Australian Members

[elvish]



I look at it differently.

Even if a store was to stock high quality shoes at $250 a pair, it won't work. It will always, by basic logic, be cheaper to buy online and ship to home. Even with economies of scale, the saving to the consumer for buying locally would be extremely small, and that assumes that a local retailer can achieve economies of scale.

Look at Rebel Sport, they sell top of the range runners, yet even with their size they can't sell them for cheaper than their International competitors.

My point is: you won't ever make money reselling shoes that can be bought online. There is no money in buying mass C&J and then trying to sell them cheaper than for what the English internet market is selling them for.

can't or won't? There is an Aus store based in Randwick that sells cheaper than Rebel and mainly uses online sales but has a warehouse for collection...

 

[Prince of Paisley]



Look at Rebel Sport, they sell top of the range runners, yet even with their size they can't sell them for cheaper than their International competitors.

can't or won't? There is an Aus store based in Randwick that sells cheaper than Rebel and mainly uses online sales but has a warehouse for collection...

Fine theories but Rebel Sport makes a profit...

 

[Journeyman]

I don't think that it's necessary to go quite as far as creating your own brand of shoes.

Realistically, I think that there is a sufficient number of people around to maintain a shoe store selling mid- to higher-end shoes, as long as the prices charged are reasonable compared to overseas prices.

Consumers do realise that there are economies of scale involved in selling things, as well as the "tyranny of distance", and so I think that most people are accepting of a mark-up compared to overseas prices, as long as that mark-up is reasonable. The problem with current clothing and footwear prices is that the mark-up does not appear to be reasonable, hence the desire to purchase overseas to avoid being utterly shafted.

Good service and good ambience is also key. Looking at myself as an example, I've happily bought a lot of stuff from Herringbone when I could, potentially, have bought very similar suits online from overseas businesses for quite a bit less. However, I was happy to pay more to buy from Herringbone because I liked the product, I liked the staff, they were quite knowledgeable about clothing and about the brand's products and they provided me with great service (such as calling me to let me know that a new shipment had come in with items that I might like and that they'd put some aside in my size), and it meant that I could be sure that the suits would fit me as I could try them on before buying them. I found that it was worth paying a premium for the above reasons.

Shoes are, of course, similar. As many people have discovered, buying shoes from overseas is fraught with risk. There are two reasons to take that risk - because you either can't get the shoes that you want in Australia, or you can get them but you will pay two or three times as much for the privilege and you'll have to deal with ignorant, unhelpful staff whilst paying through the nose.

I could be wrong, but I think that if someone can offer good quality shoes at reasonable prices here in Australia, in a business that is staffed with pleasant, knowledgeable people who provide great service, then they will get customers.

 

[JimmyHoffa]

can't or won't? There is an Aus store based in Randwick that sells cheaper than Rebel and mainly uses online sales but has a warehouse for collection...

If they can deliver shoes to the door at a price better than their international competitors then they are really in with a shot.

Fine theories but Rebel Sport makes a profit...

So does Henry Bucks?

Rebel Sport, I know for a fact, has had declining profitability over the last 3-5 years.

There are people that don't want to wait 10 days for their shoes to be delivered so they just buy it from the shop. I am sure they are well aware they are paying a premium for this service.

However, at the end of the day, the shop will always be capped in business because someone else can sell the exact same product at a lower price.

 

[JimmyHoffa]

I don't think that it's necessary to go quite as far as creating your own brand of shoes.
Realistically, I think that there is a sufficient number of people around to maintain a shoe store selling mid- to higher-end shoes, as long as the prices charged are reasonable compared to overseas prices.
Consumers do realise that there are economies of scale involved in selling things, as well as the "tyranny of distance", and so I think that most people are accepting of a mark-up compared to overseas prices, as long as that mark-up is reasonable. The problem with current clothing and footwear prices is that the mark-up does not appear to be reasonable, hence the desire to purchase overseas to avoid being utterly shafted.

If they could cut their margins substantially more, they would.

It took me a while to realise that I am prepared to pay a hefty premium for O&J clothing, an Australian retailer. Under normal circumstances, I wouldn't be prepared to pay such a mark-up.

 

[California Dreamer]



A quick trip to Henry Bucks for their $10 white linen pocket square in support of Prostrate Caner (very appropriate in Movember spirit).
http://www.henrybucks.com.au/store/Prostate-Cancer-Handkerchief.html

I'm sorry, but "Prostrate Caner"? WTF?

[/nitpicking]

 

[thebrownman]



If they could cut their margins substantially more, they would.

It took me a while to realise that I am prepared to pay a hefty premium for O&J clothing, an Australian retailer. Under normal circumstances, I wouldn't be prepared to pay such a mark-up.

Prepared? Premium?

I don't see how O&J's good are commanding a hefty premium. Perhaps it's not a question about "mark-ups" and more your definition of both reasonableness and a reconsideration of what your circumstances are.

Stuff costs money. Pay it or curb your desire.

EDIT: Emphasis my own.

 

[quar]



If they could cut their margins substantially more, they would.

It took me a while to realise that I am prepared to pay a hefty premium for O&J clothing, an Australian retailer. Under normal circumstances, I wouldn't be prepared to pay such a mark-up.

WTF are you talking about? What hefty mark up? What are normal circumstances?

 

[Prince of Paisley]



Rebel Sport, I know for a fact, has had declining profitability over the last 3-5 years.

So has just about every retailer in Australia and around the world... it doesn't necessarily mean it's structural decline.

Price is not the only competitive advantage a retailer (or any business) can leverage, which it what you seem to be getting at.

 

[Pink Socks]



I'm sorry, but "Prostrate Caner"? WTF?
[/nitpicking]

Hmmmm.....maybe I should be working harder or paying more attention when posting here....obviously trying to do the two together is not working. Will fix original post.

Mea culpa.

 

[Pink Socks]



A quick trip to Henry Bucks for their $10 white linen pocket square in support of Prostate Cancer (very appropriate in Movember spirit).
http://www.henrybucks.com.au/store/Prostate-Cancer-Handkerchief.html

Sorted.

 

[JimmyHoffa]

Prepared? Premium?
I don't see how O&J's good are commanding a hefty premium. Perhaps it's not a question about "mark-ups" and more your definition of both reasonableness and a reconsideration of what your circumstances are.
Stuff costs money. Pay it or curb your desire.
EDIT: Emphasis my own.

WTF are you talking about? What hefty mark up? What are normal circumstances?

Hefty was too strong a word.

Given O&J's size and location relative to the rest of the world, each individual pair of chino has to be marked up from cost to make the operation worthwhile. If they were selling 50,000 pairs of chinos a year, they would be able to lower the price of the chino from what it currently is. In other words, the markup would be lower. They also have to charge GST and the like. With all this considered, they aren't the only producer of Italian Chinos, nor are they the cheapest. This means, before service, they are already behind the eight-ball given the circumstances of geography and scale.

It then relates back to what James said, because Romp is a great contributor on the forum and I know what he wears and buys, I am certain that the quality of Chinos are great. Hence, I am prepared to pay more for something that isn't the cheapest option. 4 months ago I would have overlooked O&J.

So has just about every retailer in Australia and around the world... it doesn't necessarily mean it's structural decline.
Price is not the only competitive advantage a retailer (or any business) can leverage, which it what you seem to be getting at.

Well, I just question the viability of opening up a shop front in the city and trying to sell already widely available high-end English shoes. All I am saying is, in my opinion, a retailer will have to bring something new to the market, not just be a middleman. Regardless of how good the service is.

 

[thebrownman]



Hmmmm.....maybe I should be working harder or paying more attention when posting here....

I face this conundrum daily.

 

[Journeyman]



If they could cut their margins substantially more, they would.

It took me a while to realise that I am prepared to pay a hefty premium for O&J clothing, an Australian retailer. Under normal circumstances, I wouldn't be prepared to pay such a mark-up.

But why is that? O&J sells nice stuff, but it's not as though similar clothes are unattainable elsewhere - you can get similar shirts from Land's End, similar trousers from various places, similar shoes from various places and so on. So why are you prepared to pay more for O&J's products than other products that are similar?

Is it because it's a local business (albeit one that sells clothing made overseas)? Is it because the products are high quality? Is it because they are made in Italy and the US? Is it because you know that one of the owners is a likeable member of this forum who makes useful contributions?

I suspect that it's probably a mixture of most or all of the above points that makes you prepared to pay more for one of Romp's shirts/pairs of trousers/driving mocs.

Price is not the only competitive advantage a retailer (or any business) can leverage, which it what you seem to be getting at.

+1 - precisely.

I think that this is reflected in Michael Sy's post above - even though O&J's products cost more compared to some similar products, Michael is prepared to pay a higher price and the reasons for that might be tangible (higher quality, for example), or intangible (good customer service, or perceived status, or brand loyalty, for example).

As I opined a few posts back, I think that there are lots of Australian consumers who are prepared to pay a higher price, as long as they consider that they are getting some extra value for the price that they pay.

That extra value may simply be the opportunity to try the shoes on, or it may be very helpful, knowledgeable, friendly and personalised service - perhaps a shoe store where the staff are clearly passionate about shoes, they remember who you are, they remember your shoe size, they offer to shine your shoes when you come in for a visit, and so on.

The sad thing is that there are so few businesses here in Australia (well, here in Brisbane, at any rate) that are like that. Good customer service seems largely non-existent in a lot of retail businesses here, despite the fact that they can live or die depending on the quality of their customer service.

 

[Petepan]

Sounds like an SF Australian Members' wet dream!
Watch it go broke.

Probably have to agree there, unless they throw something really exceptional into their whole offering. Product focus too narrow. Some years ago, I was mulling the idea of a store selling high end raw denim. Then That Store came...and went just as quickly. I spoke to the owner of another store who told me that it is very difficult to resell a narrow product focus in Australia. His store is doing well, and he sells high end denim too, but his secret sauce is that he is selling a lifestyle with uniquely procured products to a captive and loyal customer base accumulated over many many years. He makes money from accessories and lower ticket priced items which have good margins and high turnover. He barely breaks even on the high end stuff.