Leica's growth plans

[AlanG]

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I agree but I think to every reaction there comes a counter-reaction. I think Leica in the future could be a (small) one-stop-shop for film M too. You could buy a film M, film rolls and get it developed and enlarged the traditional way in store. At least in some of the larger Leica stores.

 

Now that is an outside the box idea.

 

I know you are being genuine but is this not just your wishful thinking that surely can't be their plan? They could do this but only if you want to emphasize the word "small." What percentage of Leica's .15% market share is comprised of film cameras today?

 

I doubt I could afford what Leica would charge for printing. If there are a number of Leica stores 10 years from now they will need to rely on more than film based products.

[Ellie]

Now that is an outside the box idea.

 

I know you are being genuine but is this not just your wishful thinking that surely can't be their plan? They could do this but only if you want to emphasize the word "small." What percentage of Leica's .15% market share is comprised of film cameras today?

 

I doubt I could afford what Leica would charge for printing. If there are a number of Leica stores 10 years from now they will need to rely on more than film based products.

 

Yes this will probably be small, and expensive, but Leica has exhibitions in some stores and some are done with film M. It's logical that Leica will offer customers to buy a film M and make similar artwork. The history and roots are important.

 

I think the Leica range be more into digital though.

[janki]

It is an idea I like very bad, - but perhaps it is a good thing for Leica in the end to do as Zeiss, - concentrate on development and production of lenses with different mounts, and let the three big take the cost of constantly developing new digital camera bodies.

If it is possible to achieve 1% of the market only with lens production for other brands, is in the other hand an open question?

Does anyone know how much of the market for lens production that Zeiss has today?

[Ecaton]

Just read in the German forum that Leica plans to increase its own stores from presently 25 to 2000, according to a Sunday newspaper report. A very capital intense strategy, but one that helps boosting top line, as higher retail prices rather than manufacturer sales will be recognized in Leica's books. And the retail margins seem to justify investing in costly store space.

[andybarton]

Japanese competition law prevents Leica, or anyone else (not owned by the Japanese), making lenses for Canon, Nikon or Sony.

[Ellie]

Just read in the German forum that Leica plans to increase its own stores from presently 25 to 2000, according to a Sunday newspaper report. A very capital intense strategy, but one that helps boosting top line, as higher retail prices rather than manufacturer sales will be recognized in Leica's books. And the retail margins seem to justify investing in costly store space.

 

It's a strategy I've seen other very successful high end brands use. I'm not sure the prices needs to be higher though, the retail margins are 50% of the sale price for some products already. The retail margin will also be higher with a larger sales volume. Setting up that many stores they'll probably use standardized interiors etc too.

[Ecaton]

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It's a strategy I've seen other very successful high end brands use. I'm not sure the prices needs to be higher though, the retail margins are 50% of the sale price for some products already. The retail margin will also be higher with a larger sales volume. Setting up that many stores they'll probably use standardized interiors etc too.

 

What I said is that Leica's revenue will reflect retail in lieu of manufacturer prices. The former are obviously higher. "Higher" referred to the difference between the two prices.

[wattsy]

Japanese competition law prevents Leica, or anyone else (not owned by the Japanese), making lenses for Canon, Nikon or Sony.

 

Do you have a source for that? Zeiss are not owned by the Japanese (though I accept that they manufacture their ZF and ZE lenses in Japan) and Angénieux made lenses (in France?) for Japanese lens mounts for years. I'd imagine that there are practical difficulties for any company to reverse engineer the EOS and F mounts without Canon and Nikon cooperation of some sort (and this might be less forthcoming for companies outside Japan) but it being a matter for Japanese competition law sounds like bollocks to me.

[andybarton]

It's been mentioned several times before on this Forum - when I get time I will do a search and see what I can find. Doesn't mean it's not bollocks, of course.

[andybarton]

<snip> the retail margins are 50% of the sale price for some products already. <snip>.

 

Not for Leicas.

[Ellie]

Not for Leicas.

 

Well then my Leica reseller was lying when he told me I could not get more when I traded in my X1 than what he payed for new ones to Leica (~50% of the new price)

[andybarton]

I can't comment on that, but I do know that the dealer margin on new Leica quipment is nowhere near 50%.

 

If you are trading something in, then the dealer has to take a lot of things into consideration, including offering warranty cover (which he doesn't on a new product), plus much depends upon demand for a particular item. If no one wants used X1s, of course he's going to offer you a low price.

 

I once asked my dealer whether he would be interested in my old CM. "Would I?!" he replied. He had another customer looking for one, so he gave me an excellent price for it - more or less what I had paid a couple of years previously.

 

If it had been destined to sit on his shelf, he wouldn't have been so generous.

[jaapv]

It's been mentioned several times before on this Forum - when I get time I will do a search and see what I can find. Doesn't mean it's not bollocks, of course.

 

I think you are referring to the Keiretsu system which compels companies indebted to a certain bank not to do business with companies outside that group. It is not law, afaik.

[andybarton]

Thanks Jaap

 

That's probably it. The Keiretsu page in Wikipedia makes for interesting reading - it makes a "closed shop" arrangement over here look like free-market capitalism gone wild

[mmradman]

Thanks Jaap

 

That's probably it. The Keiretsu page in Wikipedia makes for interesting reading - it makes a "closed shop" arrangement over here look like free-market capitalism gone wild

 

Where there is a will there is a way. To serve future 2000 shops Leica will need to increase goods production, lots of goods.

 

It is easily resolved, take a loan from the Japanese bank, join the club, after all Panasonic is Japanese business already in cartel with other camera makers (4/3 system).

 

If bank refuses offer one-off camera(s) for the top man/men in the bank, we all know Leica very popular in Japan .

 

If still problem commit harakiri.

[earleygallery]

Yes this will probably be small, and expensive, but Leica has exhibitions in some stores and some are done with film M. It's logical that Leica will offer customers to buy a film M and make similar artwork. The history and roots are important.

 

I think the Leica range be more into digital though.

 

If Leica are going to open that many stores - which in this age of clicks & bricks retailing seems somewhat bullish, brave or foolish - they could indeed be like upmarket lomo stores, offering D&P, scanning and film sales (not all stores would need to offer on site services of course, but a drop off/collection point).

 

As Leica are one of the few remaining film camera manufacturers it would make perfect sense to offer such services to support their use, as well as drawing customers into the stores on a regular basis!

 

But, I have doubts that the store numbers are realistic or even necessary. Yes they will earn more profit but with much higher operating costs too. Maybe they will be franchises, but then they have to work hard on quality control, not one of their strong points!

[janki]

From what I've read, it's been a big problem for Apple after they began to open their own stores in China that it suddenly pops up fake Apple Stores everywhere.

Since the main area to Leica in the future will be in countries like China, this will certainly be a problem for them.

With 2000 new stores, it can become difficult to keep track of all, - at least for customers, - which stores are false and which are real?

 

As a curiosity I can mention that the Norwegian customs authorities a few days ago seized a large batch of brand new iPhone5´s. :D

So, show at least some skepticism if you suddenly being offered a brand new Leica S3 a little too cheap in one of these new Leica shops.

[NZDavid]

If Leica are going to open that many stores - which in this age of clicks & bricks retailing seems somewhat bullish, brave or foolish!...

 

Good point. I would imagine we will see none of them in small countries, only in big cities in a few countries. Some of these designer stores tend to be off-putting.

 

I liked the look of the Singapore Leica store near Raffles -- although the staff could have been more outgoing. We did enjoy the B+W photo exhibition in the store though.

 

Bottom line: excellent customer service, as well as product line-up, is a crucial part of future growth plans.

[earleygallery]

Bottom line: excellent customer service, as well as product line-up, is a crucial part of future growth plans.

 

Indeed David. I think it would be the wrong move for Leica to roll out the 'boutique' concept. The stores may look smart but I can imagine many people being put off by something that looks to exclusive/expensive.

 

Clearly Leica are going to be aiming more downmarket to acheive their growth targets, and they need to tailor their style accordingly, with something more 'approachable' and also more interactive for the customers.

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Hallo,

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[Lightwrangler]

May i point your attention to the fact that the 2000 Leica-shops is indeed a typo by some german newspaper which they meanwhile corrected themselves. They placed a zero too much. The plan is 200 shops, not 2000.

 

Mike