wiki/File:pellet_info.jpg/
http://www.thelograck.com/pellet_manufacturers.html

$375 a ton is highway robbery.......

 

[Kansasairbuspilot]

Yeah, I thought so too...

They are selling the Heartlands for that price, but even with the higher BTU, its not worth it. THey are nice people, but man, that is steep!

I think I might be renting a trailer in the near future, and going to a distributor

THanks again....

 

[stoveguy2esw]

I'd say to PM zeta and find out how to get hold of the outfit she gets her fuel from , 375 at ton is outright robbery gotta be a better way to heat with pellets

 

[begreen]

Also check your local farm supply stores and Tractor Supply.

Some local pellet dealers:

Hearthland • 615 Maple • Wichita, KS 67213 • 316.262.7349

Home Safe Hearth & Chimney, Inc. - 504 South St. Francis - Wichita, KS 67202 - Ph: 316.265.9828

Warming Trends - 3101 N Rock Rd Ste 130 - Wichita KS 67226 - 800-246-9677

Kansas Hearth Products - 802 W 2nd St N - Wichita KS 67203-6005 - 316-264-3343

 

[Xena]

I'd say to PM zeta and find out how
to get hold of the outfit she gets her fuel from , 375 at ton is outright robbery
gotta be a better way to heat with pellets

(broken link removed) is where I order from but
unfortunately they don't do Kansas.

Copied from their web site:

"We are currently serving the East Coast from Baltimore to Maine
and select areas of the West Coast, although we are expanding our network rapidly".

 

[Shane]

Try Sutherlands lumber. It might be difficult to find a "distributor" as they all come factory direct. I called last year to check into selling pellet fuel and pretty well got laughed at. They told me they might call me in a couple years. Still good pellets though, the only ones that I burn.

 

[seaken]

I know you guys are just being dramatic with the "robbery" crack. Having a little fun. Forgive me for butting in.

I'm just curious, how much are you willing to pay to allow the pellet industry to make a fair profit? How about the dealers? Should they be able to make a profit? Or is it only the oil companies who are allowed to profit?

I submit that you will see the prices of all solid fuels rising as the solid fuel industry struggles to find profitability in the face of fierce and heavy-handed competition from the oil industry and other established cartels. Chance are, in the future, you will be buying your solid fuels, and other alternative energy commodities, from the oil companies after they have finished remodeling their cartel to control the changing markets.

If one of the goals of burning pellets is to help protect the environment why can't we manage to invest at least as much as we would have in buying oil in buying pellets instead? If the goal is only to save money and lower the monthly heating bill, why not invest in better use of the energy value available and learn how to use the energy more efficiently? Wasting pellet fuel energy is just as irresponsible as wasting oil energy. Maybe just improving our habits is enough? Or maybe we really are saving money AND helping the environment when we burn efficient localized space heaters even if we have to pay a little more for good stoves and good fuel.

Personally, we cannot justify servicing our local market with pellets because there is no way to make a profit. We are one of the most knowledgeable shops in the marketplace about the benefits of pellets and pellet stoves. We are trained technicians and are honest with our client base. I consider us "pellet stove experts". Yet, we can not manage to be profitable selling pellets and barely manage to keep a good lineup of pellet burning appliances available to our marketplace. Why?

I think it's because the majority of people who want to buy pellets and pellet stoves need to save money NOW! They cannot afford to invest in the future. If they could, they would see the need to pay more for the fuel and invest in better equipment and delivery systems. I believe this market is coming. But it is not here yet. We'll be lucky to stay alive with pellets until the market changes more toward affordable alternative fuels. In the meantime, I look for outlets like Home Depot or Wal-Mart to increase the availability of affordable pellet fuel. Eventually, it will become a utility like LP gas and be controlled by the big guys in the energy business. You'll get your cheap pellets. But the cost will be higher than you think.

Sean

 

[begreen]

Good point Sean. When they start delivering pellets in bulk like they do in Europe, prices may stabilize. Right now there are too many steps between production and consumption and too much wasted virgin vinyl packaging.

 

[GVA]

Well Sean the only problem I have with the $375 a ton in this case would be another dealer probably has them for $275 a ton...
As most dealers have said here before there really isn't much profit in pellets...
I would suspect $50 a ton would be a somewhat reasonable profit.
So here would be what I would think is a reasonable cost range........

say a pellet manufacturer is in Boston. and they sell pellets at $150 a ton per truckload at again a reasonable profit within 100 miles of said plant. Then for every 50 miles thereafter the cost goes up $10 a ton (due to shipping costs)...
Next the shop tacks on $50 a ton for them.
Seems to me that If you drop a protractor on a map and draw a circle (let's just throw out this #) on a 70 mile radius from the plant. It is from my experience that you find a drastic cost discrepency......Even in the same town there can be $20 per ton difference... Why???? I have seen $75 a ton difference for the same pellets, within 10 miles of each other....This is where the robbery is.

Not many people are gonna pull into the Mobil station selling gas for $2.75 a gallon when the Shell station is selling it for $2.73 a gallon right next door...

Just an opinion here and calling it as I see it locally......

 

[seaken]

Again, I understand that "robbery" is being used to emphasize the point. But sometimes I wonder what people really think when they see my prices. I know they think my prices are too high. But it's not robbery. It business. And that's not to say it's okay to rip people off as long as we call it "business". We are honest business people but we are also smart business people. And we learned the hard way. We learned that we cannot serve everyone. We simply cannot serve the pellet stove customer who does not understand the cost of doing business. If all they see is the price they are not going to be our customer. We do not purposely set out to exclude anyone. But we also cannot sell product at a loss. We live on our profit. All businesses do the same.

This is why I think the pellet supply business will have to done by the big boys. Operations like Home Depot operate on a much smaller margin. They have systems in place that allow the type of margin you have laid out. And there will be similar margins within these similar business models. But a small shop will never be able to match these types of business on price. If they try they will go broke. Many small shops try because they really care about their customers. They know their customers would rather buy from them than a huge corporate entity. But they don't understand how this business works. It is not possible to give the level of customer service we are known for AND sell our products at the margins used by the big guys.

Here's the truth of it. A shop like ours must sell at LEAST at a 40% margin. A 50% margin is going to allow for growth and continued customer service. The big boys can operate at a 20% margin. And every small shop has a different business model within your community. Some are lean and mean (literally) and some are friendly and comfortable. The closer to mean and lean, the closer they can get to the 20% margin. But as the margin erodes, the customer service erodes and the future of the business is in jeopardy. The smart small shops figure this out, usually after trial and error. Then they have to decide what kind of shop they want. If they want more of a friendly and comfortable shop with lots of high level service they must raise prices and hold a margin closer to 50%. The overhead alone is over 30%. Most small shops cannot buy at more than 40%, usually 35% or lower. That means 65% cost of goods plus 30% overhead is equal to 5% net. How much does an owner have to move through this operation to make 50,000 per year? (Is 50K a reasonable profit? Most business people would laugh).

There is no room for charity in this type of small business. If I could buy pellets at $160/ton (including freight as you propose) I will be pricing them at $320/ton. Home Depot, 20 minutes from me can get a cost well below my $160, probably closer to $100/ton. Let's say they spend as much as $130/ton. They will price them lower than me even if they use a 50% margin. They have the room to go as low as $175/ton. I end up looking like a crook because the average customer does not understand my business. They like how friendly we are and how we place nice young people in their house but they won't pay double the price for pellets. No way!

We understand. We don't like paying more for fuel than we have to, either. We are sympathetic to the consumer. Yet, we end up crooks and robbers? But that's the way it works. So, we don't sell pellets anymore. And we sell very few pellet stoves compared to other shops. Not many folks want to spend $3000 for a pellet stove when the shop down the street is less than $2000 for a stove and they are in the pellet supply business. We're no dummies. We like pellets stoves but we have to run a good business. Can't put ourselves out of business - who will take care of our wood stove customers? Or, that nasty fossil-fuel we call gas?

Sean

 

[seaken]

You guys would be aghast to find that I sell my pellets by the bag only and the price is well over $400/ton. But you guys are not who I am selling pellets to. I keep some pellets around only for emergency supply to some of my good customers. They buy their main supply elsewhere. But sometimes they need a few bags to tide them over. I keep the price as low as I can but we sell at the right margin. It's the margin that allows us to be available as an emergency source. Our good customers understand that. The rest walk out thinking we're robbers. Oh, well.

Sean

 

[seaken]

I would suspect $50 a ton would be a somewhat reasonable profit.

With all due respect, this is precisely the problem. There is no way you can know what is a reasonable profit. The business will determine what is a reasonable profit. You will then decide if you want to be one of their customers or not.

No robbery involved. Simple math. Good businesses get it. Most consumers do not. No offense. I am just telling you what I see in real life in my business every day. It's not personal.

Sean

 

[Gibbonboy]

It's just really sad, and it happens in most types of businesses. My parents both ran their own business, my dad had a new car dealership for 40 years, but couldn't compete against the "big lot" dealers who move hundreds of vehicles per month. My father knew all his customers, and provided the best service he could. But the manufacturer decided that small dealers weren't worth the effort, and started cutting the margins to exclude them. My mom owned a clothing store, but now no one will go to local stores that only sell a couple types of products, because they can't compete with the margins that the mega-retailers operate with.

Is it wrong for a customer to want the lowest price? How much is a promise of future good service worth on the initial purchase? I say it's a trend in business to operate on the mega-scale, and sell the cheapest crap you can find for the highest price the market will tolerate, all with zero service or even courtesy to customers. It's frustrating, wrong, and will ultimately hurt the consumer, but everyone is being squeezed at this point. I would have loved to have bought my new furnace from the local Harman dealer, but just couldn't afford it, and I needed heat for my house, so waiting and saving was out of the question. I'm not entirely thrilled with the furnace I got, but it's functional and it's in the basement anyway.

I know that most customers want everything, for free, yesterday. But as sad as it is to see local businesses go down because they can't compete, that's the way the market is being pushed by the same customers. I won't shop in a local store where the prices are 30% higher, just to give out some form of local "business welfare". I don't like it, but that's the way it goes.

 

[BrotherBart]

Sean, why stock and sell pellets at all? Do you stock or sell cord wood for wood stoves? Propane for propane stoves? Natural gas for gas stoves? Kero for kerosene stoves (well you probably do have those $14 a gallon jugs of K1 in the store)?

Why mess with stocking pellets and piss/scare off the people that ask you how much you want for them when they are stove shopping. Do what ya do best. Sell and install stoves and use the availability of cheap pellets at the big box down the street as a selling point for customers to buy your stoves. All keeping those $400 a ton pellets around is doing is running off potential pellet stove buyers when they ask how much they will cost them.

The overhead savings in Rolaids alone will be worth it.

 

[seaken]

BrotherBart, we do just as you suggest. We tell our stove buyers we do not supply pellets. The reserve we have in the back is really a secret stash only for our best customers. They have to get past our filter before they can take advantage of it. And we don't guarantee anything. Sometimes we have a stash, sometimes we don't.

 

[GVA]

I would suspect $50 a ton would be a somewhat reasonable profit.

With all due respect, this is precisely the problem. There is no way you can know what is a reasonable profit. The business will determine what is a reasonable profit. You will then decide if you want to be one of their customers or not.

No robbery involved. Simple math. Good businesses get it. Most consumers do not. No offense. I am just telling you what I see in real life in my business every day. It's not personal.

Sean

Sean, No offense taken....
I understand your margins, but why would the pellets require 50%? Roughly 31% would be the 50 Bucks I eluded to...
Unless you don't have an area to store them they are pretty much set em and forget em.... No special training, or expertise involved......
Parts... 50% to 100% mark-up.... yeah I see that everyday.... It seems to be the norm IN ALL BUSINESSES....
No I don't know what you or anyone else considers a reasonable profit. I just go for the best value.
So with the $160 base yes I would buy pellets from the Stove Shop at $210 a ton as opposed to the Stove Shop for $240 a ton.
That's business too. (selling them for $320 a ton is 100% markup by the way)
Home crapo pellets Suck I would never buy them again even if I could... (they seem to only ship 10 to to each store )
I only buy my pellets from Stove shops now, but some here in yuppieville seem to charge alot more than ones just outside it.

In the business I'm in right now there is always another guy willing to sell you the same product for a little bit less but not to much less as they want to keep the profits high. it's all based on volume and the company as a whole package...
Again It's your right to do what you want at whatever cost you wish it's not affecting me directly so I don't really care....
Again no offense taken here.

 

[seaken]

The answer lies in the cost of doing business. Payroll, rent, storage, utilities, etc. In our business the COST is over 30% of revenue. The more handling, the higher the contribution to cost. If I set my selling price at a 31% margin I would go broke. As long as my customers want me to stay in business I must be careful what I sell. One bad move and it could mean our demise. In the case of pellets, we do not have the warehouse space on our own property and the property we do own is not at our store location. Providing pellets requires rental space and more transfer and transportation costs. That's why the margin has to be 50%. It does not make sense to sell a product for no profit. If the market will not bear the price we need to charge we drop the product. At least until we can figure out a way to lower our cost.

It's possible for a parts house to operate with a 50% markup. But they would have to be warehouse type of operation with little interaction with the general public. The more retail oriented and public the closer to the 100% markup. The difference will be in what type of service the clients for the parts needs. In any case, is the parts supplier does not pay attention to the costs they will not make it. Lowering prices without lowering costs is a recipe for disaster.

Yes, the cost of $160/ton and selling at $320/ton is a 100% markup. But I prefer to use the margin numbers since they relate directly to the financial ratios in my business. Expressing everything as a percentage of sales is more meaningful to me for making good buying and selling decisions. A 100% markup is a 50% margin. A 50% markup is a 33% margin. Many consumers speak in terms of markup but do not understand how that relates to the cost of doing business. A 100% markup, or multiplying cost times two, seems excessive to many consumers. But that's because they don't know the costs associated with providing the customer the products and service they want. If I buy products for re-sale at 60% of retail my margin is 40% if I sell at the suggested retail. If my overhead cost is 30% my net profit margin is 10%. If my cost of overhead is 35% my net goes down to 5%. If I am a small store with say only $1 million in annual sales can you figure the net profit before taxes? Is that going to be more or less the CEO of the big box nets personally? It is clear that the small business is not being unreasonable with a 100% markup. Yet the average consumer thinks buying at the big box corporate conglomerate is better than shopping at the local store who "charges too much". The big box only marks is up 50%, or so they speculate. It must be more honorable to use a lower markup.

I've said it many times before. The only way our small shop can thrive is to cater to the client who can afford the higher prices and then give killer service. It's a shame that the local working family cannot afford this high level of service. I can't afford to price my products and services in their price range. So, we part ways. Most of the folks who post here would not be my customers because they will refuse to pay my prices. The bulk of my customers are those who make significantly more annual income than I do. Most with a six-figure income will not question my markup as long as I fulfill my promises and provide killer customer service.

Sean

 

[Kansasairbuspilot]

Sean, I am sorry, but I have to reply, since I started the thread.

Sean, what you are talking about is greed, not "overhead" or "margin"......

Plain and simple.

If you cannot make the scale of economics work in your business, then you are not meant for the business world.

Please do us all a favor and do not request pity and understanding when you charge 400 dollars per tonne of pellets. That is like asking for pity for Shell Gasoline right now..... Ain't gonna happen.

If your business model is such that your solvency will not be maintained unless you charge 200+ percent on pellets, then I would have to say you need to rethink your qualifications as a business man. Most people would examine their strategic position, and realize their need to diversify....

Your prices are ROBBERY....

 

[Kansasairbuspilot]

PS, The gentleman (or woman) further up on this thread is right..... You do the Entire alternative fuel industry a DISSERVICE when you take advantage of the public in such a fashion!

 

[seaken]

Sean, I am sorry, but I have to reply, since I started the thread.

Sean, what you are talking about is greed, not "overhead" or "margin"......

Plain and simple.

If you cannot make the scale of economics work in your business, then you are not meant for the business world.

Please do us all a favor and do not request pity and understanding when you charge 400 dollars per tonne of pellets. That is like asking for pity for Shell Gasoline right now..... Ain't gonna happen.

If your business model is such that your solvency will not be maintained unless you charge 200+ percent on pellets, then I would have to say you need to rethink your qualifications as a business man. Most people would examine their strategic position, and realize their need to diversify....

Your prices are ROBBERY....

That was hilarious!

Not asking for pity. Not asking for anything. Just wondering what you guys are willing to pay for alternatives to gas and oil.

It's obvious that you don't understand how a business like ours works. I'm sure the other specialty retailers also had a chuckle.

Bottom line - you can't have cheap products AND personalized service. Choose one or the other and stop calling the service providers robbers.

Sean

 

[seaken]

PS, The gentleman (or woman) further up on this thread is right..... You do the Entire alternative fuel industry a DISSERVICE when you take advantage of the public in such a fashion!

Who's taking advantage of whom? We all make choices. Some choose not to pay for service. Some chose to remain ignorant of what true service costs and assume higher prices means greed. Some refuse to notice that the low-price leaders in corporate America, the likes of Wal-mart, etc. are killing the small local businesses and preying on the ignorance of those who choose to think the good guys are always the lowest price.

We'll be alright. We understand how this works. But I do feel sorry for all the small local shops who can't put up with consumers who think they are crooks. They're not. They just can't operate their business in the same fashion they once did. Most will go out of business rather than adapt. Some because they aren't good at business, some because their former customers won't buy from them anymore. But it's almost never due to greed. You're confused. But take heart, you're not alone. Most consumers don't get.

Sean

 

[Kansasairbuspilot]

PS, The gentleman (or woman) further up on this thread is right..... You do the Entire alternative fuel industry a DISSERVICE when you take advantage of the public in such a fashion!

Who's taking advantage of whom? We all make choices. Some choose not to pay for service. Some chose to remain ignorant of what true service costs and assume higher prices means greed. Some refuse to notice that the low-price leaders in corporate America, the likes of Wal-mart, etc. are killing the small local businesses and preying on the ignorance of those who choose to think the good guys are always the lowest price.

We'll be alright. We understand how this works. But I do feel sorry for all the small local shops who can't put up with consumers who think they are crooks. They're not. They just can't operate their business in the same fashion they once did. Most will go out of business rather than adapt. Some because they aren't good at business, some because their former customers won't buy from them anymore. But it's almost never due to greed. You're confused. But take heart, you're not alone. Most consumers don't get.

Sean

AAhhhhh Yes, the old "if you dont agree with me, you must not be smart" reply....... and chuckles?

I am glad you are chuckling....I just bought 4 tonne of pellets for $175.00 per tonne!!........

maybe I should go tell the retailer that he doesn't know anything about business and that I now have to pay him more than double! HAHAHAHAHA

I bet the conversation would be like this "TAKE MY MONEY MR KANSAS PELLET RETAILER! PLEASE! SEAN FROM NEW YORK SAYS IF YOU DONT, THAT YOU JUST DONT KNOW HOW A BUSINESS WORKS!!" ......

THen I woke up.....

And saved a lot of money.....