mr.orange
Distinguished Member
- Joined
- Nov 18, 2010
- Messages
- 1,605
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You're not seeing the big picture. Luxury goods collection lines usually lose money, but they bring prestige and buzz to the brand. They make their money from cosmetics, fragrances (both of which costs essentially nothing to make) and accessories. Think about how many places sell the Gucci collection, and how many places sell Gucci fragrances. Designers with lots of lines like Ralph Lauren? The low end lines (Chaps, Lauren by Ralph Lauren, Polo, Polo Sport, RLX) can be found in any department store. These are the lines that sell. But the black label, the purple label, RRL - these lines give them credibility to different audiences. Also, they help sell the fragrances, which are essentially the cheapest buy-in to a lifestyle brand.Originally Posted by LA Guy
Other high margin items are sneakers and tees. You really have to pull out all the stops to make a sneaker with $50 material and manufacture costs. A tee? C'mon now. It's hard to make a $15 tee.
So RRL isn't a cash cow like I previously thought, it just gives the brand credibility. Mmmm....yes that makes alot more sense and why Ralph can "afford" to keep RRL running.
thanks, I feel much more edumacated
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