Independents

stultus77
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Re: Please let me clarify...

Hi Nick,

Thank you for taking the time to explain your points in greater detail.  I will try to be more articulate...

My point was not that factors like demand/market price do not affect the pricing of luxury goods but that for reasons already explained by John and others, when we discuss Roger Smith and Dufour we are talking about manufacturing/pricing/selling models that differ significantly from "traditional" luxury goods (e.g., Louis Vuitton bags) and even other watches (even a small manfacturer like Journe has greater economies of scale, PR department, boutiques, sales staff, outside consultants, etc.).

With a smaller operation run more like a local craftsman's shop (and hence my example of my tailor), it has been my experience from speaking to Roger and other ACHI members that, especially when their business is just getting off the ground, everything from manufacturing, sourcing to the pricing of their watches is very haphazard and "feel-as-you-go".  The process is nothing like a larger, established manufacturer or especially a multi-national corporation with specialized resouces to conduct market research, pricing models, market surveys, etc.   Without over-romanticizing them, guys like Roger and Volker are watch makers first, and they do business the best they can.   They may get better at it (e.g., Franck Muller has shown himself to be a spectacular businessman), but I think the main point is that in our cyncisim with multi-nationals we are probably attributing too much business acumen to them at this point.  In some ways, they sort of look around and try to get a general "feel" for the market, and are not using complex, economic models.  If anything, the market probably has an indirect effect on their pricing because of general price levels in the the market.  What bothered me was that some posts seemed to be implying (intentionally or otherwise) that the price differential was based on some rational, calculated scheme to defray marketing costs, etc. 

I remember speaking to Thomas Prescher at the first TEMPUS.  He had spent many tough years making and developing his multi-axis tourbillon and finally sold them to a collector, and he and his wife were finally able to buy a new car.  He wasn't sure about the demand for his watches and how much he should price them at, but he was happy and pleasantly surprised to see collectors interested in his watches and to be able to sell them.  Not really the way things are done at Louis Vuitton HQ, I'm sure.

In some ways, I am sad that many posts did not seek a horological justification first and foremost for the pricing differentials between the watches in question, especially when the similarities among the watches was no more than superficial.  Guess the watch market in recent years has made cynics of many of us (myself included)...


- Daniel