Should livery yards respond to the recession

needadvice

I have been thinking on this subject and everywhere you turn businesses are offereing more for the euro to keep our business. Should livery yards and riding schools be doing the same or can we all be expected to try to keep up the costs that exist. Just a thought as we are all looking for value in every other area at the moment. But hard to say I suppose but prices have hiked in the last 4 years along with the celtic tiger and perhaps its time for a little review.:rolleyes:

togster

I mean it is all about supply and demand. I don't think anyone should have to lower prices. I know if i had a livery yard i would only lower prices if i had to.

needadvice

You are absolutely right in what you say really.

Kamili

I don't think that they will drop their prices.
The VAT rate has just gone up, feed prices are higher because of the bad summers we've had, with vets and farrier bills have gone up too. The cost of hay etc will go up as a result along with the cost of bedding due to this VAT rate. Maybe we should all go to Newry to buy feeds, bedding etc, as the UK vat rate has dropped significantly!!

I know that the yard that I am in has lost a lot of horses due to the pure cost of keeping them in/ near dublin being far to expensive. Yet the yard manager had to put prices up despite this during the summer. She's also had staff leave as she hasn't got enough horses in.


I would love to see livery prices drop and a bit of competition start between yards, and I really hope that despite the recession yards will not cut corners and look after their horses properly. But I suppose if they don't owners will have no qualms in moving their horse to a place that is better value for money. IMHO the recession might be a good thing, it might start a "customer is always right" approach to everything, something I feel is seriously lacking in this country....

needadvice

Well your thoughts do reflect mine and I worked for years in livery and there is space to offer value to customers without cuts. I heard today actually that a yard in Enniskerry has decided to cut and freeze prices as there is strain on horse owners and they promise no change in service standard or facilities. We'll see where it all ends up but the VAT is a huge problem for yards who pay it and truly legally they all should but doubtless some try to escape it. And your absolutely right competition is healthy it improves the clients chance to gain good quality at competitive prices so maybe recession will wake us all up.

needadvice

Actually Kamili unless I'm mistaken the new rate only affects the 21% on products not the 13.5% on services therefore thats a plus for livery yards not a minus if I'm right not my thing really. So not a reason for holding high rates in place.

needadvice

needadvice wrote: »

Actually Kamili unless I'm mistaken the new rate only affects the 21% on products not the 13.5% on services therefore thats a plus for livery yards not a minus if I'm right not my thing really. So not a reason for holding high rates in place.

You know that price is a function of demand right?

If the demand falls, the price will fall. Simple as.

needadvice

You are taking up Togsters point and its accurate but in a climate where financial pressure is huge though some have yet to feel it I would move my horse to equal or better standards at a lower price without hesitating so therefore competition lowers prices too.

Without getting into Econ 101 here,

Yes, price is a function of demand and deman is a function of price. There is an issue of endogenous variables there.

However, if yards find that demand for places is falling, they will lower prices. Some yards will cop on and try to poach customers by lowering prices, this will lead to other yards lowering prices. Simple, standard economics in action.

Kamili

needadvice wrote: »

Actually Kamili unless I'm mistaken the new rate only affects the 21% on products not the 13.5% on services therefore thats a plus for livery yards not a minus if I'm right not my thing really. So not a reason for holding high rates in place.

products like feed, hay, bedding etc.

all yards will be hit by the VAT increase on those will they not?

Socos

Horsel feedstuffs are VAT exempt so increase will not increase their cost.
Shavings coulod inrease slightly. What was costing €10 will now cost €10.04.

needadvice

Ok to get the VAT question straight. And I have this from the horses mouth so as not to print a falsehood...... I asked someone who does this for a living last night.

All yards turning over more than 700 odd a week thats turnover not profit must by law be registered for VAT.

That essentially means and its tough on them that they have to pay the VAT man 13.5% of your bill to him and as said horse feeds aren't VAT added neither are some other related costs. They then can claim VAT back on their costs but thats really very little so VAT is quite an expense but a legal obligation. Also all bills containing VAT must carry a VAT number.

So its the rate of VAT on your bill if your yard is paying it that is hard on them but law is law. Hope that makes sense to you.