I will create a very general example that represents how this works. A Breitling
watch coming out of the factory costs low price to produce in terms of parts and
labor. The manufacture wishes to make some profit on the breitling
navitimer replica
watch so the price to the distributor is low
price. The distributor is in charge of getting the Breitling watch to retailers.
But first the distributor needs to get the Breitling watches out of the country,
and into other countries.
This gets import and export taxes and duties
involved - which vary greatly on the placed involved. They are often based on
the value of the Breitling watches. In addition to paying these customs, the
distributor also needs to take a cut for profit. The distributor also has to
find retailers (and hires sales people). To cover all these expenses and make a
profit, the distributor charges the retailer low price for the Breitling watch.
The retailer is then charged with getting customers in the store, and must hire
and pay sales people (who are often on a percentage commission + base pay
revenue model). Marketing costs are often (ideally) distributed between brand,
distributor, and retailer. In order to cover these costs, plus the commission
for the replica Rolex Day
Date
person in the store and get a profit, the retailer needs to
charge low price for the Breitling watch. You can now see how a Breitling watch
that cost low price in a store.
It is for this very reason that selling
online - direct to the consumer - is so very attractive for brands. They have
been able to maintain a pricing scheme for years, and can charge the exact same
price to the consumer and get a lot more profit. Plus, the experience for the
consumer is virtually the same, and they can potentially buy a Breitling watch
more conveniently.
Few people are experts when it comes to the pricing
and valuation of timepieces. This applies to many industries. The allure of
luxury, performance, and presumed quality can mask what are modest underpinnings
with pretty clothing. The bottom line is that many Breitling timepieces aren't
that expensive to produce. They can charge a lot and not look horrendously silly
because there does exists a substantial contingent of timepieces that are very
expensive to produce. Believe me, there are timepieces that cost as much as a
top of the line replica Rolex Sea
Dweller
and represent a "good value" given the costs to make them.
Given the existence of these very cost intensive to produce Breitling watches,
others attempt to bootstrap themselves to such quality players. This is despite
the fact that they cost a small fraction of their retail price to produce.