[Leica] Minor additional woe

Sun Aug 9 01:22:18 PDT 2015

Jayanand,
If they trebled their current prices, we would be in agreement. They are still nowhere near expensive enough to be profitable if you are right about their business plan (which I would wholeheartedly agree looks likely). Despite years of widespread pessimism about Leica’s future the first time I thought the end was nigh was when I heard about investment by venture capitalists. Rapists.
Frank D.

> On 9 Aug, 2015, at 04:32, Jayanand Govindaraj <jayanand at gmail.com> wrote:
> 
> Frank,
> Your expertise is engineering, mine is corporations, including the behavior
> patterns of those with substantial P/E investments. Lets agree to disagree
> on this one.
> Cheers
> Jayanand
> 
> On Sat, Aug 8, 2015 at 11:54 PM, FRANK DERNIE <frank.dernie at btinternet.com>
> wrote:
> 
>> Jayanand,I think the only things they sell in the way you believe are the
>> special editions at £20,000+.
>> Both Canon and Nikon sell their top models at a loss, since the production
>> volume, which is far higher than Leica M, means they can not be sold at a
>> price which covers costs, the manufacturing is amortised over too few
>> units.They can make their profit by selling vast numbers of less expensive
>> cameras. Leica can't.
>> Leica bodies are probably subsidised by the lenses.
>> I believe that the reason the S system was MF was because the pricing is
>> dictated by the volume and they felt, quite rightly I am sure, that an
>> autofocus 24x36 sensor Leica would not sell at S prices. The vast bulk of
>> the cost of something selling in these tiny numbers is R&D and tooling, not
>> the parts.
>> Comparing them with Rolex is inappropriate IMO too. Rolex make thousands
>> of times more watches than Leica make cameras. The movements are mass
>> produced in an already-paid-for production line and haven't needed any R&D
>> for decades, the profit margins on seen-to-be luxury goods like this are
>> vast.
>> Marketing strategies are pretty flexible but the basic inflexibility of
>> R&D, tooling and manufacturing an engineering product are nothing like
>> those of luxury goods.
>> Frank D.
>> 
>> 
>>     On Saturday, 8 August 2015, 14:47, Jayanand Govindaraj <
>> jayanand at gmail.com> wrote:
>> 
>> 
>> 
>> John,
>> That they are, and I don't disagree, but your buying the stuff they make
>> new is just icing on the cake as far as they are concerned. Their primary
>> market and focus lies elsewhere, and, irrespective of what you think,  I do
>> not fault them for that - on the other hand, I admire them as having taken
>> a quite brilliant business decision a decade ago. After all, they have to
>> survive by selling new equipment, not pandering to the wishes and
>> requirements of those fans/users who are unlikely ever to buy Leica stuff
>> new. I am sure that over 95% of the Leica using photographers seldom buy
>> their Leica stuff new, and the production has to be sold, after all, so
>> what choice do they have, but to take advantage of their hard earned
>> goodwill built over decades of excellence, and market their products as
>> bits of jewelry for whatever price the market will bear? Very sensible high
>> margin approach, which has worked very well over the last decade, but now
>> that the luxury market is flattening to reducing, we have to see what
>> future path they take. Let us not forget that they have to run a business,
>> and make money on it. No different in approach from what a Rolex, a
>> Montblanc or even a Mercedes/BMW would do - all of them have a large
>> proportion of their allure tied up in the aspirational desires of humans -
>> but that does not mean they turn out anything but the best they can, at
>> their price point. If you ask me, Leica's weakness in comparison to all
>> their luxury peers is what seems to be relatively weak after sales service
>> - they probably get away with it because a large part of their yearly
>> production is never used!
>> 
>> I personally would also think very seriously of adding to the icing if they
>> come up with a full frame, AF system based on the M series, as has been
>> rumoured, and they set up their dealership here in India by then, so that I
>> have a local outfit to handle problems if they occur.
>> 
>> Cheers
>> Jayanand
>> 
>> On Sat, Aug 8, 2015 at 1:31 PM, John McMaster <john at mcmaster.fr> wrote:
>> 
>>> For a company that is doing all that, they seem to spend a lot of time
>> and
>>> money making some of the best lenses available for any system.......
>>> 
>>> john
>>> 
>>> -----Original Message-----
>>> 
>>> 
>>> Adam,
>>> It has been blindingly obvious for a long time, to anyone who does not
>> have
>>> his eyes wide shut,  that Leica has morphed into a luxury marketing
>> company
>>> (have you ever bothered to notice WHERE they advertise nowadays?)! They
>> are
>>> opening boutiques in India now in partnership with the largest
>>> dealers/purveyors of luxury goods here. However, there is hope for them
>>> though, to change back into a photographic company, now that luxury goods
>>> sales in China have drastically plunged across the board.
>>> Cheers
>>> Jayanand
>>> 
>>> On Fri, Aug 7, 2015 at 10:06 PM, Adam Bridge <abridge at mac.com> wrote:
>>> 
>>>> That’s even worse.
>>>> 
>>>> AB
>>>> 
>>>>> On Aug 7, 2015, at 9:12 AM, Douglas Sharp <douglas.sharp at gmx.de>
>>> wrote:
>>>>> 
>>>>> AFAIK Marketing is now the top level and covers customer relations,
>>>> repairs, returns, complaints and technical matters.
>>>>> 
>>>>> Cheers
>>>>> Douglas
>>>> 
>>> 
>>> 
>>> 
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>>> 
>> 
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>> 
>> 
>> 
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> 
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