Archived posting to the Leica Users Group, 2000/01/03
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Wether "photo" or "astrology" or "machine guns",
this, below, IS the name of the game.
AJQ
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1/ Any manufacturer (service provider) has to come up with a viable
business equation, to himself, to the retailer
the very same as to the investors.
2/ demand is the mechanism of choice here
3/ sustaining demand is quite an exercise
4/ if offer exceeds demand, through manufacturing over-capacity,
new competition, new technologies, uncontrollable market
factors (economic conditions), more successful marketing
schemes from competing manufacturers/retailers,
competitors' better management and business position,
prices, and profits (manufacturer / retailer), will go down
5/ we can theorize ad infinitum, at one point there
has to be a sale and a profit level worth the effort
to all the people involved on the OFFER SIDE
6/ what about RELATIVE VALUE and the PERCEPTION of value ?
7/ enter technology, R & D, industrial design and cosmetics,
advertising, sales personnel development & "formation" . . .
or, literally, indoctrination
8/ what level of profits is acceptable to make it
a worthwhile enterprise ?
9/ what about PRESTIGE ?
WHY is prestige VALUED ?
HOW is it a strategic leverage in business relationships ?
10/ what about SYNERGY -- e.g. a given line or model's
ability to bring in a more or less aware LEVERAGE
- in the business relationship (manufacturer(s) / retailers)
- in the sales relationship (retailer(s) / retail customers)
regardless of profit level this specific line or model can generate
on its own FOR ITS BEING PRESENT IN A GIVEN SALES AREA
OR CONTEXT, even if out of reach to 99% of a given market ?
11/ what about RESIDUAL VALUE of a given line and/or model ?
To make it plain: what's 'it' really worth, a few years down the
road, or the very moment the product leaves the retailer's
premises, when all the bullshit withers away ? (gross but exact notion)
AND, as a "pre-owned" offer(ing) ? ( --> perceptions again ! )
12/ Retailing is both an art and a science. It's far more than
margins, product mix, inventory control, personnel management,
advertising strategies, marketing, point of sale development, etc.
BUT: MARKET CONDITIONS [ ! ] evolve, new people with different
attitudes / values / ideals enter given markets -- drawn to these
by the PROFIT MOTIVE. Some are a class act others are astute
bullshitters at best.
Success, species survival, is the name of the game.
13/ Price control IS a reality;
at the macro levels, at the micro levels ... [ read my lips ! ]
It may not necessarily come from direct price fixing,
but it sure as Hell is going to happen when a given market's
survival is at stake, one way or the other, sooner or later.
MARKET SURVIVAL: etch this 3D and full colour in your Mind.
14/ Enter attitudes / values / ideals:
to sell, the ultimate criterion it seems, does a given line or model
go only on price, proper,
- discount levels
- price point positioning
- whatnot "secondary considerations",
- whatnot "strategies"
or does it hold more SURVIVAL POTENTIAL when at the hands of QUALIFIED
(hot potato word and concept) people who can APPRECIATE, e.g. make known,
INCREASE / "SELL" a given line or model's "benefits" and "promises"
to a given potential customer so that there is VALUE ADDED right there,
at that STAGE of the whole BUSINESS PROCESS.
Discounters HATE that. "Classic" businessmen thrive on it.
"Hybrids" / "business clones" / "me too" sort of business OPERATIONS
are going to try and MIMICK the SURVIVAL TACTICS
of both the discounters and the "classics", DISPLACE their COMPETITORS,
and try and claim or RETAIN a DOMINANT MARKET POSITION,
would it be a VERTICAL MARKET or a NICHE MARKET,
M-A-R-K-E-T none the less ! ! !
Business is war, at one point or the other of the PROCESS.
HOW this happens, surviving, depends on the people involved
and it does get damn nasty, because there are damn bastards out there !
THAT's " THE WAY IT IS " .
It's become far more "JUNGLE" than the privileged few reading this
ever realize, in the retail business (not only photo markets).
Welcome to Planet Earth, Year 2000.
It's OK to have a dream, but the business end of it
is that you're going to have to MAKE IT WORK,
today, tomorrow, forever or EXIT THE MARKET !
Just a few considerations I wanted to share.
Darn, it's not even 6:00 AM ...! ;+)
No wonder Tarzan took to the woods ! <gr>
Andre Jean Quintal