Your designer sunglasses just cost you $30,000…oh, and they are all made by Luxottica
I think most people understand that when you buy designer sunglasses you are paying a premium, but an article in the Wall Street Journal last week outlined just how bad it was. For one thing, almost all of the brands you can think of are owned and manufactured by one company, Luxottica.
Do you prefer the “quality” of Ray-Ban to Oakley? Do you think Bulgari is better than Dolce & Gabbana, or Salvatore Ferragamo is better than Prada? Wake up. They’re all made by one company, Italian manufacturer Luxottica–one of the biggest consumer companies that consumers have never heard of. Luxottica also makes sunglasses branded Burberry, Chanel, Polo Ralph Lauren, Paul Smith, Stella McCartney, Tiffany, Versace, Vogue, Persol, Miu Miu, Tory Burch and Donna Karan.
And it gets worse, LensCrafters, Pearle Vision and Sunglass Hut are all owned by the same company. Yep. Luxottica.
This is extreme vertical integration. The eye doctor telling you that you need a new pair of glasses, the sales people helping you choose them and the people who design and make the glasses all work for the same company. Make of it what you will. But if your financial advisor was actually employed by the mutual fund company that he recommended for your portfolio, you’d at least want to know.
And as you guessed, the markups are huge. Luxottica “makes a gross profit of 64 cents on each dollar of sales. Even after deducting sales and advertising costs, overhead and brand licensing royalties it’s still making 52 cents.”
The biggest deal for me, even over the price, is that the more expensive brands do nothing that cheaper $30 and $40 glasses do to protect your eyes from ultra-violet light and white light from the sun.
It typical Wall Street Journal style, they finish with this little tidbit:
Over a lifetime these things add up. Indeed they compound. Even at, say, 4% interest, $200 a year over 50 years adds up to $30,000.
And you know what? $30,000 is just too much money to spend on a pair of sunglasses that I am going to lose tomorrow anyway.
P.S. – I bought a nice $30 pair of sunglasses from Costco with full polarization and 100% UV protection and they actually look pretty cool, with my 1994 coolness sensibilities.
P.S.S. – And if mine ever break, even five years from now, if I chose to do so I can take them back to Costco for a full refund. How’s that for a good customer service?
P.S.S. – My wife works for Costco here in St. Louis, AND WE LOVE IT!!!
Related articles by Zemanta
- Are Designer Sunglasses Worth the Price? (online.wsj.com)
- Who Actually Made All Those Brand Name Sunglasses? (neatorama.com)
Related posts:
- For my palette, India Pale Ale reigns supreme (and Costco’s Kirkland brand beer is lovely) Image via Wikipedia I am not a beer connoisseur by...
- Putting the massive size of a 65,000 light-year bubble at the center of our galaxy in to context The Earth is 25,000 miles around at the equator. Light...
- Coincidentally, Consumer Reports beer tasters agree, Costco beer is “party-worthy”.. Wouldn’t you know it, an hour after I posted my...
