Kaufmann again: Interview Popular Photography May 2008

[Chriscrawfordphoto]

Dear Christopher,

Ah, I see. That didn't occur to me because it didn't occur to me that anyone would feel sorry for a company. If they like the product, and want the company to stay in business, then obviously they have to buy the product new, but that strikes me as enlightened self interest, not charity.

Likewise, It hadn't occurred to me that buying used was in any way 'wrong'. The real puzzle to me, though, is that so many people think they can run Leica better than Leica can.

Of course Leica will pay attention to anything that is said about the company; but the weight they attach to what is said must inevitably vary according to several things. One of the most important must surely be whether the people in question know very much about running a camera company. Another is whether the people making the criticism (or offering the praise) are actual customers; potential customers; or hot-air merchants.

Cheers,

Roger

People think they can run Leica better than Leica's management because we in the USA see a LOT of poorly managed companies that everyone knows are mismanaged, yet the companies' managers keep screwing them up. That may be less common in Europe, but here in the USA, corporate managers are raping their companies to squeeze every bit of short term profit from them as fast as possible and if the company dies in the process...well who cares, the executives got rich and can walk away rich leaving customers, employees, stockholders, and the communities the companies operated in to deal with the mess.

 

[Roger Hicks]

People think they can run Leica better than Leica's management because we in the USA see a LOT of poorly managed companies that everyone knows are mismanaged, yet the companies' managers keep screwing them up. That may be less common in Europe, but here in the USA, corporate managers are raping their companies to squeeze every bit of short term profit from them as fast as possible and if the company dies in the process...well who cares, the executives got rich and can walk away rich leaving customers, employees, stockholders, and the communities the companies operated in to deal with the mess.

Dear Christopher,

Well, yes. Many people inside Leica say that the worst thing the company ever did was to go public. Which is why many of the same people reckon that Kaufmann's taking it private again is good news: no more short-termism.

Cheers,

Roger

 

[veraikon]

some background informnation from the Economist (UK)
http://www.economist.com/business/displaystory.cfm?story_id=11413199

 

[Roger Hicks]

some background informnation from the Economist (UK)
http://www.economist.com/business/displaystory.cfm?story_id=11413199

Much as I admire The Economist, this looks about as well-informed and well-researched as at least 20 internet threads I've read on the same topic.

Trust me -- I'm a journalist.....

Cheers,

Roger

 

[kevin m]

Trust me -- I'm a journalist.....

A life form held in only slightly higher regard than politicians and used car salesman at the moment, Roger. 😉

 

[Roger Hicks]

A life form held in only slightly higher regard than politicians and used car salesman at the moment, Roger. 😉

Dear Kevin,

And you were the one who accused me of having no sense of humour...

Stop and think about the fact that the article was written by a journalist.

Cheers,

Roger

 

[dcsang]

Much as I admire The Economist, this looks about as well-informed and well-researched as at least 20 internet threads I've read on the same topic.

Trust me -- I'm a journalist.....

Cheers,

Roger

Roger,

Just out of curiosity; what part of the article seems to be suspect to you?
I am wondering what part of it is ill-informed. Could you be specific?

Thanks,
Dave

 

[Roger Hicks]

Roger,

Just out of curiosity; what part of the article seems to be suspect to you?
I am wondering what part of it is ill-informed. Could you be specific?

Thanks,
Dave

Dear Dave,

It's speculation about a company that was once publicly owned and is now substantially private.

No-one doubts that Leica had problems, but it's a bit like comparing countries before and after a general election (or in the US, a presidential election). Did Dubbya run the US the same way as Slick Willie? Not exactly...

I see no new facts in the piece; no persuasive numbers, new or old; nothing that convinces me the author had any particular knowledge of the subject. Without wishing to be rude to the author, and as I say, despite my very high regard for The Economist, it looks like, "Can I have 500 words by Tuesday?" EDIT prompted by the news about Porsche Consulting. Did the author go to Solms? I'd be surprised.

Which led to "Trust me, I'm a journalist..."

Cheers,

Roger

 

[yanidel]

You have to talk with your money. Buying used makes you a tourist in the corporate world. Didn't you know that?

Ned, it is nice to throw statements like that but some argumentation on why you think so would be appreciated. I am in the corporate world, and USED is a very important part of the equation for us. When selling new, one of the argument we bring forward is the high resale values to justifiy the premium we are asking for (together with reliability and durability). And used is also a large part of dealer profitability, which is essential to any manufacturer for long term viability of their network. So please, describe your corporate world, maybe you are in the tourist industry ?😉 But being yourself the thread starter, a bit of an elaborate argumentation would be great.

 

[benlees]

You have to talk with your money. Buying used makes you a tourist in the corporate world. Didn't you know that?

Huh?

Parts and service? I'm sure the camera world is a least similar to other businesses such as the automotive businesses. Mom and Pop services are drying up. Dealer service brings in money for new and used products. They can make money from many different owners when they already profited from the original sale.

Used products create brand loyalty with little overhead for the company. If they make a good product they will get customers for their new products. A company should listen to every potential buyer.

 

[tomasis]

Service and parts dont give much money. Second used gear are not coming from Leica so it cannot make any profit unless they sell more new bodies and lenses.

it is simple logic.

 

[benlees]

Service and parts dont give much money. Second used gear are not coming from Leica so it cannot make any profit unless they sell more new bodies and lenses.

it is simple logic.

Obviously. But...read again the first sentence of the second paragraph in my post. Logic, let alone rationality, doesn't have a lot to do with marketing; companies can create demand as well act from it. Leica's licensing deal with Panasonic is a good example of the potential market for their higher end products. Leica and Panasonic know that the Leica name has marketing power. They care if you buy one, used or not. Sure they want the most money out of you up front but they would rather have you buy a used Lumix than a Sony.

 

[AlanG]

Isn't it Leica's responsibility to make some new gear that is compelling to buy? Don't blame the users of used gear if Leica hasn't given them sufficient reason to get rid of their old gear and buy new.

 

[tomasis]

let say "rich" guys buy expensive stuffs then they sell them cheaper to "poor" people so it creates larger market. Can we complain if there are M bodies with all possible prices from $300 in bad condition for oldest M to collectibles for millions dollars. I dont mind a diamond on the leica M top 🙂 when I get it from a queen.

I dont think that even "poor" budget minded people buys used digital stuffs like used Lumix 😀 with reason that digital breaks soon or later. If somebody wants something electronical focus aid in VF and AF focus for M, it doesnt mean that Leica will do what future buyers want and there are bigger demand for better profitability. I think Leica tries to follow own philosophy when they create so durable products they can.Im still happy that I can use 80 years old lens on leica M so I can imagine that after 200 years somebody will be happy to use 300 years old lens on some future digital M mount camera.

 

[benlees]

I buy used digital! Hell, I buy most things used except for food (and other fuels) and various toiletries 🙂. Quite good deals out there though I concede buying used digital is not in the same league as what you can get used, in terms of value, as used film cameras.

 

[larmarv916]

What made European products so collectable is they were built like tanks. Japan built it's cameras out of cheap things like "pot metal" with some hardening treatments. It was like that with motorcycles until a few years ago when Japan industry make a major turnaround and most of the proof that quality was what made loyal customer was the camera companies like Nikon. Go back and take a look at when Lexus, Acura and Infinity brands seemed to appear for no reason. That being said......

Lets look at Digital cameras... for the most part they all started out as cheap plastic junk.

But look at how they went up market and who was at the front of pack for that marketing juggernaut...Nikon & Canon. Digital cameras are by the nature of eletronic parts that make them. already outdated before they hit the market......The Japanese motorcycle companies did this in the early 80's and still are pushing the reality that what you by today is yesterday's out of date junk.

So now digital cameras are made with very high qulity metals , coatings and so on. But used Digital cameras in many cases nothing more than oddities. If Leica is going to try and fool it's customers into thinking that a out of date M8 is going to last and be a excellent as a M3, or any other M body......then they are Fools. Look at your outdated Digital Nikon or Canon that iw only a couple of years old....Can you still get parts for that 10yr old digital camera....No way !

It's like thinking you can get parts for your 1986 Sony.....non digital TV. The electronic industry makes it's future on the fact that nothing is enduring.

Best Regards.....Laurance

 

[Roger Hicks]

But very few people (relatively) have any interest in using 60 year old Leicas. Time marches on.

Compared to the supply of 60-year-old Leicas, though, it's still quite a few. Otherwise they'd be giving 60-year-old Leicas away. This seldom happens.

It's easy to fall into the 'obsolete technology' trap. Vastly increased numbers of people, with lots more money, mean that even niche markets can be lucrative.

Cheers,

Roger

 

[BillP]

I really don't care if I can get parts for a 10 year old digital camera. I don't want to use a 10 year old digital camera anyway. You can get 60 year old Leicas repaired. But very few people (relatively) have any interest in using 60 year old Leicas. Time marches on.

Fair point, but I must say that I am happier using my 80 year old Leica than my 60 year old one...

Regards.

Bill

 

[Olsen]

People think they can run Leica better than Leica's management because we in the USA see a LOT of poorly managed companies that everyone knows are mismanaged, yet the companies' managers keep screwing them up. That may be less common in Europe, but here in the USA, corporate managers are raping their companies to squeeze every bit of short term profit from them as fast as possible and if the company dies in the process...well who cares, the executives got rich and can walk away rich leaving customers, employees, stockholders, and the communities the companies operated in to deal with the mess.

This is very well put. Going public with a company could well spell the end of it. Over here, they try to change the law so that the shareholders directly vote on management compensation, not just the board. Still, going public makes the company vulnerable to greenmailing.

The childless Victor Hasselblad - he was Sweden's richest man at one point, tried to organize the ownership of his company so that it would be owned by a trust (stiftung) after his death. The inspiration must have been the ownership model of Carl Zeiss, - still one of the most profitable companies in the photo business. But some shrewed lawyer screwed him. The final ownership model was not legally watertight. Further: The Hasselblad foundation - the trust that was supposed to sit with the key to the company ownership had a corrupt leadership. And the company was plundered. Large sums was hassled away from the Hasselblad Foundation too.

The culprits are still at large in Sweden, - they all have amassed large fortunes or possess important positions in the Swedish financial world. No individual had been a victim. Just a trust. There never was a proper police investigation, even. Just a few honest journalists cried out. At the time, Swedish police - and mass media, became all preoccupied with the assassination of prime minister Olof Palme. Still unsolved, by the way.

- If you are looking for justice, do not look to Europe....

 

[Matt(1pt4)]

'pleasing this dwindling base of true believers'

All three improvements you mention would be worthwhile, but I think the group of photographers dwindling the fastest is the professional. Why should their needs take primacy over the far more numerous amateurs for whom enjoyment of photography is far more important than results?