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post #31 of 59
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Sigh. It is possible to maximize profit even while taking a loss on a particular product or product line. Ever hear of a loss leader? More than that, it's possible for management to think that they're maximizing profit while taking a loss on a particular product or product line.
Ever heard of Ispat? I understand what you are saying, but you are not reading what I have said, as I have addressed the issue of which you speak, again your are not being specific to the comapny, you are trying to use bookish theories.
post #32 of 59
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(esquire. @ 28 July 2004, 3:37) The flagship of RL in NYC is a example of something that loses money each month, but is kept afloat to provide a halo effect for the company. I don't know what the exact figures are, but they're not that signifigant to a company like RL.
Boutiques are notorious for loosing money, especially the ones on pricy real estate (Rodeo, 5th Ave, etc...). In this case though, it is obvious the more outrageous ones, such as the Rhinelander Mansion (RL flagship in NYC) and the SoHo Prada store, are more for marketing purposes and brand prestige.
Yes, the overtly (ludicrously?) expensive stores that are located in areas of immense property values may be only show pieces that help sell the brand and do not create any profits for the company (hopefully they break even)...but how many of those are there? Off the top of my head in the US, the stores that probably do not generate a profit are: 1)\tNYC: Madison Ave 2)\tChicago: N. Michigan Ave 3)\tPalm Beach: Worth Ave 4)\tBeverly Hills: Rodeo Dr 5)\tBoston: Newbury St (very nice store btw...ok, all the stores are nice) Ok, so that's 5 RL stores that probably do not generate a profit out of 55 retail RL stores and 118 Polo outlet stores. Obviously the company generates net sales of $1,170 million from these stores (plus the 61 Club Monaco retail, 7 Club Monaco outlets, and 22 Polo Jeans outlets). Jon.
post #33 of 59
Come to think of it Jcusey, I was not that clear in my first post, and I am sorry, basically what I am saying is; 1. Nobody would knowingly want to make a loss. 2. However, I am sure that Ralph Lauren realise that Purple Label may not be where the money is. (note; may as I do not know thae specifics of RL; and nor do any of you, to what I can perceive.)
post #34 of 59
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(Mike C. @ 28 July 2004, 7:49)
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Originally Posted by esquire.,28 July 2004, 3:37
The flagship of RL in NYC is a example of something that loses money each month, but is kept afloat to provide a halo effect for the company. I don't know what the exact figures are, but they're not that signifigant to a company like RL.
Boutiques are notorious for loosing money, especially the ones on pricy real estate (Rodeo, 5th Ave, etc...). In this case though, it is obvious the more outrageous ones, such as the Rhinelander Mansion (RL flagship in NYC) and the SoHo Prada store, are more for marketing purposes and brand prestige.
Yes, the overtly (ludicrously?) expensive stores that are located in areas of immense property values may be only show pieces that help sell the brand and do not create any profits for the company (hopefully they break even)...but how many of those are there? Off the top of my head in the US, the stores that probably do not generate a profit are: 1)\tNYC: Madison Ave 2)\tChicago: N. Michigan Ave 3)\tPalm Beach: Worth Ave 4)\tBeverly Hills: Rodeo Dr 5)\tBoston: Newbury St (very nice store btw...ok, all the stores are nice) Ok, so that's 5 RL stores that probably do not generate a profit out of 55 retail RL stores and 118 Polo outlet stores. Obviously the company generates net sales of $1,170 million from these stores (plus the 61 Club Monaco retail, 7 Club Monaco outlets, and 22 Polo Jeans outlets). Jon.
Jon, how come you seem to have very good buisness sense here, but on the NM card thread you were talking nonsense.
post #35 of 59
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Ever heard of Ispat? I understand what you are saying, but you are not reading what I have said, as I have addressed the issue of which you speak, again your are not being specific to the comapny, you are trying to use bookish theories.
Ah, yes, I failed to realize that you were talking in specific real-world examples.
post #36 of 59
kalra, I already posted this: Link Jon.
post #37 of 59
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(kalra2411 @ 28 July 2004, 7:33) Ever heard of Ispat? I understand what you are saying, but you are not reading what I have said, as I have addressed the issue of which you speak, again your are not being specific to the comapny, you are trying to use bookish theories.
Ah, yes, I failed to realize that you were talking in specific real-world examples.
I hope that my Internet writing ignorance does not show, but was that meant as sarcastic post or should I have taken it at face value? Jon.
post #38 of 59
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I hope that my Internet writing ignorance does not show, but was that meant as sarcastic post or should I have taken it at face value?
Face value? No, of course not.
post #39 of 59
Without knowing either the exact revenue generated by sales of the RLPL product line OR the cost structure behind it, arguing about its profitability or lack thereof may be fun, but it is complete speculation. I would guess that on such a small relative volume, it isn't a tremendous money loser unless their product managers are asleep at the forecasting switch. If it runs at a break-even, there's no reason to kill it regardless of whether it creates a promotional halo. RL himself obviously has fun with it, and if it isn't losing money and isn't tying up resources needed elsewhere, why would he stop doing it? If it runs at a modest loss, but achieves a promotional goal, there's again, probably no reason to kill it IF senior management views that loss as a promotional expense. Promotions always cost money--advertising dollars are what keep the media alive.
post #40 of 59
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(imageWIS @ 28 July 2004, 7:50) I hope that my Internet writing ignorance does not show, but was that meant as sarcastic post or should I have taken it at face value?
Face value? No, of course not.
Well, I had to be sure...I don't want any misunderstanding, that is how problems start. Discussions should be point/counterpoint, as long as the other person understands the point; if not the shit hits the fan faster than you can say "˜locked thread'. Jon.
post #41 of 59
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Quote"But, you've in no way proved that RLPL is profitable"Quote Did I not say: "I hope that when RL aims RLPL toward something, it is profit, as RLPL has from a financial standpoint been less than viable, costing the company money rather than making it." ?
My mistake; I missed this.
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I mentioned that it does not make sense as to direct profitability, I cannot speculate as to a greater "˜halo' effect, nor is the case that I cannot understand the "˜halo' effect, just that it is beyond my current writings which are directed at profits made only through the sale of RLPL items.
That is not how I read your comments; I believed you asserted that the RLPL is run for standalone profits. If you never asserted this, I apologize. (Although I suggest you re-read your posts to see how this was the impression.)
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And then RLPL fragrances appeared on the market, and the only reason I can assume this is to profit from the RLPL brand name (directly)...or is the RLPL fragrance an attempted to make people purchase Polo fragrances? (Which, incidentally has been on the market for quite sometime and has been popular all on its own).
I hope you realize this is a totally facile argument. No one said that the company wouldn't hope to achieve profits from RLPL, just that they might continue the line even in the face of losses, and that standalone profits might not be the primary objective of the RLPL line. Given that the fragrance line is likely licensed, why would they turn down the revenues, plus the benefits from the marketing of the fragrance? I know nothing of this fragrance, but I assume it is a premium priced product, which I would suggest would again help to elevate the image of our friend Ralph's products more generally.
post #42 of 59
[quote][quote=jcusey,28 July 2004, 8:46]
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Originally Posted by kalra2411,28 July 2004, 7:33
Ever heard of Ispat? I understand what you are saying, but you are not reading what I have said, as I have addressed the issue of which you speak, again your are not being specific to the comapny, you are trying to use bookish theories.
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Ah, yes, I failed to realize that you were talking in specific real-world examples.
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I hope that my Internet writing ignorance does not show, but was that meant as sarcastic post or should I have taken it at face value? Jon.
Face value. EDIT: because you did.
post #43 of 59
Chaps, University and Polo Jeans. Polo Rugby. Sea Captain line (nautical, their spring and autumn clothes have cool design). RRL (stylewise this is a casual label). RLX (sports line more on sky and racing style, I personally like the design especially for a spring jacket). Ralph Lauren Green Label. Ralph Lauren Black Label. Ralph Lauren Blue Label. Ralph Lauren Purple Label.
post #44 of 59
Where does black label fit in? I was under the assumption that it was on par with purple label, just a different style and cut to suits.
post #45 of 59
I had it at Ralph Lauren Purple Label Ralph Lauren Black Label Polo Ralph Lauren Rugby RRL Lauren by Ralph Lauren Chaps Club Monaco is also owned, but not advertised under the Ralph Lauren Label
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