Advanced Warehousing Plans

Optimizing Your Operations and Your Ledger

As we approach the halfway point of 2021 (yep: July 2nd, for those calendaring on at home), it's never too soon to think about the end of the year.

COVID-19 restrictions are easing in the United Staes. The economy looks to be revving up. The supply-and-demand pendulum has swung back in favor of the demand side, which is causing all sorts of logistical challenges across multiple industries.

(Here's one example: there's a shortage of peach flavoring. To the chagrin of Starbucks peach green-tea lemonade lovers (especially in Georgia, the Peach State.)

Given this past year and a half of unpredictability, we'll be the last ones to predict what the next six months will bring.

Except for this: we know ⏤ and with fairly good certainty ⏤ that the Section 179 tax break remains an excellent way to save money for your company's bottom line.

As Uncle Sam describes it:

“Essentially, Section 179 of the IRS tax code allows businesses to deduct the full purchase price of qualifying equipment and/or software purchased or financed during the tax year. That means that if you buy (or lease) a piece of qualifying equipment, you can deduct the FULL PURCHASE PRICE from your gross income.”

For the year, that means a deduction of up to $1,050,000. That's not peanuts. And we like peanuts.

Among a few other terms, this means putting your equipment into service by December 31, 2021 in order to qualify for the deduction.

And there's the rub. The supply-and-demand imbalance is disrupting the ability to get essential and desired things to the end user in a typical, pre-pandemic manner. That's why we're encouraging you to plan ahead for the rest of your year's needs with some extra buffer room.

We've detailed the steel surcharge that's affecting our customer base. Essentially: our factories are passing through to us a "steel surcharge" on new yard ramps. We, in turn, will pass through this charge to our customers without markup.

The good news is that both Section 179 and ⏤ should you need or want it ⏤ our partners' financing services are agnostic about the total price. Which means that with or without a steel surcharge, you stand to take a full deduction off your purchase price for qualifying equipment.

It's a great deal. In our eyes: totally worth it.

This week, our man McCoy Fields leaves his man cave to explore...other caves.

Click HERE to see if he went all batty.

The Steel Surge

Braced for the Impact of Market Volatility

Steel Prices Go Up...and Down?

Due to recent volatility in the steel industry, our factories are passing through to us a "steel surcharge" on new yard ramps. We, in turn, will pass through this charge to our customers without markup.

The "sudden" rise in steel pricing has happened for a number of reasons, including the ongoing international tariff battles, along with China's 55% of the steel manufacturing market and its post-pandemic decision to reduce exports.

Yes, we're in a supply-and-demand adjustment period.

(And not just steel. Try buying a gaming computer right now.)

As S&P Global reports, "What we are witnessing is the continuation of a demand-driven trend that began exactly a year ago, when China saw a fast rebound in economic activity following its rapid exit from lockdown, which was immediately matched by a sudden spike in steel prices."

As with prior spikes in steel pricing, we think⏤and hope⏤ this is a temporary condition. Economists are predicting steel demand to significantly outpace supply through the end of 2021.

Fortunately for our customers, The Yard Ramp Guy's status as the #1 dealer for each of the three factories we represent means the factor used to calculate our steel surcharge is considerably more favorable than that of our competitors.

We will continue to sell yard ramps at pricing lower than our competitors and lower than our factories will sell directly to end users.

Thank you for your understanding as we all navigate these continued strange times.

This week, our man McCoy Fields jumps into the ocean and discovers a shark feeding frenzy...on fiber optic cables.

Click HERE to see how McCoy survived, and if he needs a bigger boat.

Steel Evolutions

Words Matter

YRG on steel in the future.
Mining for Consensus

The movement to reduce pollution across the globe involves a number of components with many moving parts.

Some of these are tangible things, like the technology used to turn a commodity into a finished product. Some are a matter of employment logistics, like retraining people from one discipline (i.e., oil production) to another (i.e., solar).

And some of these aspects involve the words we use. Words matter. They inform perception, desire, feasibility, acceptance, and utilization. Words serve to influence hearts and minds.

There's a careful balancing act involved. What some call deceptive propaganda, others call a sensible way forward.

Why this emphasis on words for The Yard Ramp Guy, a business that rents, buys, and sells industrial yard ramps? As we spotlighted recently, Green Steel has taken a foothold in our industry.

In 20 years, your new yard ramp may well function the same as your current one does now. That said, the way our manufacturers will produce it and the way our logistics experts will deliver it will likely be entirely new.

If projections are to be believed (yes, that deceptive propaganda vs. sensible information battle), your new ramp's production and delivery will have left a smaller carbon footprint.

ResponsibleSteel, "the steel industry's first global multi-stakeholder standard and certification initiative," in partnership with The Climate Group, campaigns to "maximise steel's contribution to a sustainable society. This can only be achieved through cooperation and mutual commitment by companies at all levels of the steel supply chain, representatives of civil society and other stakeholders."

The group recently discussed the lack of agreement about what the concept of "green steel" refers to:

"Words matter. We think it is critically important that the term “green steel” should not address GHG [greenhouse gas] emissions alone. We cannot be silent on the wide range of social, safety and environmental issues which are important to steel companies’ investors, customers and other stakeholders. Safety comes high on the list of concerns, as does the impact of mining where issues such as tailings dams, relations with Indigenous Peoples and local communities, human rights concerns and impacts on water and Protected Areas also come to mind. We would strongly advocate that any entity offering “green steel” would have to show how it addresses the range of social and environmental concerns and not only GHG emissions."

That's a pretty remarkable, forward-thinking, and holistic approach to all aspects of the production chain that gets steel from the ground to, say, your dock as a yard ramp.

This week, our man McCoy Fields, in his very McCoy way, rides an elevator...to infinity and beyond.

Click HERE to hitch a ride with McCoy.

Green Steel

A Quieter Footprint

Girding for a Change in Process

Our industry is showing some fascinating movement in regards to adapting to change.

Steel is the backbone of our business. While we carry the occasional aluminum yard ramp, the vast majority of our inventory is composed of steel.

Processing raw iron alloy and shaping it into an element for construction comes at a heavy cost. Here we are not talking strictly about money: pollution factors in at an alarmingly high rate. Forged steel creates, among other things, greenhouse gas emissions, emissions to water, and metal dust, all of which negatively impact our environment. Some seven percent of CO2 emissions are from iron and steel production.

We have what seems like competing ideas: growth in our construction demands versus reductions in our carbon footprint. How do we balance the two?

The supply-and-demand dance has long fascinated and vexed economists, Wall Street, and manufacturers. As we've seen recently with the GameStop controversy, sometimes artificial confidence (and its opposite) can have sudden and dramatic effects.

What if, though, the end result of the demand remained the same, and it was the process that changed?

Jesse Klein's recent essay in GreenBiz spotlights a remarkable, budding challenge to major players in the steel industry. She writes:

"A new initiative called SteelZero, created by The Climate Group in partnership with ResponsibleSteel, hope to break the cycle on the demand side. The program brings together the top steel buyers across the globe — including construction companies, real estate groups and property developers — and challenges them to commit to procuring 100 percent net-zero emissions steel by 2050."

As in: picture major participants in the steel industry forging ahead with that demand for clean, 100 percent net-zero steel emissions. The 30-year window allows time for development of the technology, adjustment to reasonable price points, and saturation of the supply chain.

Impossible? A decade ago, the old guard of the fossil fuel industry might well have said (or thought) (or hoped) that hydrogen- and battery-powered vehicles was a pipe dream. Yet, late last month General Motors ⏤ the world's fourth-largest vehicle manufacturer and the largest in the United States ⏤ announced its plan to sell only zero-emission vehicles by 2035.

In that context, zero-emission steel by 2050 is not so much a pipe dream as it is a realistic girder for the industry.

As Jesse Klein quotes Jim Norris, senior project manager for SteelZero: "We’re really wanting to show a commitment directly to steel producers that the buyers are ready. It’s up to steel producers and policymakers to step up to market and really accelerate the decarbonization of steel production."

We'll explore different aspects of cleaner steel throughout the year. In the meantime, steel yourself for such a promising change.

This week, our man McCoy Fields describes an army that serves...a corporation. And it's all mostly good.

Click HERE to read McCoy's rules of engagement.

Material Handling Statistics

On The Confidence Index

The Yard Ramp Guy: Confidence
An Intersection of Confidence and Necessity

Last week, Material Handling Network published an article, calling the Monthly Confidence Index for Equipment Finance Industry Steady in July. Pulling data from the Equipment Leasing & Finance Foundation, it highlighted a number of insights. Among those:

  • Equipment finance is a $900 billion/year sector.
  • Overall confidence in the equipment finance market is steady.
  • 95% of equipment finance companies have offered payment deferrals.
  • A majority of companies (83%) have not furloughed or laid off employees.
  • Half of those surveyed believe business conditions will remain the same over the next four months.
  • 75% of executives expect no change in headcount over the next four months.

Said one executive, "We are starting to see some spending, possibly pent-up demand, with businesses that had put acquisitions on hold at the onset of COVID-19. Stronger borrowers are looking to take advantage of the situation and tuck in, or otherwise acquire weaker competitors."

Two of our colleagues⏤one a current vendor, one a former vendor⏤echoed The Yard Ramp Guy's experience with recent business trends: a strong first quarter, followed by a dive in early April, followed by a strong uptick in business from mid-April through July.

In any given year, there is a curious dance of trending activity. The late-winter/early spring dip. The spikes and plateaus and steady inclines through the end of the year. Those are generalities. Sometimes we see peaks and valleys that make little sense in our material handling industry or in our associate vendor industries (i.e., freight logistics and equipment finance).

Most interesting about the Confidence Index is the relative steadiness and growth across equipment finance⏤and, by association, material handling⏤is that percentage of confidence. It's reflected in the volume of business we're experiencing, here and now in the midst of a pandemic that remains invisible, dangerous, otherwise disruptive, and ever-troubling.

We have seen a growth in sales and rentals of new and used yard ramps to businesses deemed essential services. Numbers don't lie. And while hope is an unquantifiable entity, we suspect (with reasonable doses of both optimism and practicality) that business in our world remains strong⏤in large part because it must.

This week, our man McCoy Fields, goes all Ripley on us and, believe it or not, puts together a list of amazing inventions.

Click HERE to see proof that the ancients were not primitive.