Frame price increases caused by weaker dollar

[fusion]

This is a discussion topic directed at those wholesalers and retailers who will be impacted from proposed significant price increases due to the rising Euro. Some frame companies at Vision Expo were stating that 20% increases were coming. As someone who has both a retail and wholesale mindset, I am concerned. When the dollar became VERY strong years ago, we deliberately lowered our export prices to help our distributors. The proposed increases in frames from Europe will greatly impact suggested retail prices here in hte states. Reducing our margins can mitigate the price increases, but our cost of goods numbers are important to us in running our business, and given the struggles to deal with dead merchandise, get companies to work with us on exchanges, these price increases are a bit alarming.

Some frame companies that have traditionally made frames in Europe, are already moving some manufacturing to China. Obviously, this is a complex issue, but I think that some pressure should be brought to bear on the frame companies to understand that that US market, given the economic uncertainties we are currently facing, and te costs of supporting a war (which they may or may not support), is fragile and that significant price increases will be highly negative for many of the high end retailers who have supported their lines.

Of course, we MUST hold their feet to the fire if the dollar improves, which it may as a result of the upcoming election and INSIST that prices be lowered accordingly when the euro weakens....now how often have you seen them lower prices?????

I'm interested in hearing from others on this topic.

Fusion.

[Matthew]

The Euro went from like 1.20 Euro to 1.41 Euro to a Dollar over recent time.
I dont see how that translates into 3 to 10 dollar price hikes. :finger:

Its a conspiracy!! :angry:

[MarcE]

Of course when the manufacturing of European frames moves to China, they don't reduce the price even one penny.
I recently recieved new Via Spiga frames that had always been marked "Made in Italy", now marked "Made in China". No reduction in price. And as many of you know the retail price and pedigree of Via Spiga doesn't reflect a "Made in China" label.
Tura moved the production of Torrneau frames to China and decreased the price by about 12%. They are the exception.

Matthew,
Actually the dollar has weakened by about 35% over the last 2.5 yrs. The distributers and manufacturers absorbed the first 20%, the next 20% will be passed on to us. Then the distributers/importers tack on their fees, and the company (not neccessarily the mfg) triples the price and then adds 40% for the reps commissions. Don't forget to pay Ralph Lauren the $1B licensing fee.

[HarryChiling]

High end retailers who have supported them.......hold thier feet to the fire......

Take back control of your dispensary. Stop carrying these lines that don't meet your business objectives. If you rely on a branded product to sell, then you may not be as good an optician as you may have thought you were.

Over the past couple of years I have seen articles and educations pieces reinforcing branding, yet at the same time I have seen the various brands available go from decent quality to junk over that very sameperiod of time. What I recieve as a response from most opticians I talk to is a defensive attitude towards these branded products like without them the dispensary would go out of business. I have also seen the average COGs for most f these products increase almost by 40% over the past 5-6 years.

I won't buy junk, doesn't matter what the name is, I also price my frame according to quality and what they could retail for. If the whoesale cost isn't in line with the quality or the retail price I would have to charge then I don't want it.

Stop begging thse companies for their products and find something better.

[Chris Ryser]

T
.............Reducing our margins can mitigate the price increases, but our cost of goods numbers are important to us in running our business, and given the struggles to deal with dead merchandise, get companies to work with us on exchanges, these price increases are a bit alarming.

Its not the Euro that has gone up in value. The US Dollar has lost nearly 40% of its value over the last 2 years. This is nobodies fault than the US itself. The whole world has problems because of it. A price increase for products in general was in the coming.

Some frame companies that have traditionally made frames in Europe, are already moving some manufacturing to China.

Actually they have moved already a few years ago. There is maybe about 10% of frames made in Europe compared to 10 years ago.

Of course, we MUST hold their feet to the fire if the dollar improves, which it may as a result of the upcoming election and INSIST that prices be lowered accordingly when the euro weakens....now how often have you seen them lower prices?????

I'm interested in hearing from others on this topic.

Dont hold your breath, any election result will not help. With a national debt of $ 164,000 per man, women and child, 1,100,000 homes up for auction and a consumer credit card debt of $ 60 billion it will be a while until the Dollars will gain again.

[Andrew Weiss]

Harry and Chris have said it all . . .

We are best off, I believe, in keeping our focus on good quality product at a reasonable price. If it comes with a brand-name, so be it; if not, that's fine too. The number of people I've had who were looking for a specific brand over the past 10 years I can count on the fingers of two hands.

(OK, here come the jokes about how many fingers I have . . . )

[Chris Ryser]

Harry and Chris have said it all . . .

We are best off, I believe, in keeping our focus on good quality product at a reasonable price.

Andrew you are totally correct..............I believe the times of the riding the big waves are over, at least for a while.

Basic products from metals to chemicals and oil related materisls have made drastic price increases, transport companies are working at the old prices but are slapping on surcharges.

Manufacturers of any goods all over the world that have been selling their goods in US Dollars for years are presently collecting 40% less for the value charged and will have to adjust their prices in order to survive.

The US is in a catch is currently in a catch 22 situation. If the USA raises the interest rates foreign money will start flowing back to the US and the Dollar will gain value. But a few million more people will loose their homes and or jobs.

As the US has lowered the interest rates to save the people from loosing more no foreign money will be invested and the Dollar might loose even more value over the next few month.

I received a personal cheque in US Dollars in the value of $ 124.00 which I changed to Canadian Dollars this morning. Two years ago I would have received $ 148 Dollars Canadian............today it was $ 106.00.

As this is a general problem not only affecting opticians but just about every product on the market everyone will be having to face the music.

[Matthew]

How much is 35% When comparing the Euro to the Dollar??? I think we are talking cents here. At the most .35 cents.

[drk]

That's 35% of a $100 frame = $35

[Johns]

How much is 35% When comparing the Euro to the Dollar??? I think we are talking cents here. At the most .35 cents.

That's Luxotamathics!;)

[Chris Ryser]

That's Luxotamathics!;)
I would say my average customer stocks at least 50% brand names. MD accounts carry less -- Retail stores with no Doc or limited Doc carry much more. In Boston I would say its about 65% to 70% brands. (statement by Optirep on other thread)

If this would habe been Fezz it would have been Beerhics :cheers: