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mostlysignssomeportents:
If you wear glasses, you might have noticed that they’ve been getting
steadily more expensive in recent years, no matter which brand you buy
and no matter where you shop.
That’s because a giant-but-obscure company called Luxottica bought out
Sunglass Hut and Lenscrafters, then used their dominance over the retail
side of glasses to force virtually every eyewear brand to sell to them
(Luxxotica owns or licenses Armani, Brooks Brothers, Burberry, Chanel,
Coach, DKNY, Dolce & Gabbana, Michael Kors, Oakley, Oliver Peoples,
Persol, Polo Ralph Lauren, Ray-Ban, Tiffany, Valentino, Vogue and
Versace); and used that to buy out all the other eyewear retailers of
any note (Luxottica owns Pearle Vision, Sears Optical, Sunglass Hut and
Target Optical) and then also bought out insurers like Eyemed Vision
Care and Essilor, the leading prescription lens/contact lens
manufacturer.
Controlling the labs, insurers, frame makers, and all the major retail
outlets has allowed Luxottica to squeeze suppliers – frames are cheaper
than ever to make, thanks to monopsony buying power with Prada-grade
designer frames costing $15 to manufacture – while raising prices as
much as 1000% relative to pre-acquisition pricing.
It’s even worse for lenses: a pair of prescription lenses that cost $1.50 to make sell for $800 in the USA.
LA Times columnist David Lazarus wrote a column about skyrocketing eyewear prices
and was approached by Charles Dahan, who once owned one of the largest
frames companies in America, Custom Optical, which supplied 20% of the
frames sold at Lenscrafters prior to the Luxottica acquisition. Dahan
describes how Luxottica cornered the horizontal and vertical markets for
eyewear and pushed out or bought out every other company (Oakley
refused to sell or lower prices, so Luxottica boycotted it from its
retailers, forcing the company into such a precarious position that it
Luxottica was able to buy it for a fraction of its peak book-value just a
few years later).
This is a good example of how decades of far-right ideologically driven antitrust malpractice
has hurt everyone. After all, glasses aren’t just a fashion item:
they’re a necessity for people with poor vision, a prerequisite for
driving, walking, cycling, reading, getting an education or doing your
job.
Luxottica grew through acquisition, by buying up its competition. This was banned under classic antitrust law,
until the Reagan years. This pattern has been repeated in many other
domains: beer, whiskey, retail pharmacies, and so on. In every one of
those domains, we are getting screwed, as are small businesspeople and
the families they serve.
https://boingboing.net/2019/03/12/luxottica.html
(Your picture was not posted)
mostlysignssomeportents:
If you wear glasses, you might have noticed that they’ve been getting
steadily more expensive in recent years, no matter which brand you buy
and no matter where you shop.
That’s because a giant-but-obscure company called Luxottica bought out
Sunglass Hut and Lenscrafters, then used their dominance over the retail
side of glasses to force virtually every eyewear brand to sell to them
(Luxxotica owns or licenses Armani, Brooks Brothers, Burberry, Chanel,
Coach, DKNY, Dolce & Gabbana, Michael Kors, Oakley, Oliver Peoples,
Persol, Polo Ralph Lauren, Ray-Ban, Tiffany, Valentino, Vogue and
Versace); and used that to buy out all the other eyewear retailers of
any note (Luxottica owns Pearle Vision, Sears Optical, Sunglass Hut and
Target Optical) and then also bought out insurers like Eyemed Vision
Care and Essilor, the leading prescription lens/contact lens
manufacturer.
Controlling the labs, insurers, frame makers, and all the major retail
outlets has allowed Luxottica to squeeze suppliers – frames are cheaper
than ever to make, thanks to monopsony buying power with Prada-grade
designer frames costing $15 to manufacture – while raising prices as
much as 1000% relative to pre-acquisition pricing.
It’s even worse for lenses: a pair of prescription lenses that cost $1.50 to make sell for $800 in the USA.
LA Times columnist David Lazarus wrote a column about skyrocketing eyewear prices
and was approached by Charles Dahan, who once owned one of the largest
frames companies in America, Custom Optical, which supplied 20% of the
frames sold at Lenscrafters prior to the Luxottica acquisition. Dahan
describes how Luxottica cornered the horizontal and vertical markets for
eyewear and pushed out or bought out every other company (Oakley
refused to sell or lower prices, so Luxottica boycotted it from its
retailers, forcing the company into such a precarious position that it
Luxottica was able to buy it for a fraction of its peak book-value just a
few years later).
This is a good example of how decades of far-right ideologically driven antitrust malpractice
has hurt everyone. After all, glasses aren’t just a fashion item:
they’re a necessity for people with poor vision, a prerequisite for
driving, walking, cycling, reading, getting an education or doing your
job.
Luxottica grew through acquisition, by buying up its competition. This was banned under classic antitrust law,
until the Reagan years. This pattern has been repeated in many other
domains: beer, whiskey, retail pharmacies, and so on. In every one of
those domains, we are getting screwed, as are small businesspeople and
the families they serve.
https://boingboing.net/2019/03/12/luxottica.html
(Your picture was not posted)
