Posted by:
Rtdunham
at Mon Oct 10 21:15:15 2005 [ Email Message ] [ Show All Posts by Rtdunham ]
This is a sort of addendum to my take (at link below) on the recent fire sale on snow hondos...
I noticed some people saying they lost money on some snake investments. I know this happens sometimes but i'd like to put it in perspective. Certainly it can happen if an animal dies (that's why i always get a backup male for my projects) but more typically people say they lose money because prices have dropped. I always look at these investments compared to the returns we can get on 3% certificates of deposit or the claimed 8 to 9 percent average annual returns on stock market investments. I factor in the fact that a) our labor is usually contributed free but should not be overlooked as a "cost" but b) if you're smart and only work with animals you really, really like, then there's an entertainment value to that work and it's not the same as digging ditches or toiling in a cubicle for the man. 
So...
Say you bought a pair of animals when they were $1,000 each and by the time they're ready to breed the price has dropped to $200 (I don't think they usually drop that quickly but it helps make my point).
You've invested $2,000 in the pair. LEt's be realistic and say you also bought a trio of hets for another $1,000, about what you'd pay for the extra het females and a backup male, which i always recommend.
so your investment is $3,000.
Now, two, or three years later your animals begin to breed. What's a reasonable expectation for production? I use five or six babies per female in projecting production though my hondos often double or triple that. There's always a female that slugs out or has fewer babies than desired. Let's say six babies per female. The original $1,000 female produces 6 of the babies in question (since we're talking about a recessive trait here, in this example that means six homozygous animals, let's say albinos for the sake of this example. The two het females will each produce six babies, equals 12, half which will be homozygous, = six. So 6 6 = 12. And if they're now selling for 200 each, which i think is lower than realistic, that's 12 x 200 = 2400. Say the hets are only 100 each--six hets would be produced, on average, out of the 3 females--so that's another 600. 2400 600 = 3000. In the first year of breeding, the animals have produced their value in babies. In their first year.
You can massage these numbers up or down as you see fit. You can increase the return on investment by factoring in a couple additional het females in the original purchase, and you'll see you do even better. Then reduce the return by subtracting what you've paid for rodents, if you're not raising your own, and any other costs you want to include. Maybe you decide you need two years of breeding to break even. Maybe one. At any rate, once that point is reached, you still own the (now less valuable, but still of value) adults AND all future production is close to profit.
I'm not saying this always works. I'm not saying you should risk the family jewels (yeah, i'm trying to lighten things up) on this. But if you like a kind of snake and enjoy working with animals instead of some other second job, or for added income, it's not a bad scenario. And my example postulates two homozygous animals, which increases the production of more homoZ, albinos in this case. Since overproduction of a single type is an issue with the snow pricing this year, maybe that would produce more than you would feel comfortable finding buyers for, so you'd be better off with a homoZ male abnd a pair or trio of het females. But $200 babies are going to be easier to sell than $1,000 babies, too, there's simply a larger pool of prospective buyers as the price goes down.
Whatever, look at the numbers this way and figure out what your animals have really done for you. I know there will be happy and sad stories.
When i bought those first adult albinos from Louis Porras, i bred one male X several relatively cheap anery females, too, and produced double hets for snow, and X several hypos, launching the hybino project and producing double hets for hybino. All those added to sales without creating too many of one kind of animal. Yeah, prices for albino hondos eventually dropped to one tenth of what they sold for briefly, but i still profited from it. And i still am, now what, almost ten years later?--with the hybinos i produced this year (three females!) and the snows and any number of other phenotypes and genotypes tracing back to animals bought with that original investment--holdbacks helped build my collection, too, and were instrumental in trading for other things i wanted.
If you want to analyze your efforts in a business sense:
1. keep careful track of costs--things like gas driving to the pet store for rodents or the airport to ship animals; advertising; etc.
2. keep track of your sales. remember a trade is obtaining you something you otherwise would have had to pay for, so that new snake represents "income" too.
3. don't forget the animals originally purchased still have a value, either financially or as part of your ongoing breeding efforts.
4. and always, ask yourself if what you're doing is enjoyable. if it's not, consider alternatives. if it is, that's a return on your investment that doesn't show up in your pocketbook but has considerable value nontheless.
peace
terry
my take on pricing
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 about losing money... - Rtdunham, Mon Oct 10 21:15:15 2005
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