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areyoumydude


Apr 1, 2010, 6:19 PM
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They're here....

http://climbxgear.com/rockshoes-2.aspx


nkane


Apr 1, 2010, 6:30 PM
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Shhhhh.... listen...






Hear that?

It's the sound of a thundering herd of patent lawyers.


areyoumydude


Apr 1, 2010, 6:33 PM
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nkane wrote:
Shhhhh.... listen...






Hear that?

It's the sound of a thundering herd of patent lawyers.


What patents?


adatesman


Apr 1, 2010, 6:34 PM
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cleethree


Apr 1, 2010, 6:48 PM
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if they copied some good shoes i would think about maybe buying a pair for the gym.


areyoumydude


Apr 1, 2010, 6:53 PM
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cleethree wrote:
if they copied some good shoes i would think about maybe buying a pair for the gym.

They are not a copy, they just have a new name.


cleethree


Apr 1, 2010, 6:56 PM
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really? why is everything 10 bucks cheaper?


areyoumydude


Apr 1, 2010, 7:01 PM
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cleethree wrote:
really? why is everything 10 bucks cheaper?

Looks like the original pricing to me. 69.95 for the flashes err redpoints.

They are the exact same shoe.


shockabuku


Apr 1, 2010, 7:02 PM
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Their web site is a little too busy for pleasant viewing.


adatesman


Apr 1, 2010, 7:23 PM
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johnwesely


Apr 1, 2010, 7:27 PM
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shockabuku wrote:
Their web site is a little too busy for pleasant viewing.

That is the understatement of the century.


buck0land


Apr 1, 2010, 8:25 PM
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http://www.rockclimbing.com/...rum.cgi?post=2283848


mojomonkey


Apr 1, 2010, 8:29 PM
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buck0land wrote:
http://www.rockclimbing.com/...rum.cgi?post=2283848

heh... I think you meant: http://www.rockclimbing.com/...rum.cgi?post=2283848


acorneau


Apr 1, 2010, 8:56 PM
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From the "About Us" page:

In reply to:
SO WHILE THE NAME MAY BE NEW, OUR MISSION HAS REMAINED THE SAME: TO GIVE YOU THE BEST PERFORMANCE AND CUTTING-EDGE DESIGNS AT THE BEST PRICE, WITH THE BEST SERVICE.

Now Under New Old Management. Welcome friends and fans the first Climb X website—as you will quickly notice, the company name may be new, but the products inside these pages are longtime favorites. While we’d much rather discuss our latest designs and leave the boring office talk behind, the short story is the original owners and management have decided to take a more prominent role in the direction, product mix and strategy of this business. With this change, a new name has been chosen to set us apart and differentiate this company from the previous one: we are now Climb X. Same sales team. Same distributors. Same production facility. Same product development staff. The same award-winning products.

In this catalog, you will find many of the same products as before (renamed, and with the usual running upgrades and color changes) as well as some fresh all-new offerings. For 2010, Climb X will have new warehouses and offices staffed with the best in the business and dedicated to quick delivery turnarounds and knowledgeable customer service. So while the name may be new, our mission has remained the same: to give you the best performance and cutting-edge designs at the best price with the best service.

Our future plans are both ambitious and attainable: for next season, Climb X will truly hit its stride and show what this company is capable of: a host of new products, improvements to existing products, stringent ISO 9000 quality certification, more efficient logistics to our partners and much, much more. The future is very bright indeed for this new, old company.

Sincerely,
Joe Garland President, Climb X


Partner gamehendge


Apr 1, 2010, 9:13 PM
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acorneau wrote:
From the "About Us" page:

In reply to:
SO WHILE THE NAME MAY BE NEW, OUR MISSION HAS REMAINED THE SAME: TO GIVE YOU THE BEST PERFORMANCE AND CUTTING-EDGE DESIGNS AT THE BEST PRICE, WITH THE BEST SERVICE.

Now Under New Old Management. Welcome friends and fans the first Climb X website—as you will quickly notice, the company name may be new, but the products inside these pages are longtime favorites. While we’d much rather discuss our latest designs and leave the boring office talk behind, the short story is the original owners and management have decided to take a more prominent role in the direction, product mix and strategy of this business. With this change, a new name has been chosen to set us apart and differentiate this company from the previous one: we are now Climb X. Same sales team. Same distributors. Same production facility. Same product development staff. The same award-winning products.

In this catalog, you will find many of the same products as before (renamed, and with the usual running upgrades and color changes) as well as some fresh all-new offerings. For 2010, Climb X will have new warehouses and offices staffed with the best in the business and dedicated to quick delivery turnarounds and knowledgeable customer service. So while the name may be new, our mission has remained the same: to give you the best performance and cutting-edge designs at the best price with the best service.

Our future plans are both ambitious and attainable: for next season, Climb X will truly hit its stride and show what this company is capable of: a host of new products, improvements to existing products, stringent ISO 9000 quality certification, more efficient logistics to our partners and much, much more. The future is very bright indeed for this new, old company.

Sincerely,
Joe Garland President, Climb X

Here's an article that should shed some light on this...

When Joe Garland responded to a SNEWS® inquiry seeking more details behind his announced Jan. 11 departure from Mad Rock, he said, by email, “I will have a very good answer to everyone’s questions (not just yours) in two weeks. Thanks for contacting me. Sorry to be so cryptic. The reply is worth waiting for.” (Click here to read our Jan. 13, 2010, story, “Garland exits Mad Rock citing internal differences.”)

Although it took a bit more than two weeks, Garland revealed on Feb. 5 via a news release to the climbing media and, we were told, retailers, distributors and other select recipients, that he was launching a new climbing company called Climb X.

While the news itself was not so earthshaking, the manner in which it was presented certainly left more than a few industry readers confused. Based on the release, it appeared Climb X was taking over Mad Rock’s business operations. Naturally, the blogosphere, email churn and more began to go into overdrive, simply passing along the news and sometimes adding to it with potential misperceptions.

In an attempt to sort out the kernels of truth amid the possible hyperbole, rumor and speculation bantered about, SNEWS launched an investigation, including on the ground at Germany’s ispo show going on this week, as well as by phone, email and even fax (old school, we know). Here is what we uncovered:

It is an undisputed fact that Garland has launched a new climbing company with global distribution aspirations called Climb X. It is registered in Canada as Climb-X Sports Inc., and the company has two trademarks approved for ClimbX recently registered in both Canada and the United States. Plus, it was exhibiting at the ispo show in the Everest booth -- the same booth as Mad Rock.

Additionally, neither Garland nor the new Climb X company have any rights to anything owned by Mad Rock, including materials, designs, trademarks, patents, product, etc. Mad Rock’s parent company is Nelson Sports, a California-registered corporation owned by Young Chu.

As for the information in the release -- sent by the PR company Subrosa Group of Nurnberg, Germany, on behalf of Garland -- it contains numerous errors or statements that can easily be miscontrued according to our research.

>> The official Climb X news release began by stating: “Joseph Garland, a founding member of Mad Rock Climbing since its inception in 2002 who announced his departure from the company in early January has returned to the industry, and is now working for Mad Rock’s parent company and manufacturer.”

However, that is not exactly true. Garland has never been an employee of Mad Rock, according to Chu. Even Garland acknowledged Nelson Sports owns Mad Rock in a Feb. 5 email to SNEWS where he stated, “The brand name Mad Rock has been and as far as I know owned by Young Chu and Nelson Sports.” So, Garland is not working for Mad Rock’s parent company at all.

And, while Garland may have been brought in as a contractor to oversee sales and marketing of the new Mad Rock brand around the time of its launch in 2002, calling himself a founding member does appear to be stretching the limits of the definition.

>> The news release continued: “Three of Mad Rock’s original partners: Alex Kim, Ken Kim and Joe Garland will continue the business under the new name ‘Climb X,’ with Joe Garland being named its new President. Original Mad Rock President and partner Young Chu will retain the Mad Rock name, but is no longer a member of this group.”

While Chu acknowledged to SNEWS in a phone interview that Alex Kim was, in fact, made a minority partner of the factory that Mad Rock set up in China, he was not and never has been a partner in the Mad Rock business or the Nelson Sports business. Though Chu did not know who Ken Kim was, Garland confirmed to SNEWS by email that he was Alex Kim’s brother.

It is also important to point out that neither Garland nor the Kim brothers are continuing any business of Mad Rock. They are, as Chu has detailed to us, simply launching a new company: Climb X. And, of course, Chu is retaining the Mad Rock name -- since he owns the company.

>> According to the Climb X news release: “Climb X will assume the former Mad Rock operation, its distributors, most of its sales reps, international staff, warehouse, factory & production, and product development facility, as well as its Chinese and international warehouse facilities.”

In truth, Climb X is not assuming the former Mad Rock operations. Put simply, it is now manufacturing in the same factory in China that Mad Rock has used, Tianjin Hardstone Outdoor Co. Further, according to Chu, Mad Rock has already exited that facility in favor of a new factory that Chu had been setting up in Vietnam. Chu told us that the company was waiting to announce the new factory until it was fully operational, but the news from Garland forced him to go public sooner. The factory is already producing chalk bags, crash pads and other softgoods, Chu told us, and will soon be producing climbing shoes and other Mad Rock gear. International warehousing has already been moved as well.

In a Feb. 5 news release posted to its website, Mad Rock (www.madrockclimbing.com) officially announced the new factory for the first time: “Mad Rock Climbing is happy to announce that the move from China to Vietnam was a success. Even though the transition was difficult, it was a necessary move in the face of overwhelming price increases in China. We will be able to pass on savings to the dealers and consumers while maintaining quality and innovation, which has been the cornerstone of Mad Rock’s philosophy.”

Any statement about distributors and reps in the Climb X news release appears a bit premature. Of the five U.S. sales reps currently working for Mad Rock, three told SNEWS directly in interviews that they were continuing as Mad Rock sales reps. In addition -- other than Everest, a German distributor with whom Garland apparently has a relationship -- Kenny Suh, international sales and marketing manager for Mad Rock, told us by phone and email from ispo, as well as in personal conversations at the German show, that a majority of the international distributors currently working with Mad Rock will continue to work with it.

Garland disputed that assertion -- so at this point, and since SNEWS has not personally spoken with a majority of the existing international distributors, the issue of which distributors are siding with which camp (Climb X or Mad Rock) remains unclear. However, it is worth noting what one international business expert familiar with all the players and many key retailers currently selling Mad Rock told SNEWS: “Even if a distributor is a big fan of Garland, shifting gears to jump on with a brand that consumers have no knowledge of or experience with in any market, especially in an economy that is still challenged in most countries, would be extremely risky. Mad Rock is a known entity and one that is trusted by retailers and consumers. Climb X, no matter how good it promises to be, is just a new brand with no sales or production track record. However, if Mad Rock stumbles for any reason in this next year, in deliveries or quality control from its new factory in Vietnam, the scenario could shift in favor of Climb X. Only time will tell on this issue.”

>> The Climb X news release also stated: “Garland, who was responsible for most of the newer products developed at Mad Rock, will be working out of offices in Portland, Oregon, with satellite offices in Munich, Germany and Beijing, China.”

Both Chu and Suh told SNEWS that the claim by Garland that he was responsible for many of Mad Rock’s product design and development is simply not true.

In a follow-up email to SNEWS where we asked him to clarify his roles at Mad Rock prior to his departure, Garland said nothing about being involved with design and asserted that he managed worldwide sales and marketing for the company with “the Brothers Alex and Ken on the factory, production and financing side, (and) Young Chu (as) middle man and sometime designer.”

Whether or not Garland was involved in any aspect of design or production, this much is fact: Following an extensive search of the U.S. Patent and Trademark Office website for any known or pending patents for Mad Rock or, in fact, for any other climbing product design for any other company, Garland’s name does not appear. On the other hand, Chu holds four U.S. patents as an inventor. The first, for a climbing shoe with a concave sole for which the patent was applied on April 23, 2001 -- before Garland ever joined the company and before Mad Rock was even formed. Another patent for a safety buckle, filed on April 24, 2004, was granted Sept. 19, 2006, and another for a climbing shoe heel design was granted on March 14, 2006.

>> The release from Climb X also stated: “Climb X stock will be available in early March for dealers and distributors from a relocated distribution center in Las Vegas, Nevada. The logistics of relocating the offices and DC are geared for quicker access to the merchandise for North American dealers, and paves the way for a deeper pool of qualified candidates for office staff. The Las Vegas DC has the benefit of being one shipping day closer to eastern customers, while giving identical ship times to all western accounts as Mad Rock’s Orange County distribution center.”

In truth, the offices and distribution center are not being relocated, as Garland asserted. He is opening new offices and a distribution center in Las Vegas, as a result of supporting his new company launch -- which has nothing to do with Mad Rock.

As for quicker shipping times, a call to FedEx confirmed there really is no advantage as both Orange County, California, and Las Vegas serve all parts of the country equally well and within the same timetable, east or west.
--Michael Hodgson
SNEWS


moose_droppings


Apr 1, 2010, 11:01 PM
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What a soap opera!
CrazyUnsureShocked


bill413


Apr 2, 2010, 1:48 AM
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moose_droppings wrote:
What a soap opera!
CrazyUnsureShocked

So I'll be able to see the short version in the supermarket checkout lines?


climbingtrash


Apr 2, 2010, 2:48 AM
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What!? Mad Kitty iz gone?!?


moose_droppings


Apr 2, 2010, 4:20 AM
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Doesn't appear to be a short version.

Maybe soon they'll have it in Cliff notes.Laugh


squierbypetzl
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Apr 2, 2010, 9:48 AM
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Does seem like a lawsuit is around the corner. Patent violations, stealing trade secrets, copying industrial designs... Hope Garland knows what he´s doing.


USnavy


Apr 2, 2010, 10:02 AM
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Let me see if I got it right. Some Mad Rock employee quits their job, takes all Mad Rock’s classified company secrets with them, opens "Climb X", completely copies all of Mad Rock's patented products, and then tries to sell the stuff off as their own? What a great idea... The only thing Joe has does is set the record for the largest scam in the entire history of the climbing equipment industry. Sounds like an eight figure lawsuit is in order soon.


(This post was edited by USnavy on Apr 2, 2010, 10:13 AM)


adatesman


Apr 2, 2010, 1:36 PM
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johnwesely


Apr 2, 2010, 2:44 PM
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adatesman wrote:
USnavy wrote:
Let me see if I got it right. Some Mad Rock employee contractor quits their job, takes all Mad Rock’s classified company secrets with them, opens "Climb X", completely copies all of Mad Rock's patented products, and then tries to sell the stuff off as their own? What a great idea... The only thing Joe has does is set the record for the largest scam in the entire history of the climbing equipment industry. Sounds like an eight figure lawsuit is in order soon.

(Not so) minor point- he apparently was not an employee, but rather a contracted sales rep.

Geez.... I've seen salesmen walk out with customer lists, but this takes the cake!

It is even worse than walking out with the Glengarry leads.


scottek67


Apr 2, 2010, 3:20 PM
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areyoumydude wrote:
They're here....

http://climbxgear.com/rockshoes-2.aspx

awesome! I just hope my order gets shipped before the lawyers show up! Tongue


Partner cracklover


Apr 2, 2010, 3:35 PM
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adatesman wrote:
USnavy wrote:
Let me see if I got it right. Some Mad Rock employee contractor quits their job, takes all Mad Rock’s classified company secrets with them, opens "Climb X", completely copies all of Mad Rock's patented products, and then tries to sell the stuff off as their own? What a great idea... The only thing Joe has does is set the record for the largest scam in the entire history of the climbing equipment industry. Sounds like an eight figure lawsuit is in order soon.

(Not so) minor point- he apparently was not an employee, but rather a contracted sales rep.

Geez.... I've seen salesmen walk out with customer lists, but this takes the cake!

There are two other very key bits left out:

1 - This is more or less exactly how Mad Rock was started in the first place. The guy who started it was an employee at Five Ten who set up shop in China to make cheap knockoffs.

2 - The current episode in the soap opera is taking place in China, where Joe apparently took over the shoe factory, while the Mad Rock people set up a new one in, Vietnam, I think? Anyway, the point is that China is not exactly known for patent enforcement, to say the least.

My favorite of the new names for ClimbX shoes is a slipper called the "Rad Moc". Get it? Rad Moc!

Hahahahaha!

GO


pfwein


Apr 2, 2010, 4:22 PM
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cracklover wrote:
. . . Anyway, the point is that China is not exactly known for patent enforcement, to say the least. . . .

GO

China may not be known for patent enforcement, but that's beside the point unless you're somehow interested in shoes being sold in China for use in China.
Assuming we're talking about shoes imported into the US, US patent law provides a remedy (see relevant part of US Patent Act pasted below).

I have no idea whether ClimbX has infringed Mad Rock's patents or otherwise violated any of its intellectual property rights; the mere fact that its shoes look the same isn't really enough information to have a view one way or the other. (But if the shoes really are the same, the only was I can see ClimbX avoiding patent infringement is if MadRock's patents don't cover its own shoes, which is theoretically possible.)


35 U.S.C. 271 Infringement of patent.

(a) Except as otherwise provided in this title, whoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States, or imports into the United States any patented invention during the term of the patent therefor, infringes the patent.


trogdortheburninator1


Apr 2, 2010, 4:25 PM
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cracklover wrote:

My favorite of the new names for ClimbX shoes is a slipper called the "Rad Moc". Get it? Rad Moc!

Hahahahaha!

GO

lol, they finally put my name suggestion to use:

http://www.rockclimbing.com/...t_reply;so=ASC;mh=25


USnavy


Apr 2, 2010, 4:53 PM
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pfwein wrote:
cracklover wrote:
. . . Anyway, the point is that China is not exactly known for patent enforcement, to say the least. . . .

GO


I have no idea whether ClimbX has infringed Mad Rock's patents or otherwise violated any of its intellectual property rights; the mere fact that its shoes look the same isn't really enough information to have a view one way or the other.
Clearly Climb X came up with those completely identical designs all on their own.


pfwein


Apr 2, 2010, 5:40 PM
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USnavy wrote:
pfwein wrote:
cracklover wrote:
. . . Anyway, the point is that China is not exactly known for patent enforcement, to say the least. . . .

GO


I have no idea whether ClimbX has infringed Mad Rock's patents or otherwise violated any of its intellectual property rights; the mere fact that its shoes look the same isn't really enough information to have a view one way or the other.
Clearly Climb X came up with those completely identical designs all on their own.

US Navy--
I can see from your post that I didn't make my point clearly. Let me try again because I want to correct a misunderstanding that many people seem to have.

In general, a company is free to copy a competitor's products. It does not matter that it is a complete knock off. Of course there are many exceptions:

You cannot (legally) infringe another company's patents. But patents don't usually protect things like rockclimbing shoes (there exceptions to that, and I believe there were references to patents in this thread. One would have to read the relevant patents and see what inventions they cover, and compare the patents to ClimbX's shoes. Until that is done, it is premature to suggest that the ClimbX is or is not infringing Mad Rock's patents).

You also cannot (legally) copy a company's trademarks. So I could make a shoe that is identical to a Nike shoe EXCEPT I cannot include the swoosh or something confusingly similar to the swoosh. Here, the name ClimbX is of course in no way similar to Mad Rock.

There are exceptions to every rule of course and I've also seen allegations made of theft of trade secrets (without any suggestion as to what those trade secrets were).

My main point, and what I think many people fail to understand, it that it is generally OK to make knock off products. That's one reason why patents can be so important--they are in general the only way to stop other companies from making functionally equivalent knock offs of any products.

There is probably a valuable lesson to business owners to carefully consider what steps they can take to protect their intellectual property and also what agreements they should have with their employees and contractors in the nature of non-competes and such (which can be a complicated area of the law and the rules vary significantly across jurisdictions).


jt512


Apr 2, 2010, 5:49 PM
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pfwein wrote:
cracklover wrote:
. . . Anyway, the point is that China is not exactly known for patent enforcement, to say the least. . . .

GO

China may not be known for patent enforcement, but that's beside the point unless you're somehow interested in shoes being sold in China for use in China.
Assuming we're talking about shoes imported into the US, US patent law provides a remedy (see relevant part of US Patent Act pasted below).

I was wondering about that. What about Europe? Do they honor US patent claims? If so, then could Climb X be left with essentially no Western markets?

In reply to:
But if the shoes really are the same, the only was I can see ClimbX avoiding patent infringement is if MadRock's patents don't cover its own shoes, which is theoretically possible.

More than just theory. I have heard, for instance, that Five Ten has not patented its rubber because it doesn't want to disclose its formula.

So your theory is supported by a rumored anecdote.

Jay


(This post was edited by jt512 on Apr 2, 2010, 5:50 PM)


jt512


Apr 2, 2010, 5:55 PM
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gamehendge wrote:

Here's an article that should shed some light on this...

[snip]

Thanks for digging that up. It seems to be well written and is the first thing I've read about this new company that makes any sense.

If it is true that Mad Rock will have lower production costs in Vietnam than Climb X has in China, then Climb X might have trouble competing. My money is on Mad Rock.

Edit: Does anyone else think it strange that we have heard little, if any, public comment about this from Mad Rock?

Jay


(This post was edited by jt512 on Apr 2, 2010, 5:58 PM)


photoguy190


Apr 2, 2010, 6:14 PM
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For somethings its better to not patten, say the KFC secret recipe cause patents only last so long then you exposed it and its up for grabs. So if you feel like you can hide a formula go for it. But when all you have to do is look at it, say alien cams and know how to do it you have to patent. I think if Mad Rock holds any patents on the shoes Climbx will have trouble selling in the US at least with front channels, there is always ebay and maybe direct sales.


rubber_man


Apr 2, 2010, 6:27 PM
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jt512 wrote:
gamehendge wrote:

Here's an article that should shed some light on this...

[snip]

Thanks for digging that up. It seems to be well written and is the first thing I've read about this new company that makes any sense.

If it is true that Mad Rock will have lower production costs in Vietnam than Climb X has in China, then Climb X might have trouble competing. My money is on Mad Rock.

Edit: Does anyone else think it strange that we have heard little, if any, public comment about this from Mad Rock?

Jay

I have been searching/waiting for a comment from them, I wish they would, kinda want to know if they're planning on doing/attempting to do anything about what's going on with climbx.

and my money is on madrock too.


jt512


Apr 2, 2010, 6:27 PM
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photoguy190 wrote:
For somethings its better to not patten, say the KFC secret recipe cause patents only last so long then you exposed it and its up for grabs. So if you feel like you can hide a formula go for it. But when all you have to do is look at it, say alien cams and know how to do it you have to patent. I think if Mad Rock holds any patents on the shoes Climbx will have trouble selling in the US at least with front channels, there is always ebay and maybe direct sales.

Thanks for repeating my point for the rc.com audience. Clearly, my post was too succinct, grammatical, and well spelled.

Jay


shoo


Apr 2, 2010, 6:32 PM
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jt512 wrote:
I was wondering about that. What about Europe? Do they honor US patent claims? If so, then could Climb X be left with essentially no Western markets?

In general, yes. All World Trade Organization (WTO) member states are required to participate in the WTO's intellectual property regime, called TRIPS (trade-related aspects of intellectual property rights). The rules regarding TRIPS gel very well with the US patent office. Since virtually all "Western" states are WTO member states, they must comply with TRIPS, and in general, US patents.


rubber_man


Apr 2, 2010, 6:33 PM
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jt512 wrote:
photoguy190 wrote:
For somethings its better to not patten, say the KFC secret recipe cause patents only last so long then you exposed it and its up for grabs. So if you feel like you can hide a formula go for it. But when all you have to do is look at it, say alien cams and know how to do it you have to patent. I think if Mad Rock holds any patents on the shoes Climbx will have trouble selling in the US at least with front channels, there is always ebay and maybe direct sales.

Thanks for repeating my point for the rc.com audience. Clearly, my post was too succinct, grammatical, and well spelled.

Jay

You're just to fancy for us normalz folks Pirate


curt


Apr 2, 2010, 6:57 PM
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jt512 wrote:
gamehendge wrote:

Here's an article that should shed some light on this...

[snip]

Thanks for digging that up. It seems to be well written and is the first thing I've read about this new company that makes any sense.

If it is true that Mad Rock will have lower production costs in Vietnam than Climb X has in China, then Climb X might have trouble competing. My money is on Mad Rock.

Edit: Does anyone else think it strange that we have heard little, if any, public comment about this from Mad Rock?

Jay

I notice that this is on the Mad Rock website:

MadRock wrote:
PRESS RELEASE

FOR IMMEDIATE RELEASE

Customer Alert!

Santa Fe Springs, CA February 15, 2010:

Mad Rock Climbing is issuing a customer alert for Climb X products. Climb X products are an imitation made with the intention to deceive the consumer into believing it to be genuine Mad Rock products. Mad Rock and its parent company Nelson Sports Inc. has no affiliation with Climb X or its products, which violates numerous patent and copyright laws. We encourage any customers who have been approached by Climb X to contact us immediately.

Contact:
Kenny Suh Kenny@Madrockclimbing.com
800.959.5792


This could get pretty interesting...

Curt


curt


Apr 2, 2010, 7:03 PM
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cracklover wrote:
There are two other very key bits left out:

1 - This is more or less exactly how Mad Rock was started in the first place. The guy who started it was an employee at Five Ten who set up shop in China to make cheap knockoffs...

As long as we're trying to get an accurate idea of historical events here, it should be pointed out that Young Chu was actually contracted to manufacture 5.10 products in China and did so for a number of years before having a falling out with 5.10--when he then began to produce Mad Rock products in that same factory.

Curt


photoguy190


Apr 2, 2010, 7:07 PM
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curt wrote:
cracklover wrote:
There are two other very key bits left out:

1 - This is more or less exactly how Mad Rock was started in the first place. The guy who started it was an employee at Five Ten who set up shop in China to make cheap knockoffs...

As long as we're trying to get an accurate idea of historical events here, it should be pointed out that Young Chu was actually contracted to manufacture 5.10 products in China and did so for a number of years before having a falling out with 5.10--when he then began to produce Mad Rock products in that same factory.

Curt

At least Young Chu made different shoes, these are the same down to the colors, at least they could have changed the color


adatesman


Apr 2, 2010, 7:13 PM
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Partner cracklover


Apr 2, 2010, 7:16 PM
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curt wrote:
cracklover wrote:
There are two other very key bits left out:

1 - This is more or less exactly how Mad Rock was started in the first place. The guy who started it was an employee at Five Ten who set up shop in China to make cheap knockoffs...

As long as we're trying to get an accurate idea of historical events here, it should be pointed out that Young Chu was actually contracted to manufacture 5.10 products in China and did so for a number of years before having a falling out with 5.10--when he then began to produce Mad Rock products in that same factory.

Curt

Thanks, I knew I wasn't remembering the story perfectly.

GO


squierbypetzl
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Apr 2, 2010, 7:26 PM
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shoo wrote:
jt512 wrote:
I was wondering about that. What about Europe? Do they honor US patent claims? If so, then could Climb X be left with essentially no Western markets?

In general, yes. All World Trade Organization (WTO) member states are required to participate in the WTO's intellectual property regime, called TRIPS (trade-related aspects of intellectual property rights). The rules regarding TRIPS gel very well with the US patent office. Since virtually all "Western" states are WTO member states, they must comply with TRIPS, and in general, US patents.

I´d argue yes but no on this one. One of the principal characteristics of a patent is territoriality, ie it´s only good in the territory of the state granting it. While there have been at least 2 major international efforts aimed at consolidating patent laws, these are not yet plainly enforceable in every state.

To make a US patent enforceable in a foreign country, one must file for a patent in that country.

A loophole opened to address the above (with the treaty of Paris on Patent Cooperation), is granting the patent holder&seeker a period of 12 months to file an International Petition, counted from the legal date of the original patent (the date the patent was petitioned/filed for). What that does is use the International Search Authority to seek out the worldwide state of the art, and then turn over its results to the patent seeker, who then decides in which countries they will file for patent protection. Overall, the patent holder has about 42 months to file for a patent in a PCT cosignatary country.

AFTER the 12 month grace period, if no Intl. petition is filed, the patented invention enters the state of the art, and is thusly no protectable via patent, in say Brazil or Mexico.

If MR did not seek out intl. patent protection for its products in due time, it is tres fuked in other countries, but not in the US market.


shoo


Apr 2, 2010, 7:31 PM
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squierbypetzl wrote:
shoo wrote:
jt512 wrote:
I was wondering about that. What about Europe? Do they honor US patent claims? If so, then could Climb X be left with essentially no Western markets?

In general, yes. All World Trade Organization (WTO) member states are required to participate in the WTO's intellectual property regime, called TRIPS (trade-related aspects of intellectual property rights). The rules regarding TRIPS gel very well with the US patent office. Since virtually all "Western" states are WTO member states, they must comply with TRIPS, and in general, US patents.

I´d argue yes but no on this one. One of the principal characteristics of a patent is territoriality, ie it´s only good in the territory of the state granting it. While there have been at least 2 major international efforts aimed at consolidating patent laws, these are not yet plainly enforceable in every state.

To make a US patent enforceable in a foreign country, one must file for a patent in that country.

A loophole opened to address the above (with the treaty of Paris on Patent Cooperation), is granting the patent holder&seeker a period of 12 months to file an International Petition, counted from the legal date of the original patent (the date the patent was petitioned/filed for). What that does is use the International Search Authority to seek out the worldwide state of the art, and then turn over its results to the patent seeker, who then decides in which countries they will file for patent protection. Overall, the patent holder has about 42 months to file for a patent in a PCT cosignatary country.

AFTER the 12 month grace period, if no Intl. petition is filed, the patented invention enters the state of the art, and is thusly no protectable via patent, in say Brazil or Mexico.

If MR did not seek out intl. patent protection for its products in due time, it is tres fuked in other countries, but not in the US market.

I stand corrected. Thanks!


squierbypetzl
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Apr 2, 2010, 7:38 PM
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adatesman wrote:
jt512 wrote:
More than just theory. I have heard, for instance, that Five Ten has not patented its rubber because it doesn't want to disclose its formula.

So your theory is supported by a rumored anecdote.

Jay

Coca-cola isn't patented for that reason as well... they'd have to disclose the recipe. Not an uncommon practice, from what I can tell.

Trade secrets, as you probably know, are extremely common, and can range (generally speaking as local definitions may on occasion vary) from customer and supplier lists, to industrial processes and formulas.

The big major huge difference between a patent and a trade secret is that a patent grants you total and complete protection against any and all infringement. A trade secret on the other hand, is only good once its kept a secret. If someone arrives at the same conclusion by themselves, there´s absolutely nothing that can be done to stop them.

Dunno if MR has its designs protected as well, since making carbon copies of the shows, color and all, would definitely violate that protection.


squierbypetzl
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Apr 2, 2010, 7:40 PM
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 And if any Mad Rock (TM) people are out there reading, my comprehensive legal services are readily available. Tongue


squierbypetzl
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Apr 2, 2010, 7:42 PM
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 And if any ClimbX (TM) people are out there reading, my comprehensive legal services are readily available. Tongue


USnavy


Apr 3, 2010, 9:42 AM
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pfwein wrote:
USnavy wrote:
pfwein wrote:
cracklover wrote:
. . . Anyway, the point is that China is not exactly known for patent enforcement, to say the least. . . .

GO


I have no idea whether ClimbX has infringed Mad Rock's patents or otherwise violated any of its intellectual property rights; the mere fact that its shoes look the same isn't really enough information to have a view one way or the other.
Clearly Climb X came up with those completely identical designs all on their own.

US Navy--
I can see from your post that I didn't make my point clearly. Let me try again because I want to correct a misunderstanding that many people seem to have.

In general, a company is free to copy a competitor's products. It does not matter that it is a complete knock off. Of course there are many exceptions:

You cannot (legally) infringe another company's patents. But patents don't usually protect things like rockclimbing shoes (there exceptions to that, and I believe there were references to patents in this thread. One would have to read the relevant patents and see what inventions they cover, and compare the patents to ClimbX's shoes. Until that is done, it is premature to suggest that the ClimbX is or is not infringing Mad Rock's patents).

You also cannot (legally) copy a company's trademarks. So I could make a shoe that is identical to a Nike shoe EXCEPT I cannot include the swoosh or something confusingly similar to the swoosh. Here, the name ClimbX is of course in no way similar to Mad Rock.

There are exceptions to every rule of course and I've also seen allegations made of theft of trade secrets (without any suggestion as to what those trade secrets were).

My main point, and what I think many people fail to understand, it that it is generally OK to make knock off products. That's one reason why patents can be so important--they are in general the only way to stop other companies from making functionally equivalent knock offs of any products.

There is probably a valuable lesson to business owners to carefully consider what steps they can take to protect their intellectual property and also what agreements they should have with their employees and contractors in the nature of non-competes and such (which can be a complicated area of the law and the rules vary significantly across jurisdictions).

It’s extremely obvious that Climb X simply copied Mad Rocks products. Suggesting anything else is just complete ignorance. Did you even look at their lineup? It’s completely identical to Mad Rock's. And not just one product, everything is identical.

But there is more at work here then Climb X’s right to or not to manufacturer knock off product. As with all industries, there is a matter of trustworthiness and professionalism at work. If a company goes and simply copies another companies product; markets the product as their own; insists that it’s their design when its obvious its not; and steels the other company’s classified secrets, would you consider that company to be trustworthy and professional? Taking part in that type of business brings into question the competency, judgment, professionalism, and trustworthiness of the company. One may ask, "If I cannot trust this company to be honest about their product designs, how can I trust their product is safe for use? How can I trust it will hold my next whipper?". The answer is, you can’t.

So there is more at work here then just legal right to or not to manufacturer the product. Trust and professionalism is key. Without it, no one will buy that crap. After all, none of their product is CE, EN or UIAA certified. I think they are the only company on the market right now that holds that title. So not only are they dishonest and untrustworthy, none of their product holds any type of certifications. Sounds like they are going to be a big seller...


(This post was edited by USnavy on Apr 3, 2010, 9:45 AM)


karmiclimber


Apr 5, 2010, 1:22 PM
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So, climb x is copying mad rock's copies and selling them for 10 bucks less. What an outrage.


blueeyedclimber


Apr 5, 2010, 1:48 PM
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karmiclimber wrote:
So, climb x is copying mad rock's copies and selling them for 10 bucks less. What an outrage.

They're still not worth it.Cool


sidepull


Apr 5, 2010, 3:42 PM
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adatesman wrote:
areyoumydude wrote:
What patents?

Well, a quick search of the USPTO site turned up patents for the guy from MR:
D516783 (shoe heel)
6470599 (concave shoe sole)
6050003 (boot with outside preformed stress relief)
7107656 (safety buckle)

Looks like he has some provisional ones as well...
20070209114 (sleeping bag with air pockets)
20060037179 (another safety buckle)
20050229364 (the safety buckle from 7107656)
20050138848 (climbing shoe with tension support sole)
20040226193 (climbing shoe with hooking rim)
20030196354 (climbing shoe with hooking teeth on the heel)
20030196350 (climbing shoe with lateral sling shot band)
20030172555 (internal split toe with a creased sole for climbing shoes)
20030115776 (climbing shoe with multiple hardness rubber sole)
20030037463 (climbing shoe with hooking rim)
20020152642 (climbing shoe with concave sole)

So yeah, if ClimbX is using stuff from any of them I'd expect things to become rather interesting.

I don't understand the need for all the discussion about trade secrets, secret sauce, and the Colonel's recipe - all the patents were posted a few posts into this thread. So Mad Rock should have recourse, yes?


pfwein


Apr 5, 2010, 4:56 PM
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sidepull wrote:
adatesman wrote:
areyoumydude wrote:
What patents?

Well, a quick search of the USPTO site turned up patents for the guy from MR:
D516783 (shoe heel)
6470599 (concave shoe sole)
6050003 (boot with outside preformed stress relief)
7107656 (safety buckle)

Looks like he has some provisional ones as well...
20070209114 (sleeping bag with air pockets)
20060037179 (another safety buckle)
20050229364 (the safety buckle from 7107656)
20050138848 (climbing shoe with tension support sole)
20040226193 (climbing shoe with hooking rim)
20030196354 (climbing shoe with hooking teeth on the heel)
20030196350 (climbing shoe with lateral sling shot band)
20030172555 (internal split toe with a creased sole for climbing shoes)
20030115776 (climbing shoe with multiple hardness rubber sole)
20030037463 (climbing shoe with hooking rim)
20020152642 (climbing shoe with concave sole)

So yeah, if ClimbX is using stuff from any of them I'd expect things to become rather interesting.

I don't understand the need for all the discussion about trade secrets, secret sauce, and the Colonel's recipe - all the patents were posted a few posts into this thread. So Mad Rock should have recourse, yes?

You can't validly made that assumption without more information. Let me put it another way. The following is NOT necessarily true:
Company A owns some patents;
Company B copied some of Company A's products;
therefore Company B is infringing Company A's patents.

Here's one way to look at it: companies obtain patents for products that have not yet been released and may never be released. We don't know what products MadRock's patents cover without looking at the patents.

If anyone wants to see the patents, just go to the USPTO's website or, even easier, use Google's patent search feature: http://www.google.com/patents?hl=en

On a related point, while patents are presumed to be valid, that presumption is rebuttable, so perhaps ClimbX will take the position that MadRock's patents are invalid (to the extent it needs to). It's impossible to say in the abstract whether that's a good defense to the specific patents that may be at issue.

Also--patents and trade secrets are not necessarily one versus the other. It may be that certain aspects of a shoe are protected by a patent and other aspects (say, the formulation of the rubber) are protected as trade secrets. ClimbX could be liable for patent infringement, misappropriation of trade secrets, both, or neither.


edge


Apr 5, 2010, 5:19 PM
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blueeyedclimber wrote:
karmiclimber wrote:
So, climb x is copying mad rock's copies and selling them for 10 bucks less. What an outrage.

They're still not worth it.Cool
+1


Adk


Apr 5, 2010, 5:44 PM
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edge wrote:
blueeyedclimber wrote:
karmiclimber wrote:
So, climb x is copying mad rock's copies and selling them for 10 bucks less. What an outrage.

They're still not worth it.Cool
+1

A copy of a copy is not an inferior product.
"I used better ink than the copy so mine physical print will last longer if exposed to the elements"

The design may be stolen but the materials could be of better quality making them a better shoe even though they were cheaper to manufacture or maybe it's that Climb X isn't marking them up so much as Mad Rock.Unsure


curt


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Patents aside, I find this information on the ClimbX website to be quite troubling:

ClimbX wrote:
...Now Under New Old Management. Welcome friends and fans the first Climb X website—as you will quickly notice, the company name may be new, but the products inside these pages are longtime favorites. While we’d much rather discuss our latest designs and leave the boring office talk behind, the short story is the original owners and management have decided to take a more prominent role in the direction, product mix and strategy of this business. With this change, a new name has been chosen to set us apart and differentiate this company from the previous one: we are now Climb X. Same sales team. Same distributors. Same production facility. Same product development staff. The same award-winning products.

In this catalog, you will find many of the same products as before
(renamed, and with the usual running upgrades and color changes) as well as some fresh all-new offerings...

ClimbX is actually telling us that they are currently producing the same products "as before" - meaning when these people worked for MadRock.

Curt


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Apr 5, 2010, 6:01 PM
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curt wrote:
Patents aside, I find this information on the ClimbX website to be quite troubling:

ClimbX wrote:
...Now Under New Old Management. Welcome friends and fans the first Climb X website—as you will quickly notice, the company name may be new, but the products inside these pages are longtime favorites. While we’d much rather discuss our latest designs and leave the boring office talk behind, the short story is the original owners and management have decided to take a more prominent role in the direction, product mix and strategy of this business. With this change, a new name has been chosen to set us apart and differentiate this company from the previous one: we are now Climb X. Same sales team. Same distributors. Same production facility. Same product development staff. The same award-winning products.

In this catalog, you will find many of the same products as before
(renamed, and with the usual running upgrades and color changes) as well as some fresh all-new offerings...

ClimbX is actually telling us that they are currently producing the same products "as before" - meaning when these people worked for MadRock.

Curt

Of course! Don't you remember their original "press release"? It basically said that they are the *real* MadRock (under a new name), and Young Chu had been kicked to the curb. Here's an excerpt to refresh your memory:

In reply to:
February 5, 2010: Joseph Garland, a founding member of Mad Rock Climbing since its inception in 2002 who announced his departure from the company in early January has returned to the industry, and is now working for Mad Rock's parent company and manufacturer. Three of Mad Rock's original partners: Alex Kim, Ken Kim and Joe Garland will continue the business under the new name "Climb X," with Joe Garland being named its new President. Original Mad Rock President and partner Young Chu will retain the Mad Rock name, but is no longer a member of this group. Climb X will assume the former Mad Rock operation, its distributors, most of its sales reps, international staff, warehouse, factory & production, and product development facility, as well as its Chinese and international warehouse facilities.

GO


Adk


Apr 5, 2010, 6:03 PM
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curt wrote:
Patents aside, I find this information on the ClimbX website to be quite troubling:

ClimbX wrote:
...Now Under New Old Management. Welcome friends and fans the first Climb X website—as you will quickly notice, the company name may be new, but the products inside these pages are longtime favorites. While we’d much rather discuss our latest designs and leave the boring office talk behind, the short story is the original owners and management have decided to take a more prominent role in the direction, product mix and strategy of this business. With this change, a new name has been chosen to set us apart and differentiate this company from the previous one: we are now Climb X. Same sales team. Same distributors. Same production facility. Same product development staff. The same award-winning products.

In this catalog, you will find many of the same products as before
(renamed, and with the usual running upgrades and color changes) as well as some fresh all-new offerings...

ClimbX is actually telling us that they are currently producing the same products "as before" - meaning when these people worked for MadRock.

Curt

I honestly don't find it troubling at all.


blueeyedclimber


Apr 5, 2010, 6:31 PM
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Adk wrote:
edge wrote:
blueeyedclimber wrote:
karmiclimber wrote:
So, climb x is copying mad rock's copies and selling them for 10 bucks less. What an outrage.

They're still not worth it.Cool
+1

A copy of a copy is not an inferior product.
"I used better ink than the copy so mine physical print will last longer if exposed to the elements"

The design may be stolen but the materials could be of better quality making them a better shoe even though they were cheaper to manufacture or maybe it's that Climb X isn't marking them up so much as Mad Rock.Unsure

My point wasn't that the copy was inferior, it was that the original was inferior. They are a cheaper shoe, well, because they are a CHEAPER shoe.


jt512


Apr 5, 2010, 6:36 PM
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In reply to:
blueeyedclimber wrote:
Adk wrote:
edge wrote:
blueeyedclimber wrote:
karmiclimber wrote:
So, climb x is copying mad rock's copies and selling them for 10 bucks less. What an outrage.

They're still not worth it.Cool
+1

A copy of a copy is not an inferior product.
"I used better ink than the copy so mine physical print will last longer if exposed to the elements"

The design may be stolen but the materials could be of better quality making them a better shoe even though they were cheaper to manufacture or maybe it's that Climb X isn't marking them up so much as Mad Rock.Unsure

My point wasn't that the copy was inferior, it was that the original was inferior. They are a cheaper shoe, well, because they are a CHEAPER shoe.

Do you have any hard data to back that up, or is that just your impression?

Jay

A post merely asking for evidence gets one star. Only on rockclimbing.com

Jay


(This post was edited by jt512 on Apr 5, 2010, 6:51 PM)


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Apr 5, 2010, 6:39 PM
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Adk wrote:
curt wrote:
Patents aside, I find this information on the ClimbX website to be quite troubling:

ClimbX wrote:
...Now Under New Old Management. Welcome friends and fans the first Climb X website—as you will quickly notice, the company name may be new, but the products inside these pages are longtime favorites. While we’d much rather discuss our latest designs and leave the boring office talk behind, the short story is the original owners and management have decided to take a more prominent role in the direction, product mix and strategy of this business. With this change, a new name has been chosen to set us apart and differentiate this company from the previous one: we are now Climb X. Same sales team. Same distributors. Same production facility. Same product development staff. The same award-winning products.

In this catalog, you will find many of the same products as before
(renamed, and with the usual running upgrades and color changes) as well as some fresh all-new offerings...

ClimbX is actually telling us that they are currently producing the same products "as before" - meaning when these people worked for MadRock.

Curt

I honestly don't find it troubling at all.

Nor do I. I find the soap-opera element purely entertaining, and the "live by the sword, die by the sword" (or in this case, theft) element to be sad, but also funny in an ironic way.

GO


karmiclimber


Apr 5, 2010, 6:40 PM
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My point was that its ironic. And hilarious. "You're trying to kidnap what I've rightfully stolen!!" The biggest name in cheaper climbing shoe copies is calling no fair on someone for copying them. *Pops the popcorn*


curt


Apr 5, 2010, 6:41 PM
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Adk wrote:
curt wrote:
Patents aside, I find this information on the ClimbX website to be quite troubling:

ClimbX wrote:
...Now Under New Old Management. Welcome friends and fans the first Climb X website—as you will quickly notice, the company name may be new, but the products inside these pages are longtime favorites. While we’d much rather discuss our latest designs and leave the boring office talk behind, the short story is the original owners and management have decided to take a more prominent role in the direction, product mix and strategy of this business. With this change, a new name has been chosen to set us apart and differentiate this company from the previous one: we are now Climb X. Same sales team. Same distributors. Same production facility. Same product development staff. The same award-winning products.

In this catalog, you will find many of the same products as before
(renamed, and with the usual running upgrades and color changes) as well as some fresh all-new offerings...

ClimbX is actually telling us that they are currently producing the same products "as before" - meaning when these people worked for MadRock.

Curt

I honestly don't find it troubling at all.

Well, some people have ethics and some people don't.

Curt


karmiclimber


Apr 5, 2010, 6:43 PM
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Yeah, Mad Rock had mad ethics when they copied other climbing companies.


curt


Apr 5, 2010, 6:48 PM
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karmiclimber wrote:
Yeah, Mad Rock had mad ethics when they copied other climbing companies.

Oh, I'm not defending MadRock. I'm simply calling BS on ClimbX.

Curt


Adk


Apr 5, 2010, 6:51 PM
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curt wrote:
Adk wrote:
curt wrote:
Patents aside, I find this information on the ClimbX website to be quite troubling:

ClimbX wrote:
...Now Under New Old Management. Welcome friends and fans the first Climb X website—as you will quickly notice, the company name may be new, but the products inside these pages are longtime favorites. While we’d much rather discuss our latest designs and leave the boring office talk behind, the short story is the original owners and management have decided to take a more prominent role in the direction, product mix and strategy of this business. With this change, a new name has been chosen to set us apart and differentiate this company from the previous one: we are now Climb X. Same sales team. Same distributors. Same production facility. Same product development staff. The same award-winning products.

In this catalog, you will find many of the same products as before
(renamed, and with the usual running upgrades and color changes) as well as some fresh all-new offerings...

ClimbX is actually telling us that they are currently producing the same products "as before" - meaning when these people worked for MadRock.

Curt

I honestly don't find it troubling at all.

Well, some people have ethics and some people don't.

Curt

Right. Ethics or morals?


Partner cracklover


Apr 5, 2010, 7:17 PM
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curt wrote:
karmiclimber wrote:
Yeah, Mad Rock had mad ethics when they copied other climbing companies.

Oh, I'm not defending MadRock. I'm simply calling BS on ClimbX.

Curt

Oh come on, Curt. I know you have a soft spot for MR, but when you look at how they got their start, doesn't this simply seem like them getting their just desserts?

GO


edge


Apr 5, 2010, 7:21 PM
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Adk wrote:
edge wrote:
blueeyedclimber wrote:
karmiclimber wrote:
So, climb x is copying mad rock's copies and selling them for 10 bucks less. What an outrage.

They're still not worth it.Cool
+1

A copy of a copy is not an inferior product.
"I used better ink than the copy so mine physical print will last longer if exposed to the elements"

The design may be stolen but the materials could be of better quality making them a better shoe even though they were cheaper to manufacture or maybe it's that Climb X isn't marking them up so much as Mad Rock.Unsure

So you are hoping that the stolen designs, made in the very same factory, will be made with increased care, better materials, and for a lower price?

I'm not a betting man, but that hypothesis may make me one.


(This post was edited by edge on Apr 5, 2010, 7:46 PM)


curt


Apr 5, 2010, 7:46 PM
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cracklover wrote:
curt wrote:
karmiclimber wrote:
Yeah, Mad Rock had mad ethics when they copied other climbing companies.

Oh, I'm not defending MadRock. I'm simply calling BS on ClimbX.

Curt

Oh come on, Curt. I know you have a soft spot for MR, but when you look at how they got their start, doesn't this simply seem like them getting their just desserts?

GO

I don't know enough of the details about the breakup between Young Chu and Charles Cole to comment definitively. It is my understanding, however, that at least some of the designs and product development that ended up in the MadRock shoes was done jointly between the two. My source for that information is a long-time 5.10 employee.

So, I am less certain about any impropriety that may have occurred at MadRock's inception--maybe so, maybe not, I simply don't know. On the other hand, ClimbX, in my view, is a blatant rip-off of MadRock.

Curt


Adk


Apr 5, 2010, 7:47 PM
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edge wrote:
Adk wrote:
edge wrote:
blueeyedclimber wrote:
karmiclimber wrote:
So, climb x is copying mad rock's copies and selling them for 10 bucks less. What an outrage.

They're still not worth it.Cool
+1

A copy of a copy is not an inferior product.
"I used better ink than the copy so mine physical print will last longer if exposed to the elements"

The design may be stolen but the materials could be of better quality making them a better shoe even though they were cheaper to manufacture or maybe it's that Climb X isn't marking them up so much as Mad Rock.Unsure

So you are hoping that the stolen designs, made in the very same factory, will be made with increased care, better materials, and for a lower price?

I'm not a betting man, but that hypothesis may be an exception.

I haven't seen anywhere that they will be made in the same factory or with the same materials. I've seen that some of the same basic designs or looks are being carried through though.
The real question to some is who has the right to use them.
I honestly could care less who has the right. That is for them to decide.
I'm glad that the company has split. It will be a good thing in the end. One company will flourish and the other will either wither or finally pull it's head out of the sand.


curt


Apr 5, 2010, 8:01 PM
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Adk wrote:
edge wrote:
Adk wrote:
edge wrote:
blueeyedclimber wrote:
karmiclimber wrote:
So, climb x is copying mad rock's copies and selling them for 10 bucks less. What an outrage.

They're still not worth it.Cool
+1

A copy of a copy is not an inferior product.
"I used better ink than the copy so mine physical print will last longer if exposed to the elements"

The design may be stolen but the materials could be of better quality making them a better shoe even though they were cheaper to manufacture or maybe it's that Climb X isn't marking them up so much as Mad Rock.Unsure

So you are hoping that the stolen designs, made in the very same factory, will be made with increased care, better materials, and for a lower price?

I'm not a betting man, but that hypothesis may be an exception.

I haven't seen anywhere that they will be made in the same factory or with the same materials...

Then you haven't been paying attention.

Curt


edge


Apr 5, 2010, 8:03 PM
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Adk wrote:

I haven't seen anywhere that they will be made in the same factory

You quoted that yourself four posts up.

Production facility = factory in Chinese.


Partner cracklover


Apr 5, 2010, 8:06 PM
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Adk wrote:
edge wrote:
Adk wrote:
edge wrote:
blueeyedclimber wrote:
karmiclimber wrote:
So, climb x is copying mad rock's copies and selling them for 10 bucks less. What an outrage.

They're still not worth it.Cool
+1

A copy of a copy is not an inferior product.
"I used better ink than the copy so mine physical print will last longer if exposed to the elements"

The design may be stolen but the materials could be of better quality making them a better shoe even though they were cheaper to manufacture or maybe it's that Climb X isn't marking them up so much as Mad Rock.Unsure

So you are hoping that the stolen designs, made in the very same factory, will be made with increased care, better materials, and for a lower price?

I'm not a betting man, but that hypothesis may be an exception.

I haven't seen anywhere that they will be made in the same factory or with the same materials.

Then you're not paying any attention. They said quite clearly that they took over the Chinese operations (including the factory).

GO


edge


Apr 5, 2010, 8:08 PM
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Wow, Curt, Edge, and Cracklover all of the same opinion?

Where's the wormhole, I don't remember tumbling into a wormhole...


Partner cracklover


Apr 5, 2010, 8:36 PM
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D'oh! I posted too slowly...

That's what I get for actually working.

Anyway, in response to this:

In reply to:
I don't know enough of the details about the breakup between Young Chu and Charles Cole to comment definitively. It is my understanding, however, that at least some of the designs and product development that ended up in the MadRock shoes was done jointly between the two. My source for that information is a long-time 5.10 employee.

So, I am less certain about any impropriety that may have occurred at MadRock's inception--maybe so, maybe not, I simply don't know. On the other hand, ClimbX, in my view, is a blatant rip-off of MadRock.

Yeah, sure, there is no rock-solid evidence that the guy who left five ten under suspicious circumstances and then started making cheap knock-offs in China did anything untoward.

You are absolutely right, I suppose, and perhaps we should all give the original founders of of Mad Rock the benefit of the doubt.

But if so, then why not extend that same courtesy to the current "controversy"? One could argue that the whole thing may be a misunderstanding that's been blown out of proportion. Or even go so far as to suggest that Joe might have been the aggrieved party, who was summarily fired, but everyone except senior execs sided with him, and wanted him to keep running their company the "right" way, while the big bad executives moved to Vietnam just to cut out the workers demanding a fair wage.

Any number of fairy tales could be dreamed up.

But so far as I'm concerned, if it looks like a duck and quacks like a duck... then the old saying about there being no honor among thieves seems apropos.

GO


sidepull


Apr 5, 2010, 8:42 PM
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pfwein wrote:
sidepull wrote:
adatesman wrote:
areyoumydude wrote:
What patents?

Well, a quick search of the USPTO site turned up patents for the guy from MR:
D516783 (shoe heel)
6470599 (concave shoe sole)
6050003 (boot with outside preformed stress relief)
7107656 (safety buckle)

Looks like he has some provisional ones as well...
20070209114 (sleeping bag with air pockets)
20060037179 (another safety buckle)
20050229364 (the safety buckle from 7107656)
20050138848 (climbing shoe with tension support sole)
20040226193 (climbing shoe with hooking rim)
20030196354 (climbing shoe with hooking teeth on the heel)
20030196350 (climbing shoe with lateral sling shot band)
20030172555 (internal split toe with a creased sole for climbing shoes)
20030115776 (climbing shoe with multiple hardness rubber sole)
20030037463 (climbing shoe with hooking rim)
20020152642 (climbing shoe with concave sole)

So yeah, if ClimbX is using stuff from any of them I'd expect things to become rather interesting.

I don't understand the need for all the discussion about trade secrets, secret sauce, and the Colonel's recipe - all the patents were posted a few posts into this thread. So Mad Rock should have recourse, yes?

You can't validly made that assumption without more information. Let me put it another way. The following is NOT necessarily true:
Company A owns some patents;
Company B copied some of Company A's products;
therefore Company B is infringing Company A's patents.

Here's one way to look at it: companies obtain patents for products that have not yet been released and may never be released. We don't know what products MadRock's patents cover without looking at the patents.

If anyone wants to see the patents, just go to the USPTO's website or, even easier, use Google's patent search feature: http://www.google.com/patents?hl=en

On a related point, while patents are presumed to be valid, that presumption is rebuttable, so perhaps ClimbX will take the position that MadRock's patents are invalid (to the extent it needs to). It's impossible to say in the abstract whether that's a good defense to the specific patents that may be at issue.

Also--patents and trade secrets are not necessarily one versus the other. It may be that certain aspects of a shoe are protected by a patent and other aspects (say, the formulation of the rubber) are protected as trade secrets. ClimbX could be liable for patent infringement, misappropriation of trade secrets, both, or neither.

Excellent! You've done a great job of proving why people hate lawyers!


Adk


Apr 5, 2010, 8:43 PM
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I thought Mad Rock moved their facility?
..just say....WRONG!!!!!Cool

I could have swore though. LOL!


Partner cracklover


Apr 5, 2010, 8:55 PM
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Adk wrote:
I thought Mad Rock moved their facility?
..just say....WRONG!!!!!Cool

I could have swore though. LOL!

Uhhh... I still think you're unclear of the situation. Maybe you should review the earlier threads? MR is now operating out of Vietnam (IIRC - I know it's southeast Asia), while ClimbX is in their old facilities in China.

GO


Adk


Apr 5, 2010, 9:22 PM
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That is right. Climb X is producing in the OLD-NEW factory and Mad rock has moved to Vietnam to their NEW factory.

So maybe Mad Rock is using the same materials then....Crazy


Adk


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Either way. Some of hte products are the exact same as of now with different names. The question for some is who has the rights to them.

I could care less. Gimme good cheap products cuz the economy is terrible.Laugh


xaniel2000


Apr 5, 2010, 10:09 PM
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I am concerned about the athletes on Team Mad Rock that may suffer from the impact Climb X could potentially have on Mad Rock's sales and/or legal costs (probably both), which may result in a reduced operations budget for Mad Rock's sponsorship programs.

I wonder if Joe Garland considered the well-being of these promising athletes before he proceeded with this transparent sham of an enterprise.


Adk


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xaniel2000 wrote:
I am concerned about the athletes on Team Mad Rock that may suffer from the impact Climb X could potentially have on Mad Rock's sales and/or legal costs (probably both), which may result in a reduced operations budget for Mad Rock's sponsorship programs.

I wonder if Joe Garland considered the well-being of these promising athletes before he proceeded with this transparent sham of an enterprise.

I'm interested in the athletes that Climb X decides to bring on board.Wink


jt512


Apr 5, 2010, 10:59 PM
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xaniel2000 wrote:
I am concerned about the athletes on Team Mad Rock that may suffer from the impact Climb X could potentially have on Mad Rock's sales and/or legal costs (probably both), which may result in a reduced operations budget for Mad Rock's sponsorship programs.

I wonder if Joe Garland considered the well-being of these promising athletes before he proceeded with this transparent sham of an enterprise.

I'm pretty sure that was the first thing on his mind.

Jay


johnwesely


Apr 5, 2010, 11:28 PM
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xaniel2000 wrote:
I am concerned about the athletes on Team Mad Rock that may suffer from the impact Climb X could potentially have on Mad Rock's sales and/or legal costs (probably both), which may result in a reduced operations budget for Mad Rock's sponsorship programs.

I wonder if Joe Garland considered the well-being of these promising athletes before he proceeded with this transparent sham of an enterprise.

I know that I have been praying for them every night before I go to bed.


climbingtrash


Apr 6, 2010, 2:00 AM
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johnwesely wrote:
xaniel2000 wrote:
I am concerned about the athletes on Team Mad Rock that may suffer from the impact Climb X could potentially have on Mad Rock's sales and/or legal costs (probably both), which may result in a reduced operations budget for Mad Rock's sponsorship programs.

I wonder if Joe Garland considered the well-being of these promising athletes before he proceeded with this transparent sham of an enterprise.

I know that I have been praying for them every night before I go to bed.

+1 Cool


sidepull


Apr 6, 2010, 2:00 AM
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johnwesely wrote:
xaniel2000 wrote:
I am concerned about the athletes on Team Mad Rock that may suffer from the impact Climb X could potentially have on Mad Rock's sales and/or legal costs (probably both), which may result in a reduced operations budget for Mad Rock's sponsorship programs.

I wonder if Joe Garland considered the well-being of these promising athletes before he proceeded with this transparent sham of an enterprise.

I know that I have been praying for them every night before I go to bed.

Thou art a saint Angelic


xaniel2000


Apr 6, 2010, 2:25 AM
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I should've anticipated the 'Net nerd responses before making an earnest post, but I couldn't help it. I just returned from The Red where I happened to come across a few Mad Rock athletes projecting some hard routes in The Sanctuary. They were friendly and obviously stoked on climbing, so when I saw this thread I immediately thought of those guys. I don't really follow industry gossip, but watching those guys climb got me psyched to climb, and in the end that matters most to me.


USnavy


Apr 6, 2010, 3:36 AM
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xaniel2000 wrote:
I am concerned about the athletes on Team Mad Rock that may suffer from the impact Climb X could potentially have on Mad Rock's sales and/or legal costs (probably both), which may result in a reduced operations budget for Mad Rock's sponsorship programs.

I wonder if Joe Garland considered the well-being of these promising athletes before he proceeded with this transparent sham of an enterprise.

Don’t worry, the lawsuit that Mad Rock wins against Climb X will help compensate for any losses. However something tells me that money is more likely to go towards a new Ferrari then the sponsors. Crazy


(This post was edited by USnavy on Apr 6, 2010, 3:37 AM)


areyoumydude


Apr 6, 2010, 6:02 AM
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USnavy wrote:
xaniel2000 wrote:
I am concerned about the athletes on Team Mad Rock that may suffer from the impact Climb X could potentially have on Mad Rock's sales and/or legal costs (probably both), which may result in a reduced operations budget for Mad Rock's sponsorship programs.

I wonder if Joe Garland considered the well-being of these promising athletes before he proceeded with this transparent sham of an enterprise.

Don’t worry, the lawsuit that Mad Rock wins against Climb X will help compensate for any losses. However something tells me that money is more likely to go towards a new Ferrari then the sponsors. Crazy

Something tells me you like to post just to post.


airscape


Apr 6, 2010, 11:06 AM
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They do not have the shoes with the Skulls...

ClimbX rocks like mad!


climbingtrash


Apr 6, 2010, 11:33 AM
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areyoumydude wrote:
USnavy wrote:
xaniel2000 wrote:
I am concerned about the athletes on Team Mad Rock that may suffer from the impact Climb X could potentially have on Mad Rock's sales and/or legal costs (probably both), which may result in a reduced operations budget for Mad Rock's sponsorship programs.

I wonder if Joe Garland considered the well-being of these promising athletes before he proceeded with this transparent sham of an enterprise.

Don’t worry, the lawsuit that Mad Rock wins against Climb X will help compensate for any losses. However something tells me that money is more likely to go towards a new Ferrari then the sponsors. Crazy

Something tells me you like to post just to post.

PJTPFTW!!11


blueeyedclimber


Apr 6, 2010, 12:34 PM
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jt512 wrote:
In reply to:
blueeyedclimber wrote:
Adk wrote:
edge wrote:
blueeyedclimber wrote:
karmiclimber wrote:
So, climb x is copying mad rock's copies and selling them for 10 bucks less. What an outrage.

They're still not worth it.Cool
+1

A copy of a copy is not an inferior product.
"I used better ink than the copy so mine physical print will last longer if exposed to the elements"

The design may be stolen but the materials could be of better quality making them a better shoe even though they were cheaper to manufacture or maybe it's that Climb X isn't marking them up so much as Mad Rock.Unsure

My point wasn't that the copy was inferior, it was that the original was inferior. They are a cheaper shoe, well, because they are a CHEAPER shoe.

Do you have any hard data to back that up, or is that just your impression?

Jay

A post merely asking for evidence gets one star. Only on rockclimbing.com

Jay

Evidence that they are a cheaper shoe? The pricetag. Now, as for my implication that they are a CRAPPY shoe? That is merely my opinion, but an opinion based on trying two of their models, the Mugen and the Flash. They did not perform nearly as well as other shoes I have tried. Compared to La Sportiva, which I wear pretty much exclusively now, they fell FAR short. The Flash is a nice beginner shoe, but not much more.

As for the one star, it seems you are attracting a lot of those Laugh And before you ask, NO, it wasn't me.

Josh


kachoong


Apr 6, 2010, 1:03 PM
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All this is a plan to boost sales. Mad Rock pretends to be Climb X who's pretending to be Mad Rock who pretends to have great gear. Sales of both fund the same parent owners as they plead for your loyalty and stop the bipartisan fleet from sinking.


airscape


Apr 6, 2010, 1:18 PM
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DO you think climbX crashpads will turn into a Couch too?


Partner gamehendge


Apr 6, 2010, 2:44 PM
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kachoong wrote:
All this is a plan to boost sales. Mad Rock pretends to be Climb X who's pretending to be Mad Rock who pretends to have great gear. Sales of both fund the same parent owners as they plead for your loyalty and stop the bipartisan fleet from sinking.
Climb X products are an imitation made with the intention to deceive the consumer into believing it to be genuine Mad Rock products. Mad Rock and its parent company Nelson Sports Inc. has no affiliation with Climb X or its products, which violates numerous patent and copyright laws.

-according to official Mad Rock press release.


shockabuku


Apr 6, 2010, 2:58 PM
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xaniel2000 wrote:
I should've anticipated the 'Net nerd responses before making an earnest post, but I couldn't help it. I just returned from The Red where I happened to come across a few Mad Rock athletes projecting some hard routes in The Sanctuary. They were friendly and obviously stoked on climbing, so when I saw this thread I immediately thought of those guys. I don't really follow industry gossip, but watching those guys climb got me psyched to climb, and in the end that matters most to me.

I bet those people can still chose to climb regardless of what happens.


shockabuku


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USnavy wrote:
xaniel2000 wrote:
I am concerned about the athletes on Team Mad Rock that may suffer from the impact Climb X could potentially have on Mad Rock's sales and/or legal costs (probably both), which may result in a reduced operations budget for Mad Rock's sponsorship programs.

I wonder if Joe Garland considered the well-being of these promising athletes before he proceeded with this transparent sham of an enterprise.

Don’t worry, the lawsuit that Mad Rock wins against Climb X will help compensate for any losses. However something tells me that money is more likely to go towards a new Ferrari then the sponsors. Crazy

Than.


moose_droppings


Apr 6, 2010, 4:16 PM
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shockabuku wrote:
Than.

Then it's all about that than again rather than being about what was then?.


billcoe_


Apr 6, 2010, 4:16 PM
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Regardless of what all the internet pundits are saying, Joe Garland and ClimbX will be around for a long time. We should welcome both the competition and the experience Joe and his group are bringing. Let Young dude worry about his business and where Mad Rock is going. The competition will sharpen them up too. Joe saw his chance and was able to seamlessly move into an ownership role with the highest margin product made by an already experienced team of low cost, shoe making pros.

He shoots! He SCORES!! WE WIN!!


jt512


Apr 6, 2010, 5:57 PM
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blueeyedclimber wrote:
jt512 wrote:
In reply to:
blueeyedclimber wrote:
Adk wrote:
edge wrote:
blueeyedclimber wrote:
karmiclimber wrote:
So, climb x is copying mad rock's copies and selling them for 10 bucks less. What an outrage.

They're still not worth it.Cool
+1

A copy of a copy is not an inferior product.
"I used better ink than the copy so mine physical print will last longer if exposed to the elements"

The design may be stolen but the materials could be of better quality making them a better shoe even though they were cheaper to manufacture or maybe it's that Climb X isn't marking them up so much as Mad Rock.Unsure

My point wasn't that the copy was inferior, it was that the original was inferior. They are a cheaper shoe, well, because they are a CHEAPER shoe.

Do you have any hard data to back that up, or is that just your impression?

Jay

A post merely asking for evidence gets one star. Only on rockclimbing.com

Jay

Evidence that they are a cheaper shoe? The pricetag.

That was an intelligent comment. You seem to be having trouble understanding your own statement.

In reply to:
Now, as for my implication that they are a CRAPPY shoe? That is merely my opinion, but an opinion based on trying two of their models, the Mugen and the Flash. They did not perform nearly as well as other shoes I have tried. Compared to La Sportiva, which I wear pretty much exclusively now, they fell FAR short.

Not exactly specific, but anyway, the reason behind my question (which, as usual, I have to explain to you), is that climbing shoes in the US are overpriced, either because of imperfect competition or, less likely, actual price fixing. To see this, compare prices for the exact same shoes in Europe. Thus the fact that Mad Rocks have a lower retail price than their competitors (in the US) does not imply that the shoes are lower in quality; they may just not be going along with the price structure in the market.

In reply to:
As for the one star, it seems you are attracting a lot of those....

What? Blueyedclimber missed the point of a comment? Stop the presses!

Jay


(This post was edited by jt512 on Apr 6, 2010, 5:57 PM)


k.l.k


Apr 6, 2010, 6:12 PM
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jt512 wrote:
. . . climbing shoes in the US are overpriced, either because of imperfect competition or, less likely, actual price fixing.

Well, I didn't see much evidence of that when I visited outdoor retailers in Europe last year. I guess I'll find out average price ranges once I'm back, this summer.

The climbing shoe market in the US is already insanely crowded. The profit margins aren't like the ones on most clothing, including most technical clothing.

The strong-arm tactics generally involve forcing stores to buy an entire line (rather than the single model they want) or forcing them to NOT buy a competitor's product or even muscling display.


(This post was edited by k.l.k on Apr 6, 2010, 6:12 PM)


blueeyedclimber


Apr 6, 2010, 6:45 PM
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jt512 wrote:



That was an intelligent comment. You seem to be having trouble understanding your own statement.

I don't think so but whatever.

In reply to:
Not exactly specific, but anyway, the reason behind my question (which, as usual, I have to explain to you), is that climbing shoes in the US are overpriced, either because of imperfect competition or, less likely, actual price fixing. To see this, compare prices for the exact same shoes in Europe. Thus the fact that Mad Rocks have a lower retail price than their competitors (in the US) does not imply that the shoes are lower in quality; they may just not be going along with the price structure in the market.

That's fair. I don't know very much about the business end of it, so I'll take your word for it. According to my comment, I was indeed implying that. If that's not the case, then I retract how I worded it, but not the fact that it is a crappy shoe.

In reply to:

What? Blueyedclimber missed the point of a comment? Stop the presses!

Jay

Actually, I knew exactly what you were saying, but I find it amusing that people feel the need to give you one star no matter what you post, based solely on the fact that you are an asswipeTongue What?! Jay's an ASSWIPE? STOP.THE.PRESSES!!!!


(This post was edited by blueeyedclimber on Apr 6, 2010, 6:47 PM)


edge


Apr 6, 2010, 6:51 PM
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jt512 wrote:
Thus the fact that Mad Rocks have a lower retail price than their competitors (in the US) does not imply that the shoes are lower in quality;

This statement is true. However, the fact that Mad Rocks, in my experience, tend to fall apart far faster than other brands does imply that the shoes are lower in quality.

It has nothing to do with price, it has more to do with seams blowing, rubber peeling, and the shoes wearing out considerably faster.


jt512


Apr 6, 2010, 7:49 PM
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edge wrote:
jt512 wrote:
Thus the fact that Mad Rocks have a lower retail price than their competitors (in the US) does not imply that the shoes are lower in quality;

This statement is true. However, the fact that Mad Rocks, in my experience, tend to fall apart far faster than other brands does imply that the shoes are lower in quality.

It has nothing to do with price, it has more to do with seams blowing, rubber peeling, and the shoes wearing out considerably faster.

How recent is your experience? When the brand first came out I heard complaints about quality, and, I have to admit, that image, reinforced by the stigma of a low price point, has stuck with me. However, the brand is very popular here in SoCal, and, to be honest, I haven't heard a single complaint about their quality in years.

Jay


(This post was edited by jt512 on Apr 6, 2010, 7:51 PM)


jt512


Apr 6, 2010, 7:55 PM
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k.l.k wrote:
jt512 wrote:
. . . climbing shoes in the US are overpriced, either because of imperfect competition or, less likely, actual price fixing.

Well, I didn't see much evidence of that when I visited outdoor retailers in Europe last year. I guess I'll find out average price ranges once I'm back, this summer.

The climbing shoe market in the US is already insanely crowded.

In what sense? There are only a handful of brands, with a few, distinct market leaders, like Sportiva and Five Ten.

If the market really is "crowded," then shoe prices should be low, but they're not. This is evidence for imperfect competition.

Jay


(This post was edited by jt512 on Apr 6, 2010, 7:55 PM)


james481


Apr 6, 2010, 8:25 PM
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jt512 wrote:
In what sense? There are only a handful of brands, with a few, distinct market leaders, like Sportiva and Five Ten.

If the market really is "crowded," then shoe prices should be low, but they're not. This is evidence for imperfect competition.

Jay

No, rock shoe prices are high not because of a lack of competition, but because rock shoes are essentially a specialty, low volume item when compared to the vast majority of other sporting goods. In fact, I'd be inclined to agree with k.l.k., that the market is quite crowded considering the specialty nature of the product. I doubt there are very many specialty sports products that are available from as many companies as rock shoes.


k.l.k


Apr 6, 2010, 8:30 PM
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jt512 wrote:
k.l.k wrote:
jt512 wrote:
. . . climbing shoes in the US are overpriced, either because of imperfect competition or, less likely, actual price fixing.

Well, I didn't see much evidence of that when I visited outdoor retailers in Europe last year. I guess I'll find out average price ranges once I'm back, this summer.

The climbing shoe market in the US is already insanely crowded.

In what sense? There are only a handful of brands, with a few, distinct market leaders, like Sportiva and Five Ten.

If the market really is "crowded," then shoe prices should be low, but they're not. This is evidence for imperfect competition.

"Handful" and "low" as compared to what?

5.10, Sportiva, Scarpa, Evolv, MadRock, Red Chili, Mammut, Boreal, Acopa, Millet, and Pillar are the cos. I can name off the top of my head. That's a lot of folks scrumming for a really small market-- climbing just isn't that popular.

Moreover, the well-made shoes remain pretty labor intensive. Each one is still hand-lasted. They have to be ultra-light, yet endure serious abuse (starting with most customers buying too small).

My Testarossas have an incredibly complicated pattern, with many pieces and hand-stitched seams-- they are far more expensive to make than a comparable pair of running shoes, and have a far smaller potential market, yet they retail for about the same price.

And most inflation calculators suggest that we pay less for climbing shoes than we did thirty years ago.

So I can't see climbing shoe prices as "high" in comparison to comps for other, more popular sports with huge markets, or in comparison with historic pricing.

5.10 and Sportiva may (do) muscle retailers over line buying, competitors, and display, but e-tail means that the shops aren't the only outlets.

The margins on shoes should be better than on, say, tents or high-altitude down suits, but much lower than on fleeces or underwear or most other articles of clothing. If I were looking to make money off some entrepreneurial niche in climbing, shoe would be one of the last places i'd look.

Not that any of this has much to say about the ClimbX/MadRock divorce.


johnwesely


Apr 6, 2010, 8:32 PM
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jt512 wrote:


How recent is your experience? When the brand first came out I heard complaints about quality, and, I have to admit, that image, reinforced by the stigma of a low price point, has stuck with me. However, the brand is very popular here in SoCal, and, to be honest, I haven't heard a single complaint about their quality in years.

Jay

I have climbed almost exclusively with Mad Rocks for the last five years and have never had a pair wear out due to poor workmanship. In fact, I had a pair of Flashes that lasted an entire year before the rubber wore out of the toe. I have never heard a first hand story of them falling apart, yet I always here people that never use them say that they do.


jt512


Apr 6, 2010, 8:48 PM
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james481 wrote:
jt512 wrote:
In what sense? There are only a handful of brands, with a few, distinct market leaders, like Sportiva and Five Ten.

If the market really is "crowded," then shoe prices should be low, but they're not. This is evidence for imperfect competition.

Jay

No, rock shoe prices are high not because of a lack of competition, but because rock shoes are essentially a specialty, low volume item when compared to the vast majority of other sporting goods.

Then why—at least a few years ago—could you buy the same shoes in Europe for about half the price as in the US?

Jay


k.l.k


Apr 6, 2010, 8:50 PM
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btw, for what it's worth, i'm all for the original factory in china continuing on making shoes, keeping their employees employed, and having that shoe-making skill conserved rather than disappear.

so good luck to climbx.


k.l.k


Apr 6, 2010, 8:53 PM
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jt512 wrote:
james481 wrote:
jt512 wrote:
In what sense? There are only a handful of brands, with a few, distinct market leaders, like Sportiva and Five Ten.

If the market really is "crowded," then shoe prices should be low, but they're not. This is evidence for imperfect competition.

Jay

No, rock shoe prices are high not because of a lack of competition, but because rock shoes are essentially a specialty, low volume item when compared to the vast majority of other sporting goods.

Then why—at least a few years ago—could you buy the same shoes in Europe for about half the price as in the US?

For a long time, shoes were cheaper in Europe because most of them were made there. US importers tacked shipping and their own profi margin onto the shoe. With the globalization of supply chains, and improvement of logistics, that's not as big of an issue as it was even 15 years ago.

In 2000 I found Sportivas to be slightly cheaper in most European retailers I visited-- but that's not been the case on the trips I've done since.


adatesman


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k.l.k


Apr 6, 2010, 9:25 PM
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adatesman wrote:
k.l.k wrote:
jt512 wrote:
james481 wrote:
jt512 wrote:
In what sense? There are only a handful of brands, with a few, distinct market leaders, like Sportiva and Five Ten.

If the market really is "crowded," then shoe prices should be low, but they're not. This is evidence for imperfect competition.

Jay

No, rock shoe prices are high not because of a lack of competition, but because rock shoes are essentially a specialty, low volume item when compared to the vast majority of other sporting goods.

Then why—at least a few years ago—could you buy the same shoes in Europe for about half the price as in the US?

For a long time, shoes were cheaper in Europe because most of them were made there. US importers tacked shipping and their own profi margin onto the shoe. With the globalization of supply chains, and improvement of logistics, that's not as big of an issue as it was even 15 years ago.

In 2000 I found Sportivas to be slightly cheaper in most European retailers I visited-- but that's not been the case on the trips I've done since.

I'd think a stronger dollar probably had something to do with it as well.... $1 was 1.12 Euros in 2001 and is only .75 Euros today.

sorry, i should've mentioned-- that's after adjusting for the exchange.


jt512


Apr 6, 2010, 9:25 PM
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k.l.k wrote:
jt512 wrote:
k.l.k wrote:
jt512 wrote:
. . . climbing shoes in the US are overpriced, either because of imperfect competition or, less likely, actual price fixing.

Well, I didn't see much evidence of that when I visited outdoor retailers in Europe last year. I guess I'll find out average price ranges once I'm back, this summer.

The climbing shoe market in the US is already insanely crowded.

In what sense? There are only a handful of brands, with a few, distinct market leaders, like Sportiva and Five Ten.

If the market really is "crowded," then shoe prices should be low, but they're not. This is evidence for imperfect competition.

"Handful" and "low" as compared to what?

A handful compared to the number of suppliers required for the market to behave as a competitive free market, and "low," meaning what the price would be if classic free market competition were operative.

In reply to:
5.10, Sportiva, Scarpa, Evolv, MadRock, Red Chili, Mammut, Boreal, Acopa, Millet, and Pillar are the cos. I can name off the top of my head.

Of those brands, only Five Ten, Sportiva, Evolv, MadRock, and maybe Boreal have significant market shares in the US (who has even heard of Millet and Pillar?). So, you have four or five companies in the market, of which one or two—Five Ten and maybe Sportiva—are market leaders. That's not classic free market competition; it's an oligopoly.

In reply to:
That's a lot of folks scrumming for a really small market-- climbing just isn't that popular

And when there are price leaders in the market, the revenues of a non-price leader decrease when the price leader lowers its prices, since the non-price leaders will just match the lower price. Hence there is no incentive (in fact, there is a disincentive) to lower price. In contrast, if a price leader raises their prices, the non-leaders revenues will increase by their matching the price increase. Prices are thus set by the elasticity of demand of the price leader's product, not by classic supply and demand curves, resulting in excessive prices, by classic free market standards. That's me thinking back to intermediate economics courses I took 25 years ago. Hopefully, someone with greater expertise in oligopoly economics will help out here with corrections.

In reply to:
Moreover, the well-made shoes remain pretty labor intensive. Each one is still hand-lasted. They have to be ultra-light, yet endure serious abuse (starting with most customers buying too small). My Testarossas have an incredibly complicated pattern, with many pieces and hand-stitched seams

And why, then, do the less well-made shoes that weaken and fall apart within months (eg, Five Tens) sell for the same price as better-made shoes (eg, Sportivas)? Because Five Ten, being the market leader, sets the price of shoes in the US market.

In reply to:
So I can't see climbing shoe prices as "high" in comparison to comps for other, more popular sports with huge markets, or in comparison with historic pricing.

But they are very high, compared with Europe (or at least they were a few years ago, when Americans could buy shoes from Barrabes). Why is that?

Jay


k.l.k


Apr 6, 2010, 9:41 PM
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jt512 wrote:
Of those brands, only Five Ten, Sportiva, Evolv, MadRock, and maybe Boreal have significant market shares in the US (who has even heard of Millet and Pillar?). So, you have four or five companies in the market, of which one or two—Five Ten and maybe Sportiva—are market leaders. That's not classic free market competition; it's an oligopoly.

I don't have a reliable breakdown of market share per co., but strongly doubt that oligopoly is keeping climbing shoe prices artificially high. As I pointed out, those prices are not historically high. And they aren't high (quite the opposite, in fact) as compared to other athletic shoes with bigger markets and production.

I have heard anecdotal evidence of the two majors muscling up on local retailers to keep out competitors. Artificial barriers to entry is one of the classic components of Econ 101 definitions of oligopoly. But there are so many other factors involved-- strength of the rep force, success of branding, etc. --that I don't have nearly enough evidence to start having to choose among the various competing theories of oligopoly, let alone apply them to measure that market impact. If you have that evidence, please share it with us.


k.l.k


Apr 6, 2010, 9:51 PM
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jt512 wrote:
And why, then, do the less well-made shoes that weaken and fall apart within months (eg, Five Tens) sell for the same price as better-made shoes (eg, Sportivas)?

You're assuming first, that durability is the key feature climbers want in a shoe; and that Sportivas are clearly, visibly and measurably more durable than comparable 5.10s, and I mean "visible" and "measurable" to actual consumers.

I don't know that either of those assumptions is true. In fact, I know that the first isn't true--except among old traddies who all get bro deals anyway.

As for the second assumption, that Sportivas are better made than 5.10s, I share yr appreciation of the more demanding patterns and natural materials used in Testarossas and TC Pros. But many folks don't.

And one of the key features of the shoe market in the last few years, is its gradual breakdown into multiple pricepoints. Sportiva, for instance, now runs a line of cheaper, simpler shoes made in Asia at a much lower price than its nicest, Italian (or at least Romanian) produced models.


jt512


Apr 6, 2010, 9:53 PM
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k.l.k wrote:
jt512 wrote:
Of those brands, only Five Ten, Sportiva, Evolv, MadRock, and maybe Boreal have significant market shares in the US (who has even heard of Millet and Pillar?). So, you have four or five companies in the market, of which one or two—Five Ten and maybe Sportiva—are market leaders. That's not classic free market competition; it's an oligopoly.

I don't have a reliable breakdown of market share per co., but strongly doubt that oligopoly is keeping climbing shoe prices artificially high. As I pointed out, those prices are not historically high. And they aren't high (quite the opposite, in fact) as compared to other athletic shoes with bigger markets and production.

I have heard anecdotal evidence of the two majors muscling up on local retailers to keep out competitors. Artificial barriers to entry is one of the classic components of Econ 101 definitions of oligopoly. But there are so many other factors involved-- strength of the rep force, success of branding, etc. --that I don't have nearly enough evidence to start having to choose among the various competing theories of oligopoly, let alone apply them to measure that market impact. If you have that evidence, please share it with us.

Aside from the fact that excessive prices are predicted by economic theory, at least a few years ago before constraint of trade practices prevented Americans from buying shoes from Barrabes, Five Tens cost about half the price in Europe than they did here. Five Ten, at that time, was the distinct market leader in the US. Therefore, climbing shoe prices in the US were not determined by classic supply and demand. Prices were, and I think still are, excessive. That is why Mad Rock can and does sell shoes virtually identical to Five Ten for a fraction of the price. And don't give me this labor-intensive and workmanship crap. Both brands are produced by the cheapest labor that either company can find, and the workmanship of Five Tens is notoriously terrible. $165 for a pair of Five Tens that weaken, delaminate, and fall apart in a matter of months? Please.

Jay


k.l.k


Apr 6, 2010, 9:57 PM
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jt512 wrote:
But they are very high, compared with Europe (or at least they were a few years ago, when Americans could buy shoes from Barrabes). Why is that?

Barrabes does not = "Europe." It's not entirely clear to me why Barrabes was able to undercut everyone on basically everything (although I have some guesses). It didn't reflect what I saw at the same time (2000) in retail outlets in France, for instance.

If you are really worried about out-of-control margins in outdoor gear, climbing shoes are not the place to look. Flip-flops, for example, are a much better example. Still more obvious is fleece and plastic underwear.


Partner cracklover


Apr 6, 2010, 10:11 PM
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jt512 wrote:
and the workmanship of Five Tens is notoriously terrible.

Perhaps in your circle, but that is far from universal. And I'm not an apologist for Five Ten, I've owned poorly designed shoes, and poorly constructed shoes, from a number of different brands, Five Ten included.

GO


k.l.k


Apr 6, 2010, 10:13 PM
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jt512 wrote:
k.l.k wrote:
jt512 wrote:
Of those brands, only Five Ten, Sportiva, Evolv, MadRock, and maybe Boreal have significant market shares in the US (who has even heard of Millet and Pillar?). So, you have four or five companies in the market, of which one or two—Five Ten and maybe Sportiva—are market leaders. That's not classic free market competition; it's an oligopoly.

I don't have a reliable breakdown of market share per co., but strongly doubt that oligopoly is keeping climbing shoe prices artificially high. As I pointed out, those prices are not historically high. And they aren't high (quite the opposite, in fact) as compared to other athletic shoes with bigger markets and production.

I have heard anecdotal evidence of the two majors muscling up on local retailers to keep out competitors. Artificial barriers to entry is one of the classic components of Econ 101 definitions of oligopoly. But there are so many other factors involved-- strength of the rep force, success of branding, etc. --that I don't have nearly enough evidence to start having to choose among the various competing theories of oligopoly, let alone apply them to measure that market impact. If you have that evidence, please share it with us.

Aside from the fact that excessive prices are predicted by economic theory, at least a few years ago before constraint of trade practices prevented Americans from buying shoes from Barrabes, Five Tens cost about half the price in Europe than they did here.

According to yr Econ 101 model of oligopoly, that couldn't have happened, since the European market was at least as oligopolistic as the US one during those years.

One of the reasons 5.10 could compete so effectively with Sportiva in the US is that many of us felt that the rubber on the 5.10s was vastly better than the rubber on the Sportivas. Now I wouldn't be surprised to learn that the margins at 5.10 are higher than those at Sportiva, just as I wouldn't be surprised to learn that Sportiva enjoys a more active sponsorship from the state.

Although I think I better understand yr argument now-- you're mainly unhappy with 5.10 for charging the same price for its top-end models as the "better-made" Sportivas?

If I were to bet, I'd bet that Sportiva has its highest margins on its cheapest shoes. I'd bet that Sportiva makes less on the Testarossa or the TC Pro than on any of its beginner shoes.


jt512


Apr 6, 2010, 10:29 PM
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cracklover wrote:
jt512 wrote:
and the workmanship of Five Tens is notoriously terrible.

Perhaps in your circle, but that is far from universal. And I'm not an apologist for Five Ten, I've owned poorly designed shoes, and poorly constructed shoes, from a number of different brands, Five Ten included.

GO

The workmanship of Five Tens is horrible. That that may not be common knowledge in your circle doesn't improve the workmanship.

Jay


(This post was edited by jt512 on Apr 6, 2010, 10:30 PM)


jt512


Apr 6, 2010, 10:37 PM
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k.l.k wrote:
jt512 wrote:
k.l.k wrote:
jt512 wrote:
Of those brands, only Five Ten, Sportiva, Evolv, MadRock, and maybe Boreal have significant market shares in the US (who has even heard of Millet and Pillar?). So, you have four or five companies in the market, of which one or two—Five Ten and maybe Sportiva—are market leaders. That's not classic free market competition; it's an oligopoly.

I don't have a reliable breakdown of market share per co., but strongly doubt that oligopoly is keeping climbing shoe prices artificially high. As I pointed out, those prices are not historically high. And they aren't high (quite the opposite, in fact) as compared to other athletic shoes with bigger markets and production.

I have heard anecdotal evidence of the two majors muscling up on local retailers to keep out competitors. Artificial barriers to entry is one of the classic components of Econ 101 definitions of oligopoly. But there are so many other factors involved-- strength of the rep force, success of branding, etc. --that I don't have nearly enough evidence to start having to choose among the various competing theories of oligopoly, let alone apply them to measure that market impact. If you have that evidence, please share it with us.

Aside from the fact that excessive prices are predicted by economic theory, at least a few years ago before constraint of trade practices prevented Americans from buying shoes from Barrabes, Five Tens cost about half the price in Europe than they did here.

According to yr Econ 101 model of oligopoly, that couldn't have happened, since the European market was at least as oligopolistic as the US one during those years.

Whatever that means.

In reply to:
Although I think I better understand yr argument now-- you're mainly unhappy with 5.10 for charging the same price for its top-end models as the "better-made" Sportivas?

I'm not pissed off at anybody. I don't pay retail for my shoes, so it's not my problem. However, I think the whole US climbing shoe market has been one big rip-off. Again, Barrabes—even if they weren't representative of Europe. What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay


k.l.k


Apr 6, 2010, 10:46 PM
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jt512 wrote:
k.l.k wrote:
jt512 wrote:
k.l.k wrote:
jt512 wrote:
Of those brands, only Five Ten, Sportiva, Evolv, MadRock, and maybe Boreal have significant market shares in the US (who has even heard of Millet and Pillar?). So, you have four or five companies in the market, of which one or two—Five Ten and maybe Sportiva—are market leaders. That's not classic free market competition; it's an oligopoly.

I don't have a reliable breakdown of market share per co., but strongly doubt that oligopoly is keeping climbing shoe prices artificially high. As I pointed out, those prices are not historically high. And they aren't high (quite the opposite, in fact) as compared to other athletic shoes with bigger markets and production.

I have heard anecdotal evidence of the two majors muscling up on local retailers to keep out competitors. Artificial barriers to entry is one of the classic components of Econ 101 definitions of oligopoly. But there are so many other factors involved-- strength of the rep force, success of branding, etc. --that I don't have nearly enough evidence to start having to choose among the various competing theories of oligopoly, let alone apply them to measure that market impact. If you have that evidence, please share it with us.

Aside from the fact that excessive prices are predicted by economic theory, at least a few years ago before constraint of trade practices prevented Americans from buying shoes from Barrabes, Five Tens cost about half the price in Europe than they did here.

According to yr Econ 101 model of oligopoly, that couldn't have happened, since the European market was at least as oligopolistic as the US one during those years.

Whatever that means.

In reply to:
Although I think I better understand yr argument now-- you're mainly unhappy with 5.10 for charging the same price for its top-end models as the "better-made" Sportivas?

I'm not pissed off at anybody. I don't pay retail for my shoes, so it's not my problem. However, I think the whole US climbing shoe market has been one big rip-off. Again, Barrabes—even if they weren't representative of Europe. What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

My Testarossas? No way!

Moccasyms? Maybe. They're really simple, have been in production a long time, and have had good numbers by industry standards. But I'd bet still a lot more per unit than a pr of Sanuks or Tevas, let alone an average Saucony running shoe that retails for more dough.


curt


Apr 6, 2010, 10:55 PM
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jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.

Curt


jt512


Apr 6, 2010, 11:00 PM
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curt wrote:
jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.

Curt

But who pays retail for Nikes? Certainly no one in "my circle." ;)

Jay


caughtinside


Apr 6, 2010, 11:06 PM
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curt wrote:
jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.

Curt

regardless of the actual materials cost, I don't think anyone is getting rich in the climbing shoe business.

And I've had issues with the much vaunted by jay sportiva quality, and have had 5.10s which held up great.

There are a lot of players... but not all of them seem to want in the US market. BD used to distribute Scarpas (my current brand of choice, excellent workmanship through 3 pairs so far) but they tried to up the distribution fees and scarpa cancelled instead, trying to set up their own US distribution company and network. So far, it doesn't seem to have taken hold too well, although I do see Scarpas at more and more retailers.

Don't see many mammut shoes, surprising since the brand is so popular with their ropes and to a lesser extent the clothing.


k.l.k


Apr 6, 2010, 11:08 PM
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curt wrote:
jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.


You really believe that a Nike running shoe with an injection-molded sole, produced in high volume runs, costs the same per/unit as a TC Pro or a Testarossa?


curt


Apr 6, 2010, 11:11 PM
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k.l.k wrote:
curt wrote:
jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.


You really believe that a Nike running shoe with an injection-molded sole, produced in high volume runs, costs the same per/unit as a TC Pro or a Testarossa?

I think a Nike running shoe that sells for around $100 here in the US probably costs about the same to manufacture as, say, the Sportiva Nago--which is made in China and also sells here for $100.

Curt


k.l.k


Apr 6, 2010, 11:38 PM
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curt wrote:
k.l.k wrote:
curt wrote:
jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.


You really believe that a Nike running shoe with an injection-molded sole, produced in high volume runs, costs the same per/unit as a TC Pro or a Testarossa?

I think a Nike running shoe that sells for around $100 here in the US probably costs about the same to manufacture as, say, the Sportiva Nago--which is made in China and also sells here for $100.

That would mean that there are no longer economies of scale at work in sourcing and production.


johnwesely


Apr 6, 2010, 11:54 PM
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k.l.k wrote:
curt wrote:
k.l.k wrote:
curt wrote:
jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.


You really believe that a Nike running shoe with an injection-molded sole, produced in high volume runs, costs the same per/unit as a TC Pro or a Testarossa?

I think a Nike running shoe that sells for around $100 here in the US probably costs about the same to manufacture as, say, the Sportiva Nago--which is made in China and also sells here for $100.

That would mean that there are no longer economies of scale at work in sourcing and production.

I think you are splitting hairs and trying to be difficult. Curt's point stands even if the numbers are not exactly the same.


k.l.k


Apr 7, 2010, 12:10 AM
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johnwesely wrote:
k.l.k wrote:
curt wrote:
k.l.k wrote:
curt wrote:
jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.


You really believe that a Nike running shoe with an injection-molded sole, produced in high volume runs, costs the same per/unit as a TC Pro or a Testarossa?

I think a Nike running shoe that sells for around $100 here in the US probably costs about the same to manufacture as, say, the Sportiva Nago--which is made in China and also sells here for $100.

That would mean that there are no longer economies of scale at work in sourcing and production.

I think you are splitting hairs and trying to be difficult. Curt's point stands even if the numbers are not exactly the same.

Curt's point was that the shoes cost the same to produce-- I haven't yet seen him make Jay's argument that an oligopoly is fixing prices to make climbing shoes far more expensive than they ought to be.

Historically, labor has been the major cost of shoe production, since almost all of them are still made by hand. That means that is indeed possible-- surprising, but barely possible --that the difference of scale between a Nike production run of Zooms and Sportiva's run of Nagos would result in similar per unit cost.

But the labor also makes it less likely that you could see similar parallels for a highly involved pattern like the Testarossa and an Equalon or whatever it is that swoosh now cranks out.


johnwesely


Apr 7, 2010, 12:19 AM
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k.l.k wrote:
Curt's point was that the shoes cost the same to produce-- I haven't yet seen him make Jay's argument that an oligopoly is fixing prices to make climbing shoes far more expensive than they ought to be.

Curt's point, correct me if I am wrong, was that climbing shoes, as well as other shoes, are sold for far more than they cost to produce.


k.l.k


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johnwesely wrote:
k.l.k wrote:
Curt's point was that the shoes cost the same to produce-- I haven't yet seen him make Jay's argument that an oligopoly is fixing prices to make climbing shoes far more expensive than they ought to be.

Curt's point, correct me if I am wrong, was that climbing shoes, as well as other shoes, are sold for far more than they cost to produce.

I doubt that was his point-- everything is sold for far more than it costs to produce, with a few notable exceptions. I've known Curt for many years, and he can say some foolish stuff (for instance, i've heard him say many objectionable things about mantles and wide cracks), but he doesn't usually waste a lot of time on banalities.


(This post was edited by k.l.k on Apr 7, 2010, 12:25 AM)


johnwesely


Apr 7, 2010, 12:29 AM
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Re: [k.l.k] ClimbX [In reply to]
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k.l.k wrote:
johnwesely wrote:
k.l.k wrote:
Curt's point was that the shoes cost the same to produce-- I haven't yet seen him make Jay's argument that an oligopoly is fixing prices to make climbing shoes far more expensive than they ought to be.

Curt's point, correct me if I am wrong, was that climbing shoes, as well as other shoes, are sold for far more than they cost to produce.

I doubt that was his point-- everything is sold for far more than it costs to produce, with a few notable exceptions. I've known Curt for many years, and he can say some foolish stuff (for instance, i've heard him say many objectionable things about mantles and wide cracks), but he doesn't usually waste a lot of time on banalities.

I guess we just have to wait.


curt


Apr 7, 2010, 1:55 AM
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Re: [k.l.k] ClimbX [In reply to]
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k.l.k wrote:
curt wrote:
k.l.k wrote:
curt wrote:
jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.


You really believe that a Nike running shoe with an injection-molded sole, produced in high volume runs, costs the same per/unit as a TC Pro or a Testarossa?

I think a Nike running shoe that sells for around $100 here in the US probably costs about the same to manufacture as, say, the Sportiva Nago--which is made in China and also sells here for $100.

That would mean that there are no longer economies of scale at work in sourcing and production.

Not necessarily. There are fixed costs and variable costs involved in making the shoes and the fixed costs are much higher for each of Nike's factories--because (I'm willing to bet) they are much larger factories. That's OK though--because their volumes are much higher. The variable costs scale with production, but I still bet the per-shoe labor cost and cost of materials going into each Nago or $100 Nike running shoe are more or less the same.

By the way, which company (Nike or Sportiva) do you think has a higher cost of marketing?

Curt


curt


Apr 7, 2010, 2:04 AM
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k.l.k wrote:
johnwesely wrote:
k.l.k wrote:
curt wrote:
k.l.k wrote:
curt wrote:
jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.


You really believe that a Nike running shoe with an injection-molded sole, produced in high volume runs, costs the same per/unit as a TC Pro or a Testarossa?

I think a Nike running shoe that sells for around $100 here in the US probably costs about the same to manufacture as, say, the Sportiva Nago--which is made in China and also sells here for $100.

That would mean that there are no longer economies of scale at work in sourcing and production.

I think you are splitting hairs and trying to be difficult. Curt's point stands even if the numbers are not exactly the same.

Curt's point was that the shoes cost the same to produce-- I haven't yet seen him make Jay's argument that an oligopoly is fixing prices to make climbing shoes far more expensive than they ought to be...

I don't agree with Jay that there is price fixing--and I think simple supply and demand is explanation enough. The climbing shoe companies are merely trying to maximize profit within the constraints of the available market. They have figured out that climbers in the U.S., for example, are fully willing to pay $100 (+/- $30, say) for each pair of climbing shoes they buy. Unlike Nike, the market for climbing shoes is fairly inelastic, so they need to maximize profit on a relatively small volume--hence a relatively high price.

Curt


guangzhou


Apr 7, 2010, 2:58 AM
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Re: [jt512] ClimbX [In reply to]
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jt512 wrote:

A post merely asking for evidence gets one star. Only on rockclimbing.com

Jay

Evidence that they are a cheaper shoe? The pricetag.
That was an intelligent comment. You seem to be having trouble understanding your own statement.

In reply to:
Now, as for my implication that they are a CRAPPY shoe? That is merely my opinion, but an opinion based on trying two of their models, the Mugen and the Flash. They did not perform nearly as well as other shoes I have tried. Compared to La Sportiva, which I wear pretty much exclusively now, they fell FAR short.

Not exactly specific, but anyway, the reason behind my question (which, as usual, I have to explain to you), is that climbing shoes in the US are overpriced, either because of imperfect competition or, less likely, actual price fixing. To see this, compare prices for the exact same shoes in Europe. Thus the fact that Mad Rocks have a lower retail price than their competitors (in the US) does not imply that the shoes are lower in quality; they may just not be going along with the price structure in the market.

In reply to:
As for the one star, it seems you are attracting a lot of those....

What? Blueyedclimber missed the point of a comment? Stop the presses!

Jay
Shoes are more expensive in the U.S. because labor cost are higher. From the shipping of product across the country, to the sales person in the store, retail expenses are higher.


sidepull


Apr 7, 2010, 3:40 AM
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Re: [curt] ClimbX [In reply to]
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curt wrote:
k.l.k wrote:
johnwesely wrote:
k.l.k wrote:
curt wrote:
k.l.k wrote:
curt wrote:
jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.


You really believe that a Nike running shoe with an injection-molded sole, produced in high volume runs, costs the same per/unit as a TC Pro or a Testarossa?

I think a Nike running shoe that sells for around $100 here in the US probably costs about the same to manufacture as, say, the Sportiva Nago--which is made in China and also sells here for $100.

That would mean that there are no longer economies of scale at work in sourcing and production.

I think you are splitting hairs and trying to be difficult. Curt's point stands even if the numbers are not exactly the same.

Curt's point was that the shoes cost the same to produce-- I haven't yet seen him make Jay's argument that an oligopoly is fixing prices to make climbing shoes far more expensive than they ought to be...

I don't agree with Jay that there is price fixing--and I think simple supply and demand is explanation enough. The climbing shoe companies are merely trying to maximize profit within the constraints of the available market. They have figured out that climbers in the U.S., for example, are fully willing to pay $100 (+/- $30, say) for each pair of climbing shoes they buy. Unlike Nike, the market for climbing shoes is fairly inelastic, so they need to maximize profit on a relatively small volume--hence a relatively high price.

Curt

Huh? Dirtbag culture at its roots and climbers are inelastic about the cost of their shoes?

Sorry but, I'll agree with two people that seem to disagree:

1) Nike does have huge economies of scale (they are able to charge premiums because of their advertising so the two value of their brand more than cancels out the variable cost of advertising).

2) Jay is likely right about the oligopoly. I haven't seen a convincing argument in this thread to blow that idea away. Indeed, going back to his Barrabes example (a site a loved for too short a time), the shoe companies put the hammer down on them for selling at low European prices to the US. Easy example of the market leaders "colluding" to maintain their price points. I'm not saying it's that easy, or that's the only argument, but so far it's the best.


guangzhou


Apr 7, 2010, 4:13 AM
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Re: [sidepull] ClimbX [In reply to]
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sidepull wrote:
curt wrote:
k.l.k wrote:
johnwesely wrote:
k.l.k wrote:
curt wrote:
k.l.k wrote:
curt wrote:
jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.


You really believe that a Nike running shoe with an injection-molded sole, produced in high volume runs, costs the same per/unit as a TC Pro or a Testarossa?

I think a Nike running shoe that sells for around $100 here in the US probably costs about the same to manufacture as, say, the Sportiva Nago--which is made in China and also sells here for $100.

That would mean that there are no longer economies of scale at work in sourcing and production.

I think you are splitting hairs and trying to be difficult. Curt's point stands even if the numbers are not exactly the same.

Curt's point was that the shoes cost the same to produce-- I haven't yet seen him make Jay's argument that an oligopoly is fixing prices to make climbing shoes far more expensive than they ought to be...

I don't agree with Jay that there is price fixing--and I think simple supply and demand is explanation enough. The climbing shoe companies are merely trying to maximize profit within the constraints of the available market. They have figured out that climbers in the U.S., for example, are fully willing to pay $100 (+/- $30, say) for each pair of climbing shoes they buy. Unlike Nike, the market for climbing shoes is fairly inelastic, so they need to maximize profit on a relatively small volume--hence a relatively high price.

Curt

Huh? Dirtbag culture at its roots and climbers are inelastic about the cost of their shoes?

Sorry but, I'll agree with two people that seem to disagree:

1) Nike does have huge economies of scale (they are able to charge premiums because of their advertising so the two value of their brand more than cancels out the variable cost of advertising).

2) Jay is likely right about the oligopoly. I haven't seen a convincing argument in this thread to blow that idea away. Indeed, going back to his Barrabes example (a site a loved for too short a time), the shoe companies put the hammer down on them for selling at low European prices to the US. Easy example of the market leaders "colluding" to maintain their price points. I'm not saying it's that easy, or that's the only argument, but so far it's the best.

I still buy from Barrabes, but the Euro is strong right now, so not that much better price wise. http://tiny.cc/z9erm


jt512


Apr 7, 2010, 4:34 AM
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curt wrote:
k.l.k wrote:
johnwesely wrote:
k.l.k wrote:
curt wrote:
k.l.k wrote:
curt wrote:
jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.


You really believe that a Nike running shoe with an injection-molded sole, produced in high volume runs, costs the same per/unit as a TC Pro or a Testarossa?

I think a Nike running shoe that sells for around $100 here in the US probably costs about the same to manufacture as, say, the Sportiva Nago--which is made in China and also sells here for $100.

That would mean that there are no longer economies of scale at work in sourcing and production.

I think you are splitting hairs and trying to be difficult. Curt's point stands even if the numbers are not exactly the same.

Curt's point was that the shoes cost the same to produce-- I haven't yet seen him make Jay's argument that an oligopoly is fixing prices to make climbing shoes far more expensive than they ought to be...

I don't agree with Jay that there is price fixing

Actually, I said that it was unlikely that there was price fixing. Rather, I think that oligopoly economics is at work, where the price is largely set by the economics of the market share leader, and that price is essentially met by the other suppliers; that is, except for Mad Rock.

In reply to:
--and I think simple supply and demand is explanation enough.

If by "simple supply and demand" you mean the classic Econ 101 free market version, then no way. The US climbing shoe market doesn't even remotely resemble such a market. Go down the list of assumptions that underly the classic supply and demand model. I think you'll see that virtually every one is severely violated. In contrast, the climbing shoe market has a pretty classic oligopoly structure. Hence, I would expect oligopoly economics to apply.

Jay


curt


Apr 7, 2010, 5:23 AM
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jt512 wrote:
curt wrote:
k.l.k wrote:
johnwesely wrote:
k.l.k wrote:
curt wrote:
k.l.k wrote:
curt wrote:
jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.


You really believe that a Nike running shoe with an injection-molded sole, produced in high volume runs, costs the same per/unit as a TC Pro or a Testarossa?

I think a Nike running shoe that sells for around $100 here in the US probably costs about the same to manufacture as, say, the Sportiva Nago--which is made in China and also sells here for $100.

That would mean that there are no longer economies of scale at work in sourcing and production.

I think you are splitting hairs and trying to be difficult. Curt's point stands even if the numbers are not exactly the same.

Curt's point was that the shoes cost the same to produce-- I haven't yet seen him make Jay's argument that an oligopoly is fixing prices to make climbing shoes far more expensive than they ought to be...

I don't agree with Jay that there is price fixing

Actually, I said that it was unlikely that there was price fixing. Rather, I think that oligopoly economics is at work, where the price is largely set by the economics of the market share leader, and that price is essentially met by the other suppliers; that is, except for Mad Rock.

In reply to:
--and I think simple supply and demand is explanation enough.

If by "simple supply and demand" you mean the classic Econ 101 free market version, then no way. The US climbing shoe market doesn't even remotely resemble such a market. Go down the list of assumptions that underly the classic supply and demand model. I think you'll see that virtually every one is severely violated. In contrast, the climbing shoe market has a pretty classic oligopoly structure. Hence, I would expect oligopoly economics to apply.

Jay

Nice job of selective quoting. Pat yourself on the back for ignoring my main points.

Curt


jt512


Apr 7, 2010, 5:32 AM
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curt wrote:
jt512 wrote:
curt wrote:
k.l.k wrote:
johnwesely wrote:
k.l.k wrote:
curt wrote:
k.l.k wrote:
curt wrote:
jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.


You really believe that a Nike running shoe with an injection-molded sole, produced in high volume runs, costs the same per/unit as a TC Pro or a Testarossa?

I think a Nike running shoe that sells for around $100 here in the US probably costs about the same to manufacture as, say, the Sportiva Nago--which is made in China and also sells here for $100.

That would mean that there are no longer economies of scale at work in sourcing and production.

I think you are splitting hairs and trying to be difficult. Curt's point stands even if the numbers are not exactly the same.

Curt's point was that the shoes cost the same to produce-- I haven't yet seen him make Jay's argument that an oligopoly is fixing prices to make climbing shoes far more expensive than they ought to be...

I don't agree with Jay that there is price fixing

Actually, I said that it was unlikely that there was price fixing. Rather, I think that oligopoly economics is at work, where the price is largely set by the economics of the market share leader, and that price is essentially met by the other suppliers; that is, except for Mad Rock.

In reply to:
--and I think simple supply and demand is explanation enough.

If by "simple supply and demand" you mean the classic Econ 101 free market version, then no way. The US climbing shoe market doesn't even remotely resemble such a market. Go down the list of assumptions that underly the classic supply and demand model. I think you'll see that virtually every one is severely violated. In contrast, the climbing shoe market has a pretty classic oligopoly structure. Hence, I would expect oligopoly economics to apply.

Jay

Nice job of selective quoting. Pat yourself on the back for ignoring my main points.

Curt

Um, first of all, I wasn't aware of any official compulsion to comment on a poster's main points, especially when the poster misrepresented my own point. That said, based on the structure of your paragraph, one would think that your main point was that "simple supply and demand is explanation enough" with the rest of your paragraph elaborating on that. And I did comment on that, even though, as I said, there is no compelling rule to do so.

Jay


curt


Apr 7, 2010, 5:38 AM
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Re: [jt512] ClimbX [In reply to]
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jt512 wrote:
curt wrote:
jt512 wrote:
curt wrote:
k.l.k wrote:
johnwesely wrote:
k.l.k wrote:
curt wrote:
k.l.k wrote:
curt wrote:
jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.


You really believe that a Nike running shoe with an injection-molded sole, produced in high volume runs, costs the same per/unit as a TC Pro or a Testarossa?

I think a Nike running shoe that sells for around $100 here in the US probably costs about the same to manufacture as, say, the Sportiva Nago--which is made in China and also sells here for $100.

That would mean that there are no longer economies of scale at work in sourcing and production.

I think you are splitting hairs and trying to be difficult. Curt's point stands even if the numbers are not exactly the same.

Curt's point was that the shoes cost the same to produce-- I haven't yet seen him make Jay's argument that an oligopoly is fixing prices to make climbing shoes far more expensive than they ought to be...

I don't agree with Jay that there is price fixing

Actually, I said that it was unlikely that there was price fixing. Rather, I think that oligopoly economics is at work, where the price is largely set by the economics of the market share leader, and that price is essentially met by the other suppliers; that is, except for Mad Rock.

In reply to:
--and I think simple supply and demand is explanation enough.

If by "simple supply and demand" you mean the classic Econ 101 free market version, then no way. The US climbing shoe market doesn't even remotely resemble such a market. Go down the list of assumptions that underly the classic supply and demand model. I think you'll see that virtually every one is severely violated. In contrast, the climbing shoe market has a pretty classic oligopoly structure. Hence, I would expect oligopoly economics to apply.

Jay

Nice job of selective quoting. Pat yourself on the back for ignoring my main points.

Curt

Um, first of all, I wasn't aware of any official compulsion to comment on a poster's main points...

Jay

No. Not if straw man arguments are what you desire to engage in. In any event, if you think that there is collusion in pricing or that some sort of cartel has been formed in the U.S. climbing shoe market (classic behaviors of oligopolies) then I think you're just a bit paranoid.

Curt


(This post was edited by curt on Apr 7, 2010, 5:46 AM)


jt512


Apr 7, 2010, 5:54 AM
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curt wrote:
jt512 wrote:
curt wrote:
jt512 wrote:
curt wrote:
k.l.k wrote:
johnwesely wrote:
k.l.k wrote:
curt wrote:
k.l.k wrote:
curt wrote:
jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.


You really believe that a Nike running shoe with an injection-molded sole, produced in high volume runs, costs the same per/unit as a TC Pro or a Testarossa?

I think a Nike running shoe that sells for around $100 here in the US probably costs about the same to manufacture as, say, the Sportiva Nago--which is made in China and also sells here for $100.

That would mean that there are no longer economies of scale at work in sourcing and production.

I think you are splitting hairs and trying to be difficult. Curt's point stands even if the numbers are not exactly the same.

Curt's point was that the shoes cost the same to produce-- I haven't yet seen him make Jay's argument that an oligopoly is fixing prices to make climbing shoes far more expensive than they ought to be...

I don't agree with Jay that there is price fixing

Actually, I said that it was unlikely that there was price fixing. Rather, I think that oligopoly economics is at work, where the price is largely set by the economics of the market share leader, and that price is essentially met by the other suppliers; that is, except for Mad Rock.

In reply to:
--and I think simple supply and demand is explanation enough.

If by "simple supply and demand" you mean the classic Econ 101 free market version, then no way. The US climbing shoe market doesn't even remotely resemble such a market. Go down the list of assumptions that underly the classic supply and demand model. I think you'll see that virtually every one is severely violated. In contrast, the climbing shoe market has a pretty classic oligopoly structure. Hence, I would expect oligopoly economics to apply.

Jay

Nice job of selective quoting. Pat yourself on the back for ignoring my main points.

Curt

Um, first of all, I wasn't aware of any official compulsion to comment on a poster's main points...

Jay

No. Not if straw man arguments are what you desire to engage in. In any event, if you think that there is collusion in pricing or that some sort of cartel has been formed in the U.S. climbing shoe market (classic behaviors of oligopolies) then I think you're just a bit paranoid.

Curt

Who is the one making the straw man argument?

Jay


davidnn5


Apr 7, 2010, 7:12 AM
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Hell - a place in which it is impossible to quote quotes of quoted quotes, and equally impossible to prove you're right.


I_do


Apr 7, 2010, 8:50 AM
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Just to get it out of y'alls head, climbing shoes are a LOT more expensive in Europe than they are in america.


sbaclimber


Apr 7, 2010, 10:51 AM
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I_do wrote:
Just to get it out of y'alls head, climbing shoes are a LOT more expensive in Europe than they are in america.
Not sure where you're shopping, but with the current exchange rate I don't see much difference...
e.g. La Sportiva Mythos
Europe
Europe
USA
USA

....5.10 Verdes are a bit pricier, but not that extreme
Europe
Europe
USA
USA

BTW, my last 2 pairs of shoes I bought were a pair of 5.10 Pitons and a pair of Mammuts.
The Pitons I ordered from the states after checking directly with 5.10 Europe, who told me they wouldn't be stocking them here. I think the price turned out to be (after import tax Frown) about what retail would've been here anyway, if they had been available.
The Mammuts I bought 'cause they were on sale for 60€ Cool I think they retailed for 70-80€ though, which is still pretty reasonable.......for climbing shoes.


(This post was edited by sbaclimber on Apr 7, 2010, 10:59 AM)


I_do


Apr 7, 2010, 11:11 AM
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sbaclimber wrote:
I_do wrote:
Just to get it out of y'alls head, climbing shoes are a LOT more expensive in Europe than they are in america.
Not sure where you're shopping, but with the current exchange rate I don't see much difference...
e.g. La Sportiva Mythos
Europe
Europe
USA
USA

....5.10 Verdes are a bit pricier, but not that extreme
Europe
Europe
USA
USA

BTW, my last 2 pairs of shoes I bought were a pair of 5.10 Pitons and a pair of Mammuts.
The Pitons I ordered from the states after checking directly with 5.10 Europe, who told me they wouldn't be stocking them here. I think the price turned out to be (after import tax Frown) about what retail would've been here anyway, if they had been available.
The Mammuts I bought 'cause they were on sale for 60€ Cool I think they retailed for 70-80€ though, which is still pretty reasonable.......for climbing shoes.

I looked at some other shoes at mnttools.com and prices are indeed really similar.

I stand corrected and shizz


xaniel2000


Apr 7, 2010, 1:53 PM
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k.l.k wrote:
btw, for what it's worth, i'm all for the original factory in china continuing on making shoes, keeping their employees employed, and having that shoe-making skill conserved rather than disappear.

so good luck to climbx.

That's a good point, I hadn't thought of that. But I still don't like this ClimbX group, because it seems that they're essentially copycatting the same designs and undercutting Mad Rock by $10 a shoe. It makes the whole venture feel a bit scummy.

If they had kept the same factory but produced a whole new set of designs, then it'd be another story, but apparently they're not prepared (or capitalized) for a redesign of the brand, so they're proceeding with this obvious infringement. And this business plan is clearly aimed at Mad Rock's share of the market, producing the same products for a few dollars less, almost as if it were a vendetta against Mad Rock by Joe Garland.


curt


Apr 7, 2010, 5:02 PM
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jt512 wrote:
curt wrote:

No. Not if straw man arguments are what you desire to engage in. In any event, if you think that there is collusion in pricing or that some sort of cartel has been formed in the U.S. climbing shoe market (classic behaviors of oligopolies) then I think you're just a bit paranoid.

Curt

Who is the one making the straw man argument?

Jay

Well, considering that your main point has been that "imperfect competition" caused by a few large competitors in the US climbing shoe market has kept prices artificially high, I'd say that comment of mine was right on point.

Curt


k.l.k


Apr 7, 2010, 5:26 PM
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curt wrote:
k.l.k wrote:
curt wrote:
k.l.k wrote:
curt wrote:
jt512 wrote:
...What do you think the direct labor and materials cost of a pair of climbing shoes is? Ten dollars? Five dollars?

Jay

Maybe $10--about the same as for a Nike running shoe that would sell for $100.00 here.


You really believe that a Nike running shoe with an injection-molded sole, produced in high volume runs, costs the same per/unit as a TC Pro or a Testarossa?

I think a Nike running shoe that sells for around $100 here in the US probably costs about the same to manufacture as, say, the Sportiva Nago--which is made in China and also sells here for $100.

That would mean that there are no longer economies of scale at work in sourcing and production.

Not necessarily. There are fixed costs and variable costs involved in making the shoes and the fixed costs are much higher for each of Nike's factories--because (I'm willing to bet) they are much larger factories. That's OK though--because their volumes are much higher. The variable costs scale with production, but I still bet the per-shoe labor cost and cost of materials going into each Nago or $100 Nike running shoe are more or less the same.

By the way, which company (Nike or Sportiva) do you think has a higher cost of marketing?

So I did some quick research last night-- not real research, google, some phone calls, good enough for b-school (heh) --and what I am hearing is about what you'd expect if we actually look at the shoes-- climbing shoes typically run significantly higher line costs (and lower margins) than approach shoes or running shoes.

My Testarossas have at least 12 separate pieces in the upper; at least 20 seams. Each of those seams has to be sewed under tension; then a mid-sole, sole, and tension rand are glued in by hand. Each cut and stitch not only takes time, but also offers a good chance for a mistake.

My old New Balances (forget the model, but about the same price as the Sporties when I bought them), have a two piece upper, bad stitching, random decorative crap tacked onto the outside, and an injection-molded sole. I bet the Sporties took half-again as much time on the line to make and required a much higher level of skill.

You're right about the marketing-- I bet design, sourcing and manufacture are close to negligible chunks of Nike's budget-- they are basically nothing but a brand marketer.

There are certainly model-to-model variations. But you are generally getting more for your money with a well-made pair of climbing shoes than with a typical runner at the same pricepoint.


k.l.k


Apr 7, 2010, 5:41 PM
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sidepull wrote:
. . . going back to his Barrabes example (a site a loved for too short a time), the shoe companies put the hammer down on them for selling at low European prices to the US. Easy example of the market leaders "colluding" to maintain their price points.

Actually, it isn't an "easy example."

First, Barrabes does not = "European." Barrabes is not a country in Europe. Barrabes was an early e-tailer who appears to have been undercutting other European retailers rather than offering some generic "European" price.

Second, Barrabes (or any other retailer) selling below MSRP didn't directly hurt any of the makers, just as pro deals don't hurt makers. The companies sold to Barrabes at wholesale, so their margin was the same. Barrabes was cutting the retail margin. The intervention came at the behest of the other retailers.

Third, yes, manufacturers of all kinds of goods are allowed to demand, as a condition of sale to retailers, that the retailer not advertise the goods below MSRP except under certain conditions. That's not some weird fluke of the climbing shoe market-- musical instruments, brand clothing, all sorts of consumer goods work that way.

If you want to expand the Econ 101 definition of "oligopoly" to include that aspect of consumer capitalism, then party on. But then yr (and Jay's) complaint then becomes a generic one about consumer capitalism, rather than a complaint specific to climbing shoes. And if you really want to try to persuade the courts that such traditions amount to "collusion" or "restraint of trade," good luck.


sidepull


Apr 7, 2010, 5:57 PM
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k.l.k wrote:
sidepull wrote:
. . . going back to his Barrabes example (a site a loved for too short a time), the shoe companies put the hammer down on them for selling at low European prices to the US. Easy example of the market leaders "colluding" to maintain their price points.

Actually, it isn't an "easy example."

It is, nonetheless, an example. As any of the evidence suggested in this forum, there are of course alternative explanations, the question is which one describes the majority of the variance.

k.l.k wrote:
First, Barrabes does not = "European." Barrabes is not a country in Europe. Barrabes was an early e-tailer who appears to have been undercutting other European retailers rather than offering some generic "European" price.

I think that's well understood and I don't think I implied Barrabes was a country. What I said was that they sold at European prices and, at the time of their discounts, if you indicated you were from US you got the same price as if you Spain. Once they switched, the Spanish prices stayed low and the US prices shot up. The prices stayed at the Spanish level if you noted you were from France or Italy. So it was a "European price." Perhaps that's not the case now - I haven't checked in a few years.

k.l.k wrote:
Second, Barrabes (or any other retailer) selling below MSRP didn't directly hurt any of the makers, just as pro deals don't hurt makers. The companies sold to Barrabes at wholesale, so their margin was the same. Barrabes was cutting the retail margin. The intervention came at the behest of the other retailers.

Ha ha! Pro deals work because relatively few people get them so the pro deal doesn't dilute the perceived value of the price point. When a retailer drastically cuts their margin for an extended period of time, it does hurt the maker because it suggests that the price point is ... drum roll ... artificially inflated. You're right that retailers wanted a change, but you're wrong if you assume the maker didn't care.

k.l.k wrote:
Third, yes, manufacturers of all kinds of goods are allowed to demand, as a condition of sale to retailers, that the retailer not advertise the goods below MSRP except under certain conditions. That's not some weird fluke of the climbing shoe market-- musical instruments, brand clothing, all sorts of consumer goods work that way.

If you want to expand the Econ 101 definition of "oligopoly" to include that aspect of consumer capitalism, then party on. But then yr (and Jay's) complaint then becomes a generic one about consumer capitalism, rather than a complaint specific to climbing shoes. And if you really want to try to persuade the courts that such traditions amount to "collusion" or "restraint of trade," good luck.

That's not the type of collusion I was referring to. I'm talking about competing companies agreeing to keep their prices artificially high. Obviously this extends to retailers at some level, but at that point they're simply following the demands of the type of market they are dealing with. In either definition of collusion, you're right, it would never get tried in courts - that's the beauty of this type of system, it's extremely hard to prove.

In sum, all I'm saying is that you can't ignore JT512's argument. I think you're right in point out that the margins on climbing shoes are lower that other soft goods because of the niche market and lower economies of scale but I don't think that somehow excludes oligopolies as a complimentary force. The two are not mutually exclusive.


jt512


Apr 7, 2010, 6:01 PM
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curt wrote:
jt512 wrote:
curt wrote:

No. Not if straw man arguments are what you desire to engage in. In any event, if you think that there is collusion in pricing or that some sort of cartel has been formed in the U.S. climbing shoe market (classic behaviors of oligopolies) then I think you're just a bit paranoid.

Curt

Who is the one making the straw man argument?

Jay

Well, considering that your main point has been that "imperfect competition" caused by a few large competitors in the US climbing shoe market has kept prices artificially high, I'd say that comment of mine was right on point.

Curt

It isn't on point at all. Imperfect competition does not imply collusion. It sounds like you need to read up on the subject.

Jay


curt


Apr 7, 2010, 6:05 PM
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jt512 wrote:
curt wrote:
jt512 wrote:
curt wrote:

No. Not if straw man arguments are what you desire to engage in. In any event, if you think that there is collusion in pricing or that some sort of cartel has been formed in the U.S. climbing shoe market (classic behaviors of oligopolies) then I think you're just a bit paranoid.

Curt

Who is the one making the straw man argument?

Jay

Well, considering that your main point has been that "imperfect competition" caused by a few large competitors in the US climbing shoe market has kept prices artificially high, I'd say that comment of mine was right on point.

Curt

It isn't on point at all. Imperfect competition does not imply collusion. It sounds like you need to read up on the subject.

Jay

More likely you do. This is like me trying to tell you about epidemiological statistics.

Curt


jt512


Apr 7, 2010, 6:11 PM
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curt wrote:
jt512 wrote:
curt wrote:
jt512 wrote:
curt wrote:

No. Not if straw man arguments are what you desire to engage in. In any event, if you think that there is collusion in pricing or that some sort of cartel has been formed in the U.S. climbing shoe market (classic behaviors of oligopolies) then I think you're just a bit paranoid.

Curt

Who is the one making the straw man argument?

Jay

Well, considering that your main point has been that "imperfect competition" caused by a few large competitors in the US climbing shoe market has kept prices artificially high, I'd say that comment of mine was right on point.

Curt

It isn't on point at all. Imperfect competition does not imply collusion. It sounds like you need to read up on the subject.

Jay

More likely you do. This is like me trying to tell you about epidemiological statistics.

Curt

I would have thought so, but you have repeatedly implied that oligopoly implies collusion. Since that is patently false, I can only conclude that you are ignorant of oligopoly economics.

Jay


k.l.k


Apr 7, 2010, 6:26 PM
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sidepull wrote:
. . . You're right that retailers wanted a change, but you're wrong if you assume the maker didn't care.

k.l.k wrote:
Third, yes, manufacturers of all kinds of goods are allowed to demand, as a condition of sale to retailers, that the retailer not advertise the goods below MSRP except under certain conditions. That's not some weird fluke of the climbing shoe market-- musical instruments, brand clothing, all sorts of consumer goods work that way.

If you want to expand the Econ 101 definition of "oligopoly" to include that aspect of consumer capitalism, then party on. But then yr (and Jay's) complaint then becomes a generic one about consumer capitalism, rather than a complaint specific to climbing shoes. And if you really want to try to persuade the courts that such traditions amount to "collusion" or "restraint of trade," good luck.

That's not the type of collusion I was referring to. I'm talking about competing companies agreeing to keep their prices artificially high. Obviously this extends to retailers at some level, but at that point they're simply following the demands of the type of market they are dealing with. In either definition of collusion, you're right, it would never get tried in courts - that's the beauty of this type of system, it's extremely hard to prove.

In sum, all I'm saying is that you can't ignore JT512's argument. I think you're right in point out that the margins on climbing shoes are lower that other soft goods because of the niche market and lower economies of scale but I don't think that somehow excludes oligopolies as a complimentary force. The two are not mutually exclusive.

Yes, makers care about MSRP for two different reasons: First, each brand and even model is associated with a particular pricepoint and market niche, and if you dilute it, you're screwed. Second, the outdoor industry is very small and has traditionally been built on face-to-face relationships in a small network of retailers, reps, and co. onwers/employees. E-tail and big boxes are destroying that system-- in this corner of the market, makers have had some vested interest in protecting the margins of the smalll shops from the big boxes and e-tailers. that's going away, of course, but there's going to be a real blood bath as the small indies go out of business.

But the pricepoints aren't set by climbing shoe makers-- they're handed down from the shoe industry generally. climbing shoes are an incredibly tiny slice of the athletic shoe market, which is in turn only 1/3 of all us sales-- the $100.oo break point cuts across all types of shoes.

The general pricepoints for shoe sales, including climbing shoes, are set by consumers and producers in that massive industry. Companies making labor and design-intensive sports shoes for niche markets are actually squeezed pretty hard by those pricepoints and have to either accept lower margins or try find at least a few models with high margins to support the rest of the line.

The idea that 5.10 or Sportiva could artificially set pricepoints in any significant way is not plausible. 5.10's entire gross sales last year would barely be a rounding error in the budget of Nike's marketing department.

Folks who want drastically cheaper climbing shoes-- or who think that climbing shoes ought to pretend to be their own special consumer good unrelated to larger forces in the shoe industry --basically have to hope for a lot of much more poorly made shoes and/or the complete conversion of outdoor retail to big box.

Wal-Mart here we come.

That'll show those evil oligopolists.


curt


Apr 7, 2010, 6:39 PM
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jt512 wrote:
curt wrote:
jt512 wrote:
curt wrote:
jt512 wrote:
curt wrote:

No. Not if straw man arguments are what you desire to engage in. In any event, if you think that there is collusion in pricing or that some sort of cartel has been formed in the U.S. climbing shoe market (classic behaviors of oligopolies) then I think you're just a bit paranoid.

Curt

Who is the one making the straw man argument?

Jay

Well, considering that your main point has been that "imperfect competition" caused by a few large competitors in the US climbing shoe market has kept prices artificially high, I'd say that comment of mine was right on point.

Curt

It isn't on point at all. Imperfect competition does not imply collusion. It sounds like you need to read up on the subject.

Jay

More likely you do. This is like me trying to tell you about epidemiological statistics.

Curt

I would have thought so, but you have repeatedly implied that oligopoly implies collusion. Since that is patently false, I can only conclude that you are ignorant of oligopoly economics.

Jay

No. I have never said that oligopolies necessarily collude, engage in price fixing, form cartels, etc. You are the one asserting that "imperfect competition" in the climbing shoe market in the US is being caused by "a few" large manufacturers dominating the market--and that is the definition of improper behavior on the part of an oligopoly. I personally think my earlier explanation is more accurate:

curt wrote:
..The climbing shoe companies are merely trying to maximize profit within the constraints of the available market. They have figured out that climbers in the U.S., for example, are fully willing to pay $100 (+/- $30, say) for each pair of climbing shoes they buy. Unlike Nike, the market for climbing shoes is fairly inelastic, so they need to maximize profit on a relatively small volume--hence a relatively high price...

Curt


jt512


Apr 7, 2010, 6:44 PM
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k.l.k wrote:
But the pricepoints aren't set by climbing shoe makers-- they're handed down from the shoe industry generally. climbing shoes are an incredibly tiny slice of the athletic shoe market, which is in turn only 1/3 of all us sales-- the $100.oo break point cuts across all types of shoes.

First of all, I see no evidence, and little logic, behind your theory that the prices of climbing shoes are dictated by the price of other athletic shoes. By your own admission, climbing is a niche market, and climbing shoes have essentially no substitute, and hence an inelastic demand curve.

Secondly, there is no break point of $100.00 in the climbing shoe market. Most sport climbing shoes retail for well over $100.

In reply to:
The general pricepoints for shoe sales, including climbing shoes, are set by consumers and producers in that massive industry. Companies making labor and design-intensive sports shoes for niche markets are actually squeezed pretty hard by those pricepoints and have to either accept lower margins or try find at least a few models with high margins to support the rest of the line.

The idea that 5.10 or Sportiva could artificially set pricepoints in any significant way is not plausible.

Not only is it plausible that a market leader could "set" price points. It is basically the null hypothesis, since the market is an oligopoly.

In reply to:
5.10's entire gross sales last year would barely be a rounding error in the budget of Nike's marketing department.

Which has absolutely nothing to do with anything, since climbing shoes don't compete with other athletic shoes (in any important sense in the context of this thread).

Jay


adatesman


Apr 7, 2010, 6:51 PM
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curt


Apr 7, 2010, 6:51 PM
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jt512 wrote:
...Secondly, there is no break point of $100.00 in the climbing shoe market. Most sport climbing shoes retail for well over $100...

The first part of your comment is pretty clearly false. When MadRock shoes hit the market, all climbing shoe companies scrambled to add additional price-point models at less than $100. The fact that they still sell higher priced models as well is irrelevant.

Curt


KirbyC


Apr 7, 2010, 7:00 PM
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Agreed. Now it's about who can sound more like an Econ 101 professor.

In other news:

What would happen if Pinnochio said, "my nose will grow now?"


jt512


Apr 7, 2010, 7:02 PM
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curt wrote:
No. I have never said that oligopolies necessarily collude, engage in price fixing, form cartels, etc. You are the one asserting that "imperfect competition" in the climbing shoe market in the US is being caused by "a few" large manufacturers dominating the market--and that is the definition of improper behavior on the part of an oligopoly.

No, that is not the definition of "improper behavior on the part of an oligopoly." It is simply the definition of "oligopoly."

curt wrote:
..The climbing shoe companies are merely trying to maximize profit within the constraints of the available market. They have figured out that climbers in the U.S., for example, are fully willing to pay $100 (+/- $30, say) for each pair of climbing shoes they buy. Unlike Nike, the market for climbing shoes is fairly inelastic, so they need to maximize profit on a relatively small volume--hence a relatively high price...

First of all, if the climbing shoe companies are "figuring out," in any sense, what the price should be, then you are describing the most salient feature of imperfect competition. When competition is perfect, the market sets the price. Suppliers have no influence on the price; they are "price takers," and their only decision is how much to produce, given the market price.

Secondly, with respect to oligopoly, the question is whether all climbing shoe manufacturers have done this, or whether a dominant firm, (say, Five Ten), has done this, and the other manufacturers (except Mad Rock, and maybe Evolv) have found it in their best economic interests to follow Five Ten's lead.

If you can get the mistaken idea out of your head that either imperfect competition or oligopoly implies collusion or other impropriety, I think you'll see that your explanation and mine have a lot in common.

Jay


jt512


Apr 7, 2010, 7:08 PM
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curt wrote:
jt512 wrote:
...Secondly, there is no break point of $100.00 in the climbing shoe market. Most sport climbing shoes retail for well over $100...

The first part of your comment is pretty clearly false. When MadRock shoes hit the market, all climbing shoe companies scrambled to add additional price-point models at less than $100. The fact that they still sell higher priced models as well is irrelevant.

Huh? I do not understand why the fact that the majority of climbing shoes are priced over $100 is irrelevant, especially in the context of Kerwin's claim that this is some magic number derived from the broader athletic shoe market that dictates the price of climbing shoes.

Furthermore, if it is true that other firms lowered their prices based on Mad Rock's entry into the market, then (1) that is conclusive proof of imperfect competition and (2) it strongly suggests that prices were inflated in the first place.

Jay


bustloose


Apr 7, 2010, 7:21 PM
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sometimes i lie awake at night and wonder "what would it be like to never be wrong? to gently push every argument around to the grey areas, and endlessly avoid dealing with counterpoints until god himself would say 'fine, whatever, just shut the fuck up already'"

in the original spirit of the thread, i think that the birth of ClimbX is a blemish on the climbing industry. Sure, by all means, keep a factory making shoes, but at least make it *look* like you are trying to make different shoes. This blatant duplication is sad, and i quite sincerely hope they don't survive.

to attempt to join the E-conversation, and also make a nod to the baseless speculation angle - apparently back in the day Oakley and Nike had an agreement along the lines of "we won't make sunglasses if you don't make shoes" we all know how that turned out...


k.l.k


Apr 7, 2010, 7:22 PM
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jt512 wrote:
k.l.k wrote:
But the pricepoints aren't set by climbing shoe makers-- they're handed down from the shoe industry generally. climbing shoes are an incredibly tiny slice of the athletic shoe market, which is in turn only 1/3 of all us sales-- the $100.oo break point cuts across all types of shoes.

. . . there is no break point of $100.00 in the climbing shoe market. Most sport climbing shoes retail for well over $100.

In reply to:
The general pricepoints for shoe sales, including climbing shoes, are set by consumers and producers in that massive industry. Companies making labor and design-intensive sports shoes for niche markets are actually squeezed pretty hard by those pricepoints and have to either accept lower margins or try find at least a few models with high margins to support the rest of the line.

The idea that 5.10 or Sportiva could artificially set pricepoints in any significant way is not plausible.

Not only is it plausible that a market leader could "set" price points. It is basically the null hypothesis, since the market is an oligopoly.

In reply to:
5.10's entire gross sales last year would barely be a rounding error in the budget of Nike's marketing department.

Which has absolutely nothing to do with anything, since climbing shoes don't compete with other athletic shoes (in any important sense in the context of this thread).

Every major climbing shoe maker-- including Sportiva --has a $100.00 break point. Everyone offers at least one model below that break point. It is called a break point because the industry "breaks" its consumer markets along that line. Climbing shoe makers didn't pick that line or set it.

I've spent the last several months listening to folks talk about this, and then wasted much of my evening last night reading reports that tend to say the same things over and over, namely that the entire shoe market breaks at $100.00 and then again at $200.000 (which puts most climbing shoes exactly where you'd expect, in the "bridge" segment, above Wal-Mart and Penneys but below luxury brands.) The decent reports are all sub or proprietary. But they all say pretty much the same thing. If you have an institutional sub, then you can find them if you really care.

I keep mentioning running shoes because of yr claim that climbing shoes prices are a special case of oligopoly and that the shoes ought to be much cheaper. The obvious comp is another type of athletic shoe. Running shoes are the most popular. Mid- and upper-tier running shoes break at the same price points as the climbing shoes. Even a cursory examination of comps, the knowledge of economies of scale, and anecdotal evidence all say that the climbing shoes have higher investments in line labor and lower margins (with variations from model-to-model, factory-to-factory, etc.).

Of course, any private company can run its margins down to nothing as long as the cash holds out. So yes, anyone can decide to run an even lower margin and hit a lower price point for a comparable shoe.

But everything I can hear and find says that margins in climbing shoes are lower than-- and prices equivalent to--those of comps in the dominant sectors of the athletic shoe industry. If the climbing shoe market were independent of the rest of the shoe market, and if 5.10 and Sportiva could indeed set pricepoints independent of those in other parts of the shoe industry, then a pair of Testarossas would cost a whole lot more than a pair of Equalons.

Edit for spelling


(This post was edited by k.l.k on Apr 7, 2010, 7:25 PM)


jt512


Apr 7, 2010, 7:28 PM
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k.l.k wrote:
jt512 wrote:
k.l.k wrote:
But the pricepoints aren't set by climbing shoe makers-- they're handed down from the shoe industry generally. climbing shoes are an incredibly tiny slice of the athletic shoe market, which is in turn only 1/3 of all us sales-- the $100.oo break point cuts across all types of shoes.

. . . there is no break point of $100.00 in the climbing shoe market. Most sport climbing shoes retail for well over $100.

In reply to:
The general pricepoints for shoe sales, including climbing shoes, are set by consumers and producers in that massive industry. Companies making labor and design-intensive sports shoes for niche markets are actually squeezed pretty hard by those pricepoints and have to either accept lower margins or try find at least a few models with high margins to support the rest of the line.

The idea that 5.10 or Sportiva could artificially set pricepoints in any significant way is not plausible.

Not only is it plausible that a market leader could "set" price points. It is basically the null hypothesis, since the market is an oligopoly.

In reply to:
5.10's entire gross sales last year would barely be a rounding error in the budget of Nike's marketing department.

Which has absolutely nothing to do with anything, since climbing shoes don't compete with other athletic shoes (in any important sense in the context of this thread).

Every major climbing shoe maker-- including Sportiva --has a $100.00 break point. Everyone offers at least one model below that break point. It is called a break point because the industry "breaks" its consumer markets along that line. Climbing shoe makers didn't pick that line or set it.

I misunderstood what you meant by "break point." I thought you meant that it was some sort of floor.

In reply to:
I keep mentioning running shoes because of yr claim that climbing shoes prices are a special case of oligopoly and that the shoes ought to be much cheaper.

I never said that climbing shoes were any sort of "special case." The broader athletic shoe market is also an oligopoly, resulting similarly in higher than market prices. This is obvious in the athletic shoe market by the proliferation of discount retailers.

Jay


(This post was edited by jt512 on Apr 7, 2010, 7:31 PM)


k.l.k


Apr 7, 2010, 7:32 PM
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jt512 wrote:
I misunderstood what you meant by "break point." I thought you meant that it was some sort of floor.

business has its own special vocabularies-- there's a whole, wide new intellectual world awaiting as you get deeper into breaks and skus and on and on.

apologies to my colleagues, but it's just terrifying to see what passes for scholarship in b-school, let alone industry analysis.


k.l.k


Apr 7, 2010, 8:05 PM
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jt512 wrote:
I never said that climbing shoes were any sort of "special case." The broader athletic shoe market is also an oligopoly, resulting similarly in higher than market prices. This is obvious in the athletic shoe market by the proliferation of discount retailers.

Well, athletics shoes are 1/3 of the US market, and the rest of the market also has "market leaders." So it's all oligopoly by yr definition? Ok, I guess, but if everything's an oligopoly, then nothing is. Your complaint would be a generic one about consumer capitlism. Many of us might sympathize or share your unhappiness, but I'd pick flip-flops or fleeces or something more egregious as a target.

So far as big-box discount retailers, yes, their business models allow them to trade lower margins for higher volume and still make shareholders happy. Eventually, if a decent chunk of the new Chinese middle-class decides to take up climbing, there'll be a big enough market for that sort of model to dominate our sport as well, and the prices of climbing shoes will drop. Maybe a few quality makers will survive by branding themselves as luxury climbing shoes, so there will still be a few well-crafted shoes.

But no, I'm not cheering for Wal-Mart to arrive. I'd rather let small indie climbing stores run livable margins and stay in business.


jt512


Apr 7, 2010, 8:30 PM
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k.l.k wrote:
jt512 wrote:
I never said that climbing shoes were any sort of "special case." The broader athletic shoe market is also an oligopoly, resulting similarly in higher than market prices. This is obvious in the athletic shoe market by the proliferation of discount retailers.

Well, athletics shoes are 1/3 of the US market, and the rest of the market also has "market leaders." So it's all oligopoly by yr definition?

It's "all" oligopoly by the definition of "oligopoly." Yes, there are many oligopolistic markets in the US. It is a consequence, and fundamental flaw of, unregulated free market capitalism. If capitalism worked the way it is "supposed to" in Econ 101, there wouldn't be a problem: prices would be determined by free market forces, and would be economically fair. Unfortunately, the markets for most goods and services don't work that way, with the result that suppliers make excess economic profit at the expense of consumers. This is fundamentally why there is ever-widening income disparity in the US.

Jay


(This post was edited by jt512 on Apr 7, 2010, 8:34 PM)


caughtinside


Apr 7, 2010, 9:11 PM
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jt512 wrote:
k.l.k wrote:
jt512 wrote:
I never said that climbing shoes were any sort of "special case." The broader athletic shoe market is also an oligopoly, resulting similarly in higher than market prices. This is obvious in the athletic shoe market by the proliferation of discount retailers.

Well, athletics shoes are 1/3 of the US market, and the rest of the market also has "market leaders." So it's all oligopoly by yr definition?

It's "all" oligopoly by the definition of "oligopoly." Yes, there are many oligopolistic markets in the US. It is a consequence, and fundamental flaw of, unregulated free market capitalism. If capitalism worked the way it is "supposed to" in Econ 101, there wouldn't be a problem: prices would be determined by free market forces, and would be economically fair. Unfortunately, the markets for most goods and services don't work that way, with the result that suppliers make excess economic profit at the expense of consumers. This is fundamentally why there is ever-widening income disparity in the US.

Jay

That is just fucking retarded. If every market is oligopolistic by definition of oligopoly, why didn't you just say so. Shit, even I'm tempted to give you one star for this one.


curt


Apr 7, 2010, 10:50 PM
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jt512 wrote:
curt wrote:
No. I have never said that oligopolies necessarily collude, engage in price fixing, form cartels, etc. You are the one asserting that "imperfect competition" in the climbing shoe market in the US is being caused by "a few" large manufacturers dominating the market--and that is the definition of improper behavior on the part of an oligopoly.

No, that is not the definition of "improper behavior on the part of an oligopoly." It is simply the definition of "oligopoly."

You are completely wrong about that. Oligopolies can (and do often) engage in fierce competition, resulting in low and efficient prices for consumers.

"jt512 wrote:
curt wrote:
..The climbing shoe companies are merely trying to maximize profit within the constraints of the available market. They have figured out that climbers in the U.S., for example, are fully willing to pay $100 (+/- $30, say) for each pair of climbing shoes they buy. Unlike Nike, the market for climbing shoes is fairly inelastic, so they need to maximize profit on a relatively small volume--hence a relatively high price...

First of all, if the climbing shoe companies are "figuring out," in any sense, what the price should be, then you are describing the most salient feature of imperfect competition. When competition is perfect, the market sets the price. Suppliers have no influence on the price; they are "price takers," and their only decision is how much to produce, given the market price.

That is absolute nonsense from an economic perspective. When manufacturers understand what the market will bear for their product, the balance of supply and demand has been established. The "market" setting the price involves both supply and demand. To say that suppliers "have no influence" over the price is completely ridiculous. What do you suppose would happen to pricing if every manufacturer doubled their current production levels?

jt512 wrote:
If you can get the mistaken idea out of your head that either imperfect competition or oligopoly implies collusion or other impropriety, I think you'll see that your explanation and mine have a lot in common.

You are the one who is still confused. It is clearly possible to have an oligopoly and not have the type of artificially high pricing you describe. The oligopoly must be behaving in a non-competitive (i.e. improper) way for the "imperfect competition" to occur.

Curt


curt


Apr 7, 2010, 10:57 PM
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jt512 wrote:
Furthermore, if it is true that other firms lowered their prices based on Mad Rock's entry into the market, then (1) that is conclusive proof of imperfect competition...

You clearly need to revisit Macro Economics 101. Other climbing shoe companies lowering their pricing in response to MadRock's market entry proves nothing of the kind. Supply and demand curves ALWAYS reset to a new level when competition either enters or leaves a market.

Curt


edge


Apr 7, 2010, 11:10 PM
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Since I foresee this discussion continuing for 7 more pages, I will now demonstrate how to tie a middle mark in a thread.

After page 14, however, I will tie the thread behind a moving boat and tow it to wash out the dirt and get the kinks out. It should be reduced to about 4 or 5 posts at that time.

Please proceed with your regularly scheduled programming.


jt512


Apr 8, 2010, 1:21 AM
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curt wrote:
jt512 wrote:
Furthermore, if it is true that other firms lowered their prices based on Mad Rock's entry into the market, then (1) that is conclusive proof of imperfect competition...

You clearly need to revisit Macro Economics 101. Other climbing shoe companies lowering their pricing in response to MadRock's market entry proves nothing of the kind. Supply and demand curves ALWAYS reset to a new level when competition either enters or leaves a market.

Curt

Well, I'm giving up on this because you are both completely wrong and completely convinced that you are right. Probably the most fundamental tenet of perfect competition is that the pool of buyers and sellers is so big that no seller or buyer can influence the price.

In the article Perfect Competition, Wikipedia wrote:
In economics, perfect competition occurs in markets in which no participant has market power. Because the conditions for perfect competition are strict, there are few if any perfectly competitive markets. Nonetheless, the concept of perfect competition can serve as a useful benchmark against which to measure real life, imperfectly competitive markets.

Generally, a perfectly competitive market exists when every participant is a "price taker," and no participant influences the price of the product it buys or sells.

Additionally, see the wikipedia article on "market power."

Edit: Incidentally, I agree that oligopolies sometimes do engage in price competition, but I sure don't see that occurring in the climbing shoe market. Luckily for the manufacturers, and unluckily for the rest of us, the market is convinced that Mad Rocks are an inferior shoe. Were they able to convince the market that they were able to produce a shoe of comparable quality to the competition's at a fraction of the price, the story might have been different.

Jay


(This post was edited by jt512 on Apr 8, 2010, 1:29 AM)


curt


Apr 8, 2010, 1:31 AM
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jt512 wrote:
curt wrote:
jt512 wrote:
Furthermore, if it is true that other firms lowered their prices based on Mad Rock's entry into the market, then (1) that is conclusive proof of imperfect competition...

You clearly need to revisit Macro Economics 101. Other climbing shoe companies lowering their pricing in response to MadRock's market entry proves nothing of the kind. Supply and demand curves ALWAYS reset to a new level when competition either enters or leaves a market.

Curt

Well, I'm giving up on this because you are both completely wrong and completely convinced that you are right. Probably the most fundamental tenet of perfect competition is that the pool of buyers and sellers is so big that no seller or buyer can influence the price.

In the article Perfect Competition, Wikipedia wrote:
In economics, perfect competition occurs in markets in which no participant has market power. Because the conditions for perfect competition are strict, there are few if any perfectly competitive markets. Nonetheless, the concept of perfect competition can serve as a useful benchmark against which to measure real life, imperfectly competitive markets.

Generally, a perfectly competitive market exists when every participant is a "price taker," and no participant influences the price of the product it buys or sells.

Additionally, see the wikipedia article on "market power."

Jay

Well, I'm giving up on this because you are both completely wrong and completely convinced that you are right. You are obviously confusing the theoretical concept of "perfectly competitive markets" with the ability of oligopolies to arrive at exactly the same prices by balancing supply and demand--which they often do.

Curt


squierbypetzl
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Apr 8, 2010, 4:39 AM
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curt wrote:
jt512 wrote:
curt wrote:
jt512 wrote:
Furthermore, if it is true that other firms lowered their prices based on Mad Rock's entry into the market, then (1) that is conclusive proof of imperfect competition...

You clearly need to revisit Macro Economics 101. Other climbing shoe companies lowering their pricing in response to MadRock's market entry proves nothing of the kind. Supply and demand curves ALWAYS reset to a new level when competition either enters or leaves a market.

Curt

Well, I'm giving up on this because you are both completely wrong and completely convinced that you are right. Probably the most fundamental tenet of perfect competition is that the pool of buyers and sellers is so big that no seller or buyer can influence the price.

In the article Perfect Competition, Wikipedia wrote:
In economics, perfect competition occurs in markets in which no participant has market power. Because the conditions for perfect competition are strict, there are few if any perfectly competitive markets. Nonetheless, the concept of perfect competition can serve as a useful benchmark against which to measure real life, imperfectly competitive markets.

Generally, a perfectly competitive market exists when every participant is a "price taker," and no participant influences the price of the product it buys or sells.

Additionally, see the wikipedia article on "market power."

Jay

Well, I'm giving up on this because you are both completely wrong and completely convinced that you are right. You are obviously confusing the theoretical concept of "perfectly competitive markets" with the ability of oligopolies to arrive at exactly the same prices by balancing supply and demand--which they often do.

Curt

Whew, I´m glad that´s over before someone actually learned something.


I_do


Apr 8, 2010, 8:29 AM
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squierbypetzl wrote:
curt wrote:
jt512 wrote:
curt wrote:
jt512 wrote:
Furthermore, if it is true that other firms lowered their prices based on Mad Rock's entry into the market, then (1) that is conclusive proof of imperfect competition...

You clearly need to revisit Macro Economics 101. Other climbing shoe companies lowering their pricing in response to MadRock's market entry proves nothing of the kind. Supply and demand curves ALWAYS reset to a new level when competition either enters or leaves a market.

Curt

Well, I'm giving up on this because you are both completely wrong and completely convinced that you are right. Probably the most fundamental tenet of perfect competition is that the pool of buyers and sellers is so big that no seller or buyer can influence the price.

In the article Perfect Competition, Wikipedia wrote:
In economics, perfect competition occurs in markets in which no participant has market power. Because the conditions for perfect competition are strict, there are few if any perfectly competitive markets. Nonetheless, the concept of perfect competition can serve as a useful benchmark against which to measure real life, imperfectly competitive markets.

Generally, a perfectly competitive market exists when every participant is a "price taker," and no participant influences the price of the product it buys or sells.

Additionally, see the wikipedia article on "market power."

Jay

Well, I'm giving up on this because you are both completely wrong and completely convinced that you are right. You are obviously confusing the theoretical concept of "perfectly competitive markets" with the ability of oligopolies to arrive at exactly the same prices by balancing supply and demand--which they often do.

Curt

Whew, I´m glad that´s over before someone actually learned something.

I don't think we were at risk.


veilneb


Apr 8, 2010, 11:06 AM
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Buy American!
In reply to:


I_do


Apr 8, 2010, 11:12 AM
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veilneb wrote:
Buy American!
In reply to:

Hell no I value craftsmenship and quality!


veilneb


Apr 8, 2010, 12:51 PM
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I_do wrote:
veilneb wrote:
Buy American!
In reply to:

Hell no I value craftsmenship and quality!

Okay! Buy Dutch! Oh wait...
In reply to:


johnwesely


Apr 8, 2010, 1:07 PM
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As far as I can tell, the Chinese never cheesetit.


xaniel2000


Apr 8, 2010, 1:32 PM
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I like turtles


blueeyedclimber


Apr 8, 2010, 2:11 PM
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I slept through the only college business course I ever took.

Anyways, although I don't have anything relevant to add, is anybody else wondering if OLIGOPOLY would make a fun board game?

Josh


kachoong


Apr 8, 2010, 2:17 PM
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blueeyedclimber wrote:
I slept through the only college business course I ever took.

Anyways, although I don't have anything relevant to add, is anybody else wondering if OLIGOPOLY would make a fun board game?

Josh

That's usually how most Monopoly games end up being played out anyway... brother and dad gang up on the others with some kind of cartel... moving money and get out of jail free cards under the table.


yanqui


Apr 8, 2010, 2:53 PM
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Nice job on an interesting discussion ... too bad it degenerated after this post.

I thought it might be interesting to add that there are only two shoe companies that operate here: a (very small) local company (Teknia) and Mad Rock. Buying from the outside on intenet is not a real option (because of hassles from Argetnine customs, mail theft and import taxes) -- although there is the possibilty of buying shoes outside the country, if you travel. Anyways, in spite of a 21% national sales tax, import taxes and a (generally) higher mark up from retailers (only a few small localities in the whole country) Mad Rock shoes are about the same price here as in the US. The local Argentine shoes (Teknias) are about US $15 cheaper, but I doubt that has much of a competitive effect on the cost of Mad Rocks. My point being that the cost here (of Mad Rocks) seems to have little to do with the local market, and the company must be making some kind of effort to assure that the shoes cost about the same as in the US.


(This post was edited by yanqui on Apr 8, 2010, 2:55 PM)


jt512


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curt wrote:
Well, I'm giving up on this because you are both completely wrong and completely convinced that you are right. You are obviously confusing the theoretical concept of "perfectly competitive markets" with the ability of oligopolies to arrive at exactly the same prices by balancing supply and demand--which they often do.

Curt

k.i.k wrote:
Third, yes, manufacturers of all kinds of goods are allowed to demand, as a condition of sale to retailers, that the retailer not advertise the goods below MSRP except under certain conditions.

You can't have it both ways, Curt.

Jay


sidepull


Apr 8, 2010, 4:03 PM
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blueeyedclimber wrote:
I slept through the only college business course I ever took.

Anyways, although I don't have anything relevant to add, is anybody else wondering if OLIGOPOLY would make a fun board game?

Josh

Now that's something you SHOULD patent! Seriously, everyone tries to play Monopoly this way anyway.

And, to beat the dead horse, it's odd that people are surprised by Jay's claim that many markets are likely oligopolies. For example:

wikipedia Porter's Five Forces wrote:
Porter's five forces is a framework for the industry analysis and business strategy development developed by Michael E. Porter of Harvard Business School in 1979. It uses concepts developing, Industrial Organization (IO) economics to derive five forces that determine the competitive intensity and therefore attractiveness of a market. Attractiveness in this context refers to the overall industry profitability. An "unattractive" industry is one where the combination of forces acts to drive down overall profitability. A very unattractive industry would be one approaching "pure competition".

In other words, market leaders don't want perfect competition. They would prefer monopolies. Oligopolies are often the next best thing. So the idea that powerful companies, even in niche markets, strategically act in ways that limit classic supply/demand relationships should not be surprising. Indeed, if you do an industry ROI (or even ROA) analysis, you'll find that the most profitable industries are often those that exhibit imperfect competition.


k.l.k


Apr 8, 2010, 4:09 PM
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jt512 wrote:
curt wrote:
Well, I'm giving up on this because you are both completely wrong and completely convinced that you are right. You are obviously confusing the theoretical concept of "perfectly competitive markets" with the ability of oligopolies to arrive at exactly the same prices by balancing supply and demand--which they often do.

Curt

k.i.k wrote:
Third, yes, manufacturers of all kinds of goods are allowed to demand, as a condition of sale to retailers, that the retailer not advertise the goods below MSRP except under certain conditions.

You can't have it both ways, Curt.

Jay

Yes he can-- the practice of retailers advertising brand goods at msrp can be found in most sectors of the consumer goods. That may not resemble a "free market" as you learned the term from a textbook synopsis of adam smith's idealized account of political economy. But "free trade" and "free markets" are defined by the courts, the regulatory agencies, and the actual economic activities that we do. Your Econ 101 textbook is a radically over-simplified and idealized descriptive model. It's not prescriptive. It's not the Old Testament. It isn't even The Self-Coached Climber.

Again, if this example is evidence of oligopoly, then all consumer capitalism is an oligopoly.

The climbing shoe industry actually has far fewer barriers to entry than the athletics shoe industry at large. And it has more companies and price points than I've seen in thirty years.


jt512


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sidepull wrote:

[I]t's odd that people are surprised by Jay's claim that many markets are likely oligopolies.

Isn't it, though.

Jay


(This post was edited by jt512 on Apr 8, 2010, 4:09 PM)


jt512


Apr 8, 2010, 4:14 PM
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k.l.k wrote:
jt512 wrote:
curt wrote:
Well, I'm giving up on this because you are both completely wrong and completely convinced that you are right. You are obviously confusing the theoretical concept of "perfectly competitive markets" with the ability of oligopolies to arrive at exactly the same prices by balancing supply and demand--which they often do.

Curt

k.i.k wrote:
Third, yes, manufacturers of all kinds of goods are allowed to demand, as a condition of sale to retailers, that the retailer not advertise the goods below MSRP except under certain conditions.

You can't have it both ways, Curt.

Jay

Yes he can-- the practice of retailers advertising brand goods at msrp can be found in most sectors of the consumer goods. That may not resemble a "free market" as you learned the term from a textbook synopsis of adam smith's idealized account of political economy. But "free trade" and "free markets" are defined by the courts, the regulatory agencies, and the actual economic activities that we do...

Regulatory agencies? That's a good one.

I didn't say it was illegal. I said it results in excessively high prices (so maybe some practices should be illegal). Manufacturers don't fix the price at MSRP because it's lower than market, now, do they?

Jay


(This post was edited by jt512 on Apr 8, 2010, 4:16 PM)


k.l.k


Apr 8, 2010, 4:22 PM
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jt512 wrote:
k.l.k wrote:
jt512 wrote:
curt wrote:
Well, I'm giving up on this because you are both completely wrong and completely convinced that you are right. You are obviously confusing the theoretical concept of "perfectly competitive markets" with the ability of oligopolies to arrive at exactly the same prices by balancing supply and demand--which they often do.

Curt

k.i.k wrote:
Third, yes, manufacturers of all kinds of goods are allowed to demand, as a condition of sale to retailers, that the retailer not advertise the goods below MSRP except under certain conditions.

You can't have it both ways, Curt.

Jay

Yes he can-- the practice of retailers advertising brand goods at msrp can be found in most sectors of the consumer goods. That may not resemble a "free market" as you learned the term from a textbook synopsis of adam smith's idealized account of political economy. But "free trade" and "free markets" are defined by the courts, the regulatory agencies, and the actual economic activities that we do...

Regulatory agencies? That's a good one.

I didn't say it was illegal. I said it results in excessively high prices (so maybe some practices should be illegal). Manufacturers don't fix the price at MSRP because it's lower than market, now, do they?

The price of climbing shoes is not "excessively high" relative to other athletics shoes or to fashion shoes. It is not "excessively high" relative to high-margin soft goods like fleeces, socks and plastic underwear. The margins (for makers) on most climbing shoes appear to be lower than the margins on other athletics shoes and sportswear.

So why yr obsession with shoes? You're getting all Asperger's here.


jt512


Apr 8, 2010, 4:30 PM
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k.l.k wrote:
jt512 wrote:
k.l.k wrote:
jt512 wrote:
curt wrote:
Well, I'm giving up on this because you are both completely wrong and completely convinced that you are right. You are obviously confusing the theoretical concept of "perfectly competitive markets" with the ability of oligopolies to arrive at exactly the same prices by balancing supply and demand--which they often do.

Curt

k.i.k wrote:
Third, yes, manufacturers of all kinds of goods are allowed to demand, as a condition of sale to retailers, that the retailer not advertise the goods below MSRP except under certain conditions.

You can't have it both ways, Curt.

Jay

Yes he can-- the practice of retailers advertising brand goods at msrp can be found in most sectors of the consumer goods. That may not resemble a "free market" as you learned the term from a textbook synopsis of adam smith's idealized account of political economy. But "free trade" and "free markets" are defined by the courts, the regulatory agencies, and the actual economic activities that we do...

Regulatory agencies? That's a good one.

I didn't say it was illegal. I said it results in excessively high prices (so maybe some practices should be illegal). Manufacturers don't fix the price at MSRP because it's lower than market, now, do they?

The price of climbing shoes is not "excessively high" relative to other athletics shoes or to fashion shoes. It is not "excessively high" relative to high-margin soft goods like fleeces, socks and plastic underwear. The margins (for makers) on most climbing shoes appear to be lower than the margins on other athletics shoes and sportswear.

So why yr obsession with shoes? You're getting all Asperger's here.

It's not an obsession. I'm just stating facts. Why everybody except sidepull is so butt-hurt about it is beyond me.

Jay


billcoe_


Apr 8, 2010, 4:43 PM
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I can finally contribute something for you all.




jt512


Apr 8, 2010, 5:01 PM
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billcoe_ wrote:
I can finally contribute something for you all.


Need to add to the list of actions taken regarding the butthurt:
  • I gave all their posts one star.



curt


Apr 8, 2010, 5:22 PM
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Jay,

I will attempt, one last time, to explain your fundamental misunderstanding here. You have obviously "Googled" the terms "perfect competition" and "imperfect competition" and (without having sufficient background in economics) have assumed that perfect competition actually exists beyond a theoretical construct--it doesn't.

You have further assumed that climbing shoe prices are higher than they should be (whatever that means) in the US, simply because the climbing shoe market here may be described as an oligopoly. This is simply does not follow logically.

Oligopolies can (and often do) result in markets where price discovery is fair and supply balances demand. The actual prices that result may seem "high" (i.e. the collective sellers are wildly profitable) as with say, tobacco or pharmaceuticals--or the prices that are established may be "low" (i.e. the collective sellers may actually lose money, on average) as with the airline industry.

With both tobacco and the airlines (although the economic outcomes for the two are completely different) these industries are indeed managing to strike a fair balance between their output (supply) and what the market will pay (demand) in an efficient manner. You simply can not assume that because a market does not meet the textbook definition of "perfect competition" that prices are artificially higher than they should be--one simply doesn't lead to the other.

Curt


jt512


Apr 8, 2010, 5:50 PM
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curt wrote:
Jay,

I will attempt, one last time, to explain your fundamental misunderstanding here. You have obviously "Googled" the terms "perfect competition" and "imperfect competition" and (without having sufficient background in economics) have assumed that perfect competition actually exists beyond a theoretical construct--it doesn't.

Actually, I didn't google those terms. I studied economics in undergrad, including a year's coursework in imperfect competition.

Yes, perfect competition is a theoretical construct. That doesn't mean that the theory can't be used to validly model actual markets. Analogously, the normal distribution is a theoretical construct. I've yet to see a dataset whose population was actually normally distributed, but I've seen many datasets whose distributions were close enough to normal that they can be validly modeled as normal. Getting back to markets, when I was in school, there were markets for which perfect competition was a reasonable model. Agricultural commodities, for instance, before big agribusiness oligopolized (or monopolized, in the case of patented seeds) that market.

In reply to:
You have further assumed that climbing shoe prices are higher than they should be (whatever that means) in the US, simply because the climbing shoe market here may be described as an oligopoly. This is simply does not follow logically.

I have not made that assumption. I agree with you that oligopolies can lead to fierce price wars, as has happened in the airline industry. Where I disagree is that oligopolistic markets have fair prices "often." I have either never studied, or have forgotten, any economic theory that would predict that. More to the point, it is clear that prices for climbing shoes are above fair market value. The fact that manufactures require distributors to sell shoes at MSRP is all but conclusive proof of this, as is the "strongarming" that k.i.k mentioned, as is the fact that Mad Rock has certain models of shoes that are virtually identical to Five Ten's, but that have a much lower price.

In reply to:
With both tobacco and the airlines (although the economic outcomes for the two are completely different) these industries are indeed managing to strike a fair balance between their output (supply) and what the market will pay (demand) in an efficient manner.

That's an interesting claim. I was not aware that that could or should occur. But, as I explain above, that has not happened the climbing shoe market.

Jay


curt


Apr 8, 2010, 6:10 PM
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jt512 wrote:
curt wrote:
With both tobacco and the airlines (although the economic outcomes for the two are completely different) these industries are indeed managing to strike a fair balance between their output (supply) and what the market will pay (demand) in an efficient manner.

That's an interesting claim. I was not aware that that could or should occur. But, as I explain above, that has not happened the climbing shoe market.

There are at least two separate topics of discussion here. As far as the first goes, there is nothing in economic theory that says oligopolies will not discover efficient prices, unless (as I stated in previous posts) there is more going on--improper behavior such as price fixing, collusion, etc. A market being an oligopoly, in and of itself, is insufficient to cause artificially high market prices.

The second discussion (that climbing shoe prices are higher than they should be in the US) has been addressed by k.l.k. and it doesn't seem to me that you have yet demonstrated that to be factually true.

Curt


k.l.k


Apr 8, 2010, 6:15 PM
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jt512 wrote:
I've seen many datasets whose distributions were close enough to normal that they can be validly modeled as normal. Getting back to markets, when I was in school, there were markets for which perfect competition was a reasonable model. Agricultural commodities, for instance, before big agribusiness oligopolized (or monopolized, in the case of patented seeds) that market.


Hahahahahaha.

The historian laughs bitterly.

The climbing shoe market is a classical economists dream compared to agriculture in almost any period of American history.


curt


Apr 8, 2010, 8:34 PM
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jt512 wrote:
curt wrote:
Jay,

I will attempt, one last time, to explain your fundamental misunderstanding here. You have obviously "Googled" the terms "perfect competition" and "imperfect competition" and (without having sufficient background in economics) have assumed that perfect competition actually exists beyond a theoretical construct--it doesn't.

Actually, I didn't google those terms. I studied economics in undergrad, including a year's coursework in imperfect competition...

OK--that's good.

My macro 101 Professor back in Minnesota was Walter Heller. Ten to fifteen years before I took his class, he was Chariman of the Council of Economic Advisors for Presidents Kennedy and Johnson. Somewhat later, I authored and presented the following invited papers on market efficiencies:

1) Market Fragmentation and The Single Price Auction. Seattle Society of Financial Analysts, Seattle, WA. 10/3/1991

2) Innovations in trading, The Single Price Auction. The Columbine Quantitative Seminar, Colorado Springs, CO. 9/24/91

3) New Market Approaches for Electronic Execution, The Single Price Auction. Federation Internationale Des Bourses De Valeurs, Annual Conference, Chicago, IL. 9/18/91

4) Innovations in Electronic Trading, The Single Price Auction. FIM West Conference, Los Angeles, CA. 3/21/91

5) The Single Price Auction. DAIS Group Conference, La Quinta, CA. 3/18/91

6) The Single Price Auction: Pricing, Liquidity, and the Regulatory Environment. POSIT Conference, Longboat Key, FL. 3/6/91

7) Trading Costs and The Single Price Auction. AIMR Annual Conference, Laguna Niguel, CA. October, 1990

At the same time I was authoring those papers, I worked very closely with Vernon Smith at U of A in optimizing the trading algorithm used at the Arizona Stock Exchange, where I was Vice President. Vernon shared in the Nobel Prize in Economics in 2002 for basically inventing the field of experimental economics. Cool

Curt


jt512


Apr 8, 2010, 8:58 PM
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curt wrote:
jt512 wrote:
curt wrote:
Jay,

I will attempt, one last time, to explain your fundamental misunderstanding here. You have obviously "Googled" the terms "perfect competition" and "imperfect competition" and (without having sufficient background in economics) have assumed that perfect competition actually exists beyond a theoretical construct--it doesn't.

Actually, I didn't google those terms. I studied economics in undergrad, including a year's coursework in imperfect competition...

OK--that's good.

My macro 101 Professor back in Minnesota was Walter Heller. Ten to fifteen years before I took his class, he was Chariman of the Council of Economic Advisors for Presidents Kennedy and Johnson. Somewhat later, I authored and presented the following invited papers on market efficiencies:

1) Market Fragmentation and The Single Price Auction. Seattle Society of Financial Analysts, Seattle, WA. 10/3/1991

2) Innovations in trading, The Single Price Auction. The Columbine Quantitative Seminar, Colorado Springs, CO. 9/24/91

3) New Market Approaches for Electronic Execution, The Single Price Auction. Federation Internationale Des Bourses De Valeurs, Annual Conference, Chicago, IL. 9/18/91

4) Innovations in Electronic Trading, The Single Price Auction. FIM West Conference, Los Angeles, CA. 3/21/91

5) The Single Price Auction. DAIS Group Conference, La Quinta, CA. 3/18/91

6) The Single Price Auction: Pricing, Liquidity, and the Regulatory Environment. POSIT Conference, Longboat Key, FL. 3/6/91

7) Trading Costs and The Single Price Auction. AIMR Annual Conference, Laguna Niguel, CA. October, 1990

At the same time I was authoring those papers, I worked very closely with Vernon Smith at U of A in optimizing the trading algorithm used at the Arizona Stock Exchange, where I was Vice President. Vernon shared in the Nobel Prize in Economics in 2002 for basically inventing the field of experimental economics. Cool

Curt

Imagine, all that, and you still think that a market in which manufacturers make agreements with retailers to fix prices and exclude competitors results in fair market prices.

Jay


curt


Apr 8, 2010, 9:03 PM
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jt512 wrote:
curt wrote:
jt512 wrote:
curt wrote:
Jay,

I will attempt, one last time, to explain your fundamental misunderstanding here. You have obviously "Googled" the terms "perfect competition" and "imperfect competition" and (without having sufficient background in economics) have assumed that perfect competition actually exists beyond a theoretical construct--it doesn't.

Actually, I didn't google those terms. I studied economics in undergrad, including a year's coursework in imperfect competition...

OK--that's good.

My macro 101 Professor back in Minnesota was Walter Heller. Ten to fifteen years before I took his class, he was Chariman of the Council of Economic Advisors for Presidents Kennedy and Johnson. Somewhat later, I authored and presented the following invited papers on market efficiencies:

1) Market Fragmentation and The Single Price Auction. Seattle Society of Financial Analysts, Seattle, WA. 10/3/1991

2) Innovations in trading, The Single Price Auction. The Columbine Quantitative Seminar, Colorado Springs, CO. 9/24/91

3) New Market Approaches for Electronic Execution, The Single Price Auction. Federation Internationale Des Bourses De Valeurs, Annual Conference, Chicago, IL. 9/18/91

4) Innovations in Electronic Trading, The Single Price Auction. FIM West Conference, Los Angeles, CA. 3/21/91

5) The Single Price Auction. DAIS Group Conference, La Quinta, CA. 3/18/91

6) The Single Price Auction: Pricing, Liquidity, and the Regulatory Environment. POSIT Conference, Longboat Key, FL. 3/6/91

7) Trading Costs and The Single Price Auction. AIMR Annual Conference, Laguna Niguel, CA. October, 1990

At the same time I was authoring those papers, I worked very closely with Vernon Smith at U of A in optimizing the trading algorithm used at the Arizona Stock Exchange, where I was Vice President. Vernon shared in the Nobel Prize in Economics in 2002 for basically inventing the field of experimental economics. Cool

Curt

Imagine, all that, and you still think that a market in which manufacturers make agreements with retailers to fix prices and exclude competitors results in fair market prices.

Jay

I never said that and you know it. I suppose I could ask Vernon Smith to tell you that oligopolies don't intrinsically fix prices--but you would probably just tell him that he also is wrong. I mean, nobody could possibly understand economic markets better than you.

Curt


thomasribiere


Apr 8, 2010, 9:05 PM
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squierbypetzl wrote:
And if any ClimbX (TM) people are out there reading, my comprehensive legal services are readily available. Tongue

Do you ALSO double charge for your services?


jt512


Apr 8, 2010, 9:11 PM
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curt wrote:
jt512 wrote:
curt wrote:
jt512 wrote:
curt wrote:
Jay,

I will attempt, one last time, to explain your fundamental misunderstanding here. You have obviously "Googled" the terms "perfect competition" and "imperfect competition" and (without having sufficient background in economics) have assumed that perfect competition actually exists beyond a theoretical construct--it doesn't.

Actually, I didn't google those terms. I studied economics in undergrad, including a year's coursework in imperfect competition...

OK--that's good.

My macro 101 Professor back in Minnesota was Walter Heller. Ten to fifteen years before I took his class, he was Chariman of the Council of Economic Advisors for Presidents Kennedy and Johnson. Somewhat later, I authored and presented the following invited papers on market efficiencies:

1) Market Fragmentation and The Single Price Auction. Seattle Society of Financial Analysts, Seattle, WA. 10/3/1991

2) Innovations in trading, The Single Price Auction. The Columbine Quantitative Seminar, Colorado Springs, CO. 9/24/91

3) New Market Approaches for Electronic Execution, The Single Price Auction. Federation Internationale Des Bourses De Valeurs, Annual Conference, Chicago, IL. 9/18/91

4) Innovations in Electronic Trading, The Single Price Auction. FIM West Conference, Los Angeles, CA. 3/21/91

5) The Single Price Auction. DAIS Group Conference, La Quinta, CA. 3/18/91

6) The Single Price Auction: Pricing, Liquidity, and the Regulatory Environment. POSIT Conference, Longboat Key, FL. 3/6/91

7) Trading Costs and The Single Price Auction. AIMR Annual Conference, Laguna Niguel, CA. October, 1990

At the same time I was authoring those papers, I worked very closely with Vernon Smith at U of A in optimizing the trading algorithm used at the Arizona Stock Exchange, where I was Vice President. Vernon shared in the Nobel Prize in Economics in 2002 for basically inventing the field of experimental economics. Cool

Curt

Imagine, all that, and you still think that a market in which manufacturers make agreements with retailers to fix prices and exclude competitors results in fair market prices.

Jay

I never said that and you know it.

So, then, do we agree that in the US that climbing shoes generally sell for greater than their fair market value?

In reply to:
I suppose I could ask Vernon Smith to tell you that oligopolies don't intrinsically fix prices...

I have already agreed with you that they don't.

Jay


sidepull


Apr 8, 2010, 9:27 PM
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Isn't it possible to have a middle ground?

I think there is evidence that the prices are artificially high. You would think after years of refining their products, that the learning curve effects would lead to reduced marginal costs, that overseas supply chains would similarly reduce costs, and that increased competition from new companies (Madrock, Evolv, ClimbX, etc.) would also decrease costs. Yet FiveTen and Sportiva still sell most of their models in the $120 to $150 range. Why is that price so durable? (Please note that I didn't need to revert to the Barrabes even though I don't think a more plausible argument to explain that dynamic has been forwarded here).

As Vives suggests, "The possibility of collusion among producers has been a permanent concern of oligopoly theory ... This tacit collusion view has been endorsed by many influential economists, including Fellner (1949), Samuelson (1967), and Stigler (1964)" (2001: 6; see: http://www.amazon.com/...270760989&sr=8-1). In other words, the few people at the top understand how to keep themselves there and how to police the smaller players (again, read Porter).

Curt is right, an oligopoly does not necessitate artificially high prices. But it rarely produces efficiency.

So the middle ground is that Curt is theoretically right, oligopolies do not by necessity produce artificially high prices, but that Jay is right about this example, the climbing shoe industry is likely best modeled by classic oligopolies where prices are maintained at an artificially high level.

Now you can both disagree with me!Laugh


curt


Apr 8, 2010, 9:28 PM
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Honestly, I don't even know how you would go about establishing aggregate "fair market value" for climbing shoes in the US. Typically, in markets where a meaningful and robust FMV can be established there is some sort of centralized marketplace (like a stock exchange, for example) with many simultaneous buyers and sellers. So, I'm not sure that FMV, as it's normally defined, can really be applied to climbing shoes.

I'm also not sure that "price fixing" actually goes on between climbing shoe manufacturers and retailers. Not allowing the advertisement of climbing shoes for less than the MSRP by retailers certainly does not constitute price fixing, in any event.

Curt


jt512


Apr 8, 2010, 9:34 PM
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curt wrote:

I'm also not sure that "price fixing" actually goes on between climbing shoe manufacturers and retailers. Not allowing the advertisement of climbing shoes for less than the MSRP by retailers certainly does not constitute price fixing, in any event.

Curt

I realize that "price fixing" is a loaded term. I didn't mean that climbing shoe companies were engaging in illegal price fixing; however, requiring manufacturers to sell (or even to advertise) at MSRP is de facto price fixing, even if not de jure price fixing.

Jay


curt


Apr 8, 2010, 9:37 PM
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sidepull wrote:
...I think there is evidence that the prices are artificially high. You would think after years of refining their products, that the learning curve effects would lead to reduced marginal costs, that overseas supply chains would similarly reduce costs, and that increased competition from new companies (Madrock, Evolv, ClimbX, etc.) would also decrease costs. Yet FiveTen and Sportiva still sell most of their models in the $120 to $150 range. Why is that price so durable?

Well, it's just as easy to argue that learning curve effects and increased efficiency have kept the price of climbing shoes from going up much. The prices of many things don't go down merely because of learning curve effects and efficiencies. Automobiles are a good example of this.

Edited to add:

You could, in fact argue that since Boreal Fires sold for $78 when they first came to the US in 1983 and that $78 1983 dollars are now worth $175 dollars (because of inflation) that climbing shoes are currently priced far too low. Cool

Curt


(This post was edited by curt on Apr 8, 2010, 10:33 PM)


k.l.k


Apr 8, 2010, 9:40 PM
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sidepull wrote:
Isn't it possible to have a middle ground?


no


k.l.k


Apr 8, 2010, 9:48 PM
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jt512 wrote:
I didn't mean that climbing shoe companies were engaging in illegal price fixing; however, requiring manufacturers to sell (or even to advertise) at MSRP is de facto price fixing, even if not de jure price fixing.

You're starting to break down. I take it you mean "retailers."

Ok, let's follow yr argument here. Everything is an oligopoly and the sale of branded goods in the US is price fixing. CLimbing shoes are branded goods.

Therefore, the sale of climbing shoes involves price fixing.

Swell. But now we have no particular reason to care, since nothing involving the making and selling of climbing shoes differs in any meaningful way from the making and selling of other sorts of shoes and apparel.

Except that climbing shoes tend to have lower margins, the market is smaller, and the pay-- from marketing asst. to ceo --is lower than in comparable retail industries.

Those bastards!


jt512


Apr 8, 2010, 9:52 PM
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k.l.k wrote:
jt512 wrote:
I didn't mean that climbing shoe companies were engaging in illegal price fixing; however, requiring manufacturers to sell (or even to advertise) at MSRP is de facto price fixing, even if not de jure price fixing.

You're starting to break down. I take it you mean "retailers."

Yes (to both).

In reply to:
Ok, let's follow yr argument here. Everything is an oligopoly and the sale of branded goods in the US is price fixing. CLimbing shoes are branded goods.

Therefore, the sale of climbing shoes involves price fixing.

Geez, Kerwin, at least try a little to camouflage the straw man.

Jay


sidepull


Apr 8, 2010, 11:43 PM
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curt wrote:
sidepull wrote:
...I think there is evidence that the prices are artificially high. You would think after years of refining their products, that the learning curve effects would lead to reduced marginal costs, that overseas supply chains would similarly reduce costs, and that increased competition from new companies (Madrock, Evolv, ClimbX, etc.) would also decrease costs. Yet FiveTen and Sportiva still sell most of their models in the $120 to $150 range. Why is that price so durable?

Well, it's just as easy to argue that learning curve effects and increased efficiency have kept the price of climbing shoes from going up much. The prices of many things don't go down merely because of learning curve effects and efficiencies. Automobiles are a good example of this.

That's true in some cases. But in an oligopoly where there is tacit collusion (which is different than "price fixing" - although they feel the same), there is no incentive for any of the efficiency effects I mentioned to lower the price posed to the consumer because the consumer has no power to look to alternatives. In contrast, in a perfect market (again, theoretically - I think we've already established that none of the "models" that we are using perfectly translate to the real world) … ahem, in a perfect market, any efficiency gained is quickly transferred into price competition to secure customers. Again, not to beat Porter to death (and he's certainly got his flaws) but he does a compelling job of arguing that organizations enact strategy by attempting to create barriers to entry that create monopolistic or oligopolistic markets. Moreover, he argues that the efficiencies that I've mentioned usually can't create a strategic, competitive advantage for firms because these tactics are easily replicable. Finally, the automobile industry, at least in the US, is simply a case of mismanagement. Non US auto companies have been trying to compete on price, especially in Europe and developing countries.

curt wrote:
Edited to add:

You could, in fact argue that since Boreal Fires sold for $78 when they first came to the US in 1983 and that $78 1983 dollars are now worth $175 dollars (because of inflation) that climbing shoes are currently priced far too low. Cool

Curt

True, but we'd save money on the spandex (rather than waste it on Prana's pants) Shocked - so it would probably be a wash.

Good tangent: I wonder if there is a collector's market for old school climbing shoes the way there is for Air Jordans? You know how people buy a brand new pair to keep them pristine, like trading cards? If so, I could really use a pair of good condition boreal stingers!Cool


k.l.k


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Re: [sidepull] ClimbX [In reply to]
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quit bein such a frickin cheapskate and buy yr wife the pr of athletas she wants.


sidepull


Apr 10, 2010, 3:34 PM
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Re: [k.l.k] ClimbX [In reply to]
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k.l.k wrote:
quit bein such a frickin cheapskate and buy yr wife the pr of athletas she wants.

I was referring to this sort of spandex (but I'm glad you're cyber-stalking my posts in the "ladies' room"):



(This post was edited by sidepull on Apr 10, 2010, 5:30 PM)


MS1


Apr 10, 2010, 5:30 PM
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Re: [blueeyedclimber] ClimbX [In reply to]
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blueeyedclimber wrote:
I slept through the only college business course I ever took.

Anyways, although I don't have anything relevant to add, is anybody else wondering if OLIGOPOLY would make a fun board game?

Josh

Not exactly the same thing, but I did pick up a copy of this at a thrift store once for a few bucks:

http://www.antimonopoly.com/...opoly_boardgame.html

It is even more of a pain-in-the-ass to play than ordinary Monopoly.


sidepull


Apr 10, 2010, 5:32 PM
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Re: [MS1] ClimbX [In reply to]
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MS1 wrote:
blueeyedclimber wrote:
I slept through the only college business course I ever took.

Anyways, although I don't have anything relevant to add, is anybody else wondering if OLIGOPOLY would make a fun board game?

Josh

Not exactly the same thing, but I did pick up a copy of this at a thrift store once for a few bucks:

http://www.antimonopoly.com/...opoly_boardgame.html

It is even more of a pain-in-the-ass to play than ordinary Monopoly.

But it has "a patented probability technique, has given each side equal chances to win."Shocked


rmsusa


Apr 11, 2010, 2:41 PM
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Re: [jt512] ClimbX [In reply to]
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In reply to:
Then why—at least a few years ago—could you buy the same shoes in Europe for about half the price as in the US?

Currency, tariffs and distribution chain coupled with not very well thought out global pricing strategies.


rmsusa


Apr 11, 2010, 2:58 PM
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Re: [yanqui] ClimbX [In reply to]
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I thought it might be interesting to add that there are only two shoe companies that operate here:

And the reason that the big, global brands aren't there is....?


qwert


Apr 11, 2010, 8:17 PM
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Re: [rmsusa] ClimbX [In reply to]
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Will you two shut up already?

You already got to the point where one starts to list all the cool stuff he has done IRL to prove that he actually knows about the subject at hand!
Crazy

qwert


blueeyedclimber


Apr 12, 2010, 12:14 PM
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Re: [MS1] ClimbX [In reply to]
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MS1 wrote:
blueeyedclimber wrote:
I slept through the only college business course I ever took.

Anyways, although I don't have anything relevant to add, is anybody else wondering if OLIGOPOLY would make a fun board game?

Josh

Not exactly the same thing, but I did pick up a copy of this at a thrift store once for a few bucks:

http://www.antimonopoly.com/...opoly_boardgame.html

It is even more of a pain-in-the-ass to play than ordinary Monopoly.

That's not the ANTI-MONOPOLY, THIS is.....



Does anybody else remember this gem from the 70's? A game with no winners that fosters family communication. Pffffftttttt!!!! Laugh

Josh


johnwesely


Apr 12, 2010, 12:22 PM
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Re: [blueeyedclimber] ClimbX [In reply to]
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blueeyedclimber wrote:
That's not the ANTI-MONOPOLY, THIS is.....



Does anybody else remember this gem from the 70's? A game with no winners that fosters family communication. Pffffftttttt!!!! Laugh

Josh

I never played that game in particular, but I used to have at least 4 games that were like that when I was a kid. It is probably why I am such a wuss.


airscape


Apr 12, 2010, 12:39 PM
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Re: [blueeyedclimber] ClimbX [In reply to]
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blueeyedclimber wrote:
MS1 wrote:
blueeyedclimber wrote:
I slept through the only college business course I ever took.

Anyways, although I don't have anything relevant to add, is anybody else wondering if OLIGOPOLY would make a fun board game?

Josh

Not exactly the same thing, but I did pick up a copy of this at a thrift store once for a few bucks:

http://www.antimonopoly.com/...opoly_boardgame.html

It is even more of a pain-in-the-ass to play than ordinary Monopoly.

That's not the ANTI-MONOPOLY, THIS is.....

[image]http://www.christian-life-advisor.com/images/the-ungame-catholic.jpg
[/image]

Does anybody else remember this gem from the 70's? A game with no winners that fosters family communication. Pffffftttttt!!!! Laugh

Josh

No Winners??

Why is it called ungame instead of Uncapitalist-pig.


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