Luxottica selling??

[Crazy-bout-Optics]

Those of us at Lux and those watching have seen management dig the company into the ground, it is not the same place I used to work at 8 years ago.

So for those of us working at LC we have seen all the layoffs, the firing of managers, Regional Managers, etc. We have sale after sale, after sale where we used to only have 3 or 4 a year. Now we are changing to a 90 day guarantee and selling an insurance plan. We have this whole "culture shift" which is nothing but sales, sales, sales!

Basically Lux has cut payroll, has back to back sales and will be selling an eyeglass insurance plan insured by a 3rd party. They are increasing cash flow to make the company look more profitable, though I personally think it is just to inflate the perceived "worth" of the company. Could it be that Mr. Delvecchio has rode the gravy train and is wanting to sell and take the $$$ and run?

Who has the funds to purchase Lux, or any of its subsidiaries for that matter? Essilor Perhaps? Yes they are selling online through FD.com but they don't have physical retail stores nor frame manufacturing (That I am aware of). Sounds like a match made in ... .. (I'll let you finish that statement)

I think Zeiss is pulling out of the US market and concentrating on Europe where they are much more successful. They Just cant take on the behemoth that is Essilor here in the US. This all got me thinking that Essilor possibly has its eyes on Lux/LC.

Thoughts??

~CBO

[drk]

A toe-hold in the US should never be surrendered.

LC may suck for awhile, but I can't see Lux selling them off. No way.

Essilor can "make sweetheart deals" with Lux without buying the cow.

[Chris Ryser]

Zeiss has about 13,000 employees, is in many fields other than just eyeglass optics. check it out at: http://bib.kuleuven.be/ebib/data/jaa...ftung_2009.pdf

Zeiss has also acted in a similar way to Essilor in Europe where they bought up one lab lab after the other over the last 25 years. In India they have entered the retail market with a optical retail chain planned to up to 500 stores. http://www.gkboptolabs.com/about.php, they call them there Optical Showrooms.

Essilor made its entrance to the North American market by accident in Canada. In 1963 they had chosen a group of 5 Optometrists in Montreal as their Canadian Distributors with the CEO being the ex Montreal lab Manager of the American Optical local Lab. Four years later the company went bancrupt, and having too much stock at stake, Essilor had to take over the bancrupt distributor and continued operations as a directly owned subsidiary from headquarters in France.
The USA was added only a few years later, headquartered in St Pete FL.

History of Essilor: http://www.fundinguniverse.com/compa...y-History.html

They this corporation is working it way through time, I dont believe they would buy LC or other Lux chains in the USA, however I would rather go for the other concept, take over Luxottica as the largest and most agressive frame company who's owner is now in its mid 70s and will be thinking very soon about retiring.

Another reason for not going for optical chains could also be the fast developing on-line opticals that are a real threat to the optical retailers. Essilor has already entered that sector with the purchase of Frames Direct.com, the 2nd largest of them.
Their domination of the market is nearly completed with the aquisition of FGX, at http://www.fgxi.com/, the largest frame company with inexpensive products. What is still missing in their program are the quality frames and Lux might be the one.
Only time will tell.

[drk]

No way, Chris, respectfully.

There is a plethora of bare-bones frame suppliers available to Essilor if they had such interest, without the hugely expensive colossal retail apparatus and wholesale frame apparatus on Luxottica's balance sheet.

If they want frames, buy up a couple of factories in China.

[Flat Eric]

Its more than just frames though, it's unbridled access to all the prestige brands that go along with it - Gucci, Chanel, Oakley, Prada, Bvlgari, etc. etc.

[drk]

When is a prestige brand not a prestige brand? When you can buy it over the internet.

Over time (and not very long at that), I have a feeling that the prestige would somewhat deflate.

And when the design houses see their brands drug through the http.mud.com, they'd give a second thought to their licensing agreements, I'd say.

The only reason it's such a "deal" to get frames online is because it has a referent...that is normal retail. Once normal retail is gone, then a frame's a frame.

[Flat Eric]

When is a prestige brand not a prestige brand? When you can buy it over the internet

Can't entirely agree with that - prestige is in the perception of the consumer. They see Gucci, Chanel, Oakley, etc. as high value brands, higher cost, presumably (but not necessarily) higher quality, and that is independant of whether they can buy over the internet or have to travel personally to Milan to buy them from an exclusive outlet nestling on the shores of lake Garda.

I do agree, however, that opening up mass availability eg via internet retail, does erode the value position over time, then there will be new brands popping up offering same old stuff under a different name - all things have a life cycle. INternet access vastly reduces the life cycle and increases the turnover rate.

[drk]

We agree, Flatty.

In general, online contacts and glasses are only attractive in the "we're-getting-away-with-murder-compared-to-traditional-retailing" phase, then it will have to be evaluted solely on its own merits.

Internet eyewear is like internet dating.

[Spexvet]

Those of us at Lux and those watching have seen management dig the company into the ground, it is not the same place I used to work at 8 years ago.

So for those of us working at LC we have seen all the layoffs, the firing of managers, Regional Managers, etc. We have sale after sale, after sale where we used to only have 3 or 4 a year. Now we are changing to a 90 day guarantee and selling an insurance plan. We have this whole "culture shift" which is nothing but sales, sales, sales!

Basically Lux has cut payroll, has back to back sales and will be selling an eyeglass insurance plan insured by a 3rd party. They are increasing cash flow to make the company look more profitable, though I personally think it is just to inflate the perceived "worth" of the company. Could it be that Mr. Delvecchio has rode the gravy train and is wanting to sell and take the $$$ and run?

Who has the funds to purchase Lux, or any of its subsidiaries for that matter? Essilor Perhaps? Yes they are selling online through FD.com but they don't have physical retail stores nor frame manufacturing (That I am aware of). Sounds like a match made in ... .. (I'll let you finish that statement)

I think Zeiss is pulling out of the US market and concentrating on Europe where they are much more successful. They Just cant take on the behemoth that is Essilor here in the US. This all got me thinking that Essilor possibly has its eyes on Lux/LC.

Thoughts??

~CBO

Luxottica/Lenscrafters has done this many times since I started with them way back in '87, you young whippersnapper. It's all about profit/share price. Maybe Leonardo needs another Lamborghini.

[Crazy-bout-Optics]

Luxottica/Lenscrafters has done this many times since I started with them way back in '87, you young whippersnapper. It's all about profit/share price. Maybe Leonardo needs another Lamborghini.

I understand rounding up profits for shareholders, but I think it is beyond just increasing cash flow and basic profit per share.

[Crazy-bout-Optics]

A toe-hold in the US should never be surrendered.

LC may suck for awhile, but I can't see Lux selling them off. No way.

Essilor can "make sweetheart deals" with Lux without buying the cow.

Sweethearts huh? Does this make Lux and Essilor friends with benefits? :)

[canaanlilli]

Sweethearts huh? Does this make Lux and Essilor friends with benefits? :)

LMAO...that is all I have to say.

[RMiller58]

Lux cried how poor they were the whole time I worked for them so I don't see this as anything new.