Vass distributorships, globalization, protectionism, etc...

I'm with zj and aportnoy. It is, frankly, mystifying why Vass would want to alienate influential customers like you guys. As for me, I'm quite content to keep supporting the boys in Northampton - who, I would note, allow Internet retailers to sell many of their RTW styles for much less than their retail outlets in the U.S.

Originally Posted by AlanC

Click to expand...

Sky Valet stopped carrying Vass, if I'm not mistaken. They may have some residual pairs remaining.

As did Louis Boston. Brothers Sky had some left over at 550 during the past fall. I am not sure they still have them, but they did remove the notice on the Sales/Event Section.

It's interesting to note Hugo Boss wants to work with Vass after discontinuing it Baldessarrini line. Seems like Boss would be better off with their existing line of shoes to match the black label suits price range.

Originally Posted by whoopee

Click to expand...

While they carried Vass, SV's prices were considerably lower.

Didn't they clear them out at something like $550? Curious that a dedicated shoe retailer catering to the high-end shoe crowd can't make the line work at a lower price, yet Vass is now limiting the U.S. supply to a higher price point.

Maybe there's some ironclad contract forcing Vass' hands?

Oh heck, why not beat a dead horse.....?

edmorel As I am sure you read my last sentence, I recognize the way the world works.

Click to expand...

Yes, but you also said that such behavior is collusion and/or illegal monopoly. Thus, you impute improper or illegal motives to their actions.

edmorel As for the stereo equipment, almost all but the highest, highest end (+$100,000) is available from multiple channels, usually within the same state if not city.

Click to expand...

First of all, this is not true; there are many small manufacturers who have a very limited set of dealers; further, the existence of minimum selling prices or other retail price agreements limits the availability of cut-price products, thus motivating the selection of a retailer on other criteria more consistent with the best-interests of the manufacturer.

edmorel Equating this situation with patent law is a huge leap.

Click to expand...

How so? How about equating it with Trademark law (another branch of intellectual property)? Doesn't the ownership of the Vass trademark give the Vass company the right to distribute its products as it sees fit? Hasn't the company invested time and money in promoting its brand?

edmorel I do begrudge Vass taking a step which only benefits BG

Click to expand...

Do you not think that Mr. Vass thinks this step benefits him as well? The USA is the largest market in the world for luxury goods, and you gotta start somewhere; certainly BG, as one of the finest menswear purveyors in the country's richest, most cosmopolitan city, may be seen as a good entry point for Vass into the US. While you (and others, including perhaps me) may think Mr. Vass is wrong in his assessment of the value of the BG relationship, that is a separate issue.

edmorel Mr. Vass and Halmos can do as they please with their product. As a customer, I can do as I please with my money.

Click to expand...

Agreed. However, in your earlier post you decried their actions as collusion and/or illegal monopoly and defined a 'free market' in a way contrary to law or economics. _____________________________________________________

zjpj83 But such strategies only makes sense when your product is in high demand, when there's a huge buzz, and when people simply can't wait to get their hands on your products without 1) paying over retail; or 2) waiting on a waiting list in order to pay retail.

Click to expand...

I disagree. This strategy can also make sense when you need a partner (be it a retailer, a distributor, or a promoter) who must make significant investments in promoting your product and/or your brand. Again, Vass has no presence or brand recognition in the USA, so it needs channel partners (Gabor, BG) who are willing to invest in the brand. A failure to protect these partners may well cause them to abandon the company, thereby hurting Vass. Brand development is a multi-year process, and it may well require dedicated and loyal channel partners, who in turn require a concomitant commitment from the manufacturer. However, I agree that for such a strategy to succeed, you must make it difficult to arbitrage the price differential. One way to do so is what Vass has done -- ie. to limit where its retailers can ship the product.

zjpj83 But why they think this will stop private parties from arbitraging the two markets is beyond me.

Click to expand...

Who said they expect to stop private parties from arbitraging the two markets? You can still fly to Germany or Hungary to purchase some Vass. Heck, you could most likely even fill up a suitcase with Vass shoes and come back and try to flog them on e-bay or SF. However, what they are doing is making it more difficult to arbitrage the two markets by preventing the shipment of goods from the German retailer directly to the US. There are two separate issues here: the appropriateness/legality/ethicality of the Vass/BG pricing and associated retail restrictions (as addressed by Edmorel in his original post); and the wisdom/intelligence underlying that strategy (as questioned by several). While the strategy may be stupid or misguided, that doesn't make it improper, illegal, or unethical.

zjpj83 Perhaps they don't want to expand capacity and are happy being a small market niche producer. It's certainly possible. Indeed, it had better be, because if they're banking on selling these shoes at these prices in the United States to the small number of either a) unsophisticated consumers who don't know any better or b) those who do know better but who have such much money that they don't care, then Vass is never going to be an Edward Green or John Lobb, period.

Click to expand...

Agreed. However, given that the Vass shoes are basically entirely handmade, whereas the Green and Lobb (RTW) are factory-made, machine-made shoes, I don't think Vass has any real expectations of being like them. Vass' ability to expand output dramatically is most likely pretty limited, as cordwainers take a lot longer to train than do factory workers.

Well, since I am still up..

Originally Posted by shoefan

Click to expand...

Such a policy protects the manufacturer's (necessary) retail outlets that invest in the provision of the opportunity to hear the equipment; failure to provide such a policy may lead to the failure of the manufacturer, and then who benefits from that? .
Your post ignores the success of many internet only electronics companies (Outlaw for one). Also, I am not aware of any manufacturer going out of business because their products are being sold online.

Originally Posted by shoefan

Click to expand...

Another analogy: patent law gives the patent holder a monopoly on the use of that patent. Is that a bad thing? Without intellectual property rights, there would be a lot less innovation..
Mr. Vass has not invented a new way to make a shoe.

Originally Posted by shoefan

Click to expand...

Finally, consider the Vass situation specifically. Hasn't Gabor invested several years of his time and money developing a market for Vass in the USA? Won't Bergdorf take on risk and expense by stocking and promoting Vass in the USA?
This is a contradictory statement. If time and money has been spent to develop a market in the US, what is Bergdorf's risk?

Originally Posted by shoefan

Click to expand...

Finally, a monopoly is not illegal per se; what is illegal is taking certain actions that (improperly) create, sustain, or exploit a monopoly.
Isn't not allowing a lower priced retailer to sell your goods in the same market where a much higher priced retailer exist creating and sustaining a monopoly?

Originally Posted by shoefan

Click to expand...

No one says the German retailer cannot sell to Americans -
Actually, that is exactly what Vass is saying. Theorectically, Vass should not care about the method of delivery from the retailer to the customer (in person, via mail).

This will be my last post as we can sit here and dissect each others post until the cows come home. At the end of the day, the market will decide whether this move was or was not beneficial to Vass.

Hello all,

I thought I might clarify some issues of legality.

First of all, the reference to illegal monopolies. Monopoly is not the correct expression, but the conduct referred to would potentially, at least under Australian competition law, amount to a restrictive trade practice.

"Price floors" are considered illegal anticompetitive behaviour, for the reason that they favour larger and more established retailers who are less reliant on discounting (or even loss-leading). Moreover, they hurt the customer. Refusal to deal with discounters can be subject to severe penalties, but in practice you can justify it on other nebulous bases, as well as applying for permission from the competition regulation authorities.

The reference to intellectual property law is interesting. There was a time when it was used to prevent "parallel importing" of goods outside of authorised distribution networks. In a famous case, the distributor of Bailey's Irish Cream sued parallel importers alleging breach of the artistic copyright in the tiny painting adorning the bottle, and succeeded.

Similar approaches were used against importers of music CDs until it was realised what an incredibly bad policy it was, and the courts and legislation variously overturned the judgments that it was based on. CD prices dropped immediately by about a third.

I believe the latter position also reflects the approach of US courts.

I don't know much about Vass, so I won't comment one way or another, but I certainly am tired of the Vuittons and Hermes' of the world with their no sale policies and artificially high prices.

Wow, between this thread and the one on Andy's, I've never seen so many sour grapes. No one bitches when LVMH doesn't put its overpriced crap on sale (OK, Prophete Faux does ) and there is NO way to argue that Vass shoes are worth less today than they were yesterday, or two weeks ago before the German retailer popped up. I for one hope all the crap most members are spewing doesn't drive off Andrew from being a fantastically informative member of the forum. Lets keep in mind that none of us would have heard of Vass were it not for his hard work. I see no problem with giving him a cut, as it were. Or just go to Budapest!

How much were Vass in Budapest again? Something around 400 Euros if I recall correctly, can anyone confirm? I wanted to take a short trip to Budapest at some point anyway...

Wow, I see that flames have erupted here as well. I’ve just spent 3hrs I didn’t have (I’m in the middle of a move) to address the thread on Ask Andy. So forgive me if I don’t answer in too much detail here. A link to what I’ve already written:

http://www.askandyaboutclothes.com/F...09&whichpage=2

You could also call that collusion or an illegal monopoly.

Click to expand...

Or not

Vass is helping BG maintain their outlandish margin

Click to expand...

The only problem is that everyone knows the shoes are astronomically and laughably marked up.

Click to expand...

I’ve said it before and I’ll say it again. Bergdorf’s price for Vass shoes is a fair retail price for the US market. I am not at liberty to post specific wholesale prices and markups here. But I can say in all honesty that the statements above are knee-jerk reactions, revealing a lack of knowledge of how the clothing market works.

As my previous post indicates, Vass is shooting themselves in the foot. The way to get a new brand known in a new country is to market it like crazy. This means letting as many people as possible get their hands on them so that when the owners are standing around the water-cooler and everyone's admiring their shoes, they can say who made them and get the word out. This is the opposite of what Vass is doing. You get people interested; then you cut the supply and make them pay full price.

Click to expand...

Actually, this is exactly what we did. We held several promotions at discounted prices, here, and at the Sartorial Excellence event, etc. to get the shoes on the feet of men who would appreciate them and talk about them. However, that was during periods that we did not have any retail points. The time for that has passed.

This is a contradictory statement. If time and money has been spent to develop a market in the US, what is Bergdorf's risk?

Click to expand...

Are you serious?



Zipj83 – You have some interesting theories about marketing Vass shoes. Consider Mr. Vass’ perspective though. He could sell a few pairs of shoes to US customers by allowing the German store to ship to the US. But by doing so he would be undercutting his US agents who are working hard to promote his product, and alienate potential US retailers. Which is the wise decision, long-term??

Anyways, I have to say that these threads have thoroughly ruined my day, and night. I thank those who have stuck up for me. But honestly, if this is how little currency I have on these forums after all the time I’ve spent here, I’m not sure that I’ll be sticking around.

Andrew, your posts were some of the most influential in getting me addicted to this F(*&^ing site back in the fall/winter of 2003. Your pictures, whether of your outfits or products, have always shown care, attention to detail, and intense devotion. Please don't allow the few members who care more about their own wallets than the lasting strength of a timeless maker turn you off to the community at large. We love you, man

Tom

Ditto.

I don't like to pay American businesses for certain things. For Vass shoes, I would sooner go to Hungary. The shoes cost less there. Tax goes to a government that is not involved in a military adventure in the Middle East. And the trip would be lovely. And the coffee would be better.

this problem comes up all the time

company 'x' has the rights to sell to the usa market
company 'y' has the rights to sell to the german market

company 'y' sells its product to the usa market despite treading on the distribution and/or exclusive rights of company 'x'

so i agree with a harris
even if there isn't an exclusive rights agreement, there is obviously some sort of distribution agreement that likely has the intention of protecting the usa market for that distributor until it at least becomes established

this is quite normal for everything from auto parts to medical supplies

of course the world of on-line shopping makes things more difficult but it's the same problem nonetheless

company 'y' should be forbidden from selling to the usa market under this scenerio

.... and yes i've simplified things for sake of posting but i have to agree with a harris

Originally Posted by tiger02

Click to expand...

Andrew, your posts were some of the most influential in getting me addicted to this F(*&^ing site back in the fall/winter of 2003. Your pictures, whether of your outfits or products, have always shown care, attention to detail, and intense devotion. Please don't allow the few members who care more about their own wallets than the lasting strength of a timeless maker turn you off to the community at large. We love you, man

Tom

Agreed (well, I don't know about "love," but I really, really like you ).

As financial realities currently restrict my purchasing of Vass shoes anyway, none of this has immediate direct bearing on me. I really understand aportnoy's frustration over losing his source.

I will add, however, that A Harris has always been a wealth of information for the board(s), and, along with jcusey and shoefan, has been one of our real shoe veterans. Much of what I know about shoes I learned from his posts. If you go back and look, A Harris was plugging Grenson long before Bennie's or much of anyone had heard of them. As any of us, he has his own business interests, but he has always been very free with information about a wide variety of labels including--and especially--shoes of all stripes. We need more posts from him, not fewer.