Play Meter

Issue: 1981 February 15 - Vol 7 Num 3

Pool· tables' 'critical issue'-
the cost and availability of slate
By RAY E. TILLEY
Pool table manufacturers entered
1981 faced with a potential shortage
of slate, a chief ingredient in the
tables. Some table producers in
America had slowed or stopped
production for some periods of the
last few months of 1980. All of those
contacted by PLAY METER said
they foresaw a price rise on the table,
following "substantial" hikes in the
raw material cost.
Depending on the material
supplier, the cost of slate was rising
by 25 to 35 percent, said one
manufacturing official, although
negotiations are periodically made
on price of slate. The problem arose
out of northern Italy, where the main
quarry sources of slate are found .
The problem was compounded by
Italy's steep inflation rate, the
shortage of qualified labor to work in
the quarries, the allegedly limited
natural supply of the raw material
(which has comparatively little
mining activity in the United States),
and recent strikes into "bad veins" of
poor quality slate in Italian quarries,
said various coin-op industry
sources.
Competitive bidding against the
coin-op industry for the table
material, as by department store
marketers of home-use tables, also
apparently contributes to the hiked
price of available slate.
Richard Simon, executive vice
president of U.S. Billiards, compared
this economic situation to the
problem of energy sources. He
termed it a "worldwide bidding war"
for the material which also sees use
in the construction industry for
fireplaces, blackboards, tiles, and so
on.
He added that he was confident of
his own long-term supplier and had
built up sizeable inventories of slate
for the Amityville, New York pool
table manufacturer.
Others of the major table makers
saw no difficulty in their near-future
acquisition of slate-but the price
increase may soar "geometrically
upward" in 1981, as one put it.
Some table manufacturers have had production slowdowns when slate appeared
in short supply
Cartels
Some suggested the problem of
higher prices may be created by a
monopolistic "cartel" of 26
companies running the quarries
south of Genoa, Italy. Allegedly, new
quarries have been opened at San
Remo, where there lies "high-quality
slate for years to come." The
Ligurian slate syndicate ( Consorzio
Ardesiaco Ligure) in that area
reputedly controls 60 percent of the
slate sold-with the supposed aim
being the standardization of quality
of this export.
Once the slate is mined and ready
for sale by the several companies, "it
is phenomenal how close the pricing
is," said one source who wished not
to be identified. He suggested the
asking price for the raw product is
"fixed" in a way that is unlawful in the
U.S. economy.
But any alternative material will be
costly to come by, judged U.S.
Billiards' Simon and other firms'
representatives. And if an alternative
material were developed, Simon
commented, "you have the psycho-
logical factor of telling a guy he's
playing on something other than
slate. He may not do it."
Irving Kaye Co. partner Howard
Kaye said, "There's no way to know
if it's a real shortage or not." But a
shortage to the American manu-
facturers may be felt acutely in the
first quarter of 1981, he indicated. If,
in fact, the available raw material is
running out in Italy, then the price
increase by the supplier may be
"justified," he said.
Quarries in the Fontanabuono
area, a valley flanking the Gulf of
Tigullo, where the slate is mined, are
leased from the Italian government.
It appears the shortage is not with
the fossil material but rather with
labor to harvest the resource. The
Italians' social welfare system
apparently makes it more appealing
to take state-paid sick leaves than to
work the strenuous job of a quarry
worker, said one observer.
While the price rise for other
materials and transportation are
added inflation factors for the pool
table, an independent source
estimated the coming increase from
slate prices alone at $100 for the
operator buyer of a table .
(Manufacturers themselves declined
to estimate the projected table price
increase at year's end.)
Mark Struhs, marketing director
at Dynamo Corp. termed the slate
price rise "incredible ... and projec-
tions indicate there will be a drastic
increase next year." Struhs said he
saw no effect on the demand for
tables, however.
Effects on an operator
While price is "the most critical
issue we face ," said Charles Milhem,
president of The Valley Company,
he analyzed the operator's position
in a time of rising table cost this way:
" From the operator's point of view,
the value of his existing tables will
increase -
re-sale value will
increase- to where there are some
benefits to him."
Over the long term, tables will
retain more "intrinsic value ," in other
words .
The strategy of the table operator
should be to go to 50-cent play at this
point in time when there is cogent
reason to do so, he suggested.
Valley, as other manufacturers are
coming to do, is shipping its tables
set for 50-cent play. The operator will
have to take active steps to change
back to quarter-per-play.
The point was made that slate of
the smaller dimensions is more
readily available, but that the popular
movement in pool tables is to the
larger models, requiring larger
dimensions of slate-therefore the
more costly raw product in their
manufacture.
Milhem suggested the operator
stress the larger table, however ,
because "players want it," and it can
be a better draw for 50-cent play than
the small billiard tables.
Coupled with this, however, must
be the price-conscious fact that
"there has been some disjointment"
in the slate cost at the larger-cut
sizes.
Alan Schafer, vice president for
finance at The Valley Co., said "the
burden" in this pinch is on the
manufacturers. Valley had required
some three weeks' plant shutdown
over a four-month period, he said.
But he foresaw a harder shortfall on
"the smaller manufacturers."
Echoed around the coin-op tables
industry was the complaint that pool
table production has frequently been
"behind" with the material shortage .
For the operator, though, the
tables remain "a super investment,"
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said Simon at U .S . Billiards.
"Pool tables are slow selling,
although their income has increased
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price increase, they're still a super
investment because of their low
service requirements and excellent
income," he continued.
An irony in the picture for
American manufacturers was noted
by Schafer at Valley. One domestic
source of slate, a Pennsylvania
quarry , was closed several years ago
by the U.S. OSHA agency for on-
the-job safety.
In addition to the available foreign
raw material's cost comes the cost of
transportation to U .S . m a nu-
facturing facilities such as Valley's at
Bay City, Michigan; Irving Kaye's a t
Stamford, Connecticut ; and
Dynamo's at Grand Prairie, Te xas .
Alternative natural materials, such
as marble or granite, are judged by
the manufacturers not to have slate's
stability. The other rocks are less
brittle, say the produce rs of pool
tables. But the cost hike in slate has
made manufacturers take anothe r
look at alternatives- which one firm
reports has cost half a million dollars
to research as viable tabl e -top
material, in the past 15 years or so.
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