Black Jack wrote:Mr. E wrote:Black Jack wrote:Not sure if you noticed but huge high-cost established industries are being torn apart by scrappy startups left and right these days. If you ask me Lavar might have the right idea.
Please provide examples.
(I hope that you aren't using Uber/Lyft as one...that would be so off base)
Any example where a startup could be challenging an established market should involve an upgrade in technology, a streamlined cost model or a specific and definable societal shift that would predicate such a market move.
LaVar has a new supplier, that's the same thing. Could LaVar Jordan or LaVar Johnson have called up a chinese factory and had a (seemingly) high quality Nike competitor product for the price LaVar has done it 30 years ago? Could he have promoted and sold it for free using people like us to repeat his name and link to his website?
Who is the new supplier? What you are discussing there is a factor of production and basically it is one on par with getting cheap, generic knock-offs of quality products. I could go down to Harwin Drive in Houston and get all manner of cheap imported knock-offs, but I wouldn't suggest it as a business model.
Doing business in China is not as cheap or easy as many seem to think. Nor does paying a low cost for production put you in the Nike camp. Nike may pay very little per shoe, but that is with quality materials with high production runs. I'm not seeing how going to someone in China who claims to be able to provide cheap shoes will translate to a quality product.
You are not really describing a disruptive force in the shoe industry. Cheap knock-offs always exist and it does not make for a competitive alternative. It does not address any of the other issues involved in this situation such as shipping, taxes, tariffs, salaries, marketing, logistics, legal, accounting, etc.
It almost seems as if the high end for this BBB model is to be a high-priced, niche market. There can be a lot of money in that if the product is good. It does not appear that quality is going to be a selling point, so this would be name-only. Is that really sustainable?