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Independents

I think the issue

 

is production runs. If you think of the cost of design (both case,dial and movement) as a fixed cost, then it almost makes sense. Price would go down sharply with volume, but that takes marketing and distribution.

If the brand does take off (Journe) and it becomes a status piece (RM) then you just keep the price up there because you can.

The big houses started as bespoke for royalty and then with machining, production for the masses. So they “start” from a different place than the independents. When the houses have demand issues, they consolidate which makes sense.

The existence of the independents to me is about the wealth gap returning to the days of kings and peasants. This drives the desire for bespoke and voila….

The other group ( micro brands ) exist as an answer to the question of what you do with excess capacity and machine availability. In a sense, they reconfigure what is available, to satisfy the demand for variety and can do so because the big houses cannot and should not cannibalize their own margins.

That’s my take, a lot of which is obvious, but I thought I’d try to make it coherent.

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