Explain Limited Productions

HappyDaddy

HappyDaddy

Joined
Dec 21, 2013
Messages
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Watching the release of the ZT 0801cf and the market response has me curious about limited productions. If I were X Knife Co, Inc., why would I do a limited production? To return to the example of the 0801cf, the demand clearly greatly outstrips supply. Why not sell as many as the market will buy? If it wasn't a limited production, would the demand be less? Do knife makers do limited productions for reasons other than to make sales of that particular model? Is it to build cache? Nothing wrong with that certainly - just curious about the business thinking that goes into limited productions by ZT, Spyderco, BM, etc.
 
I don't understand it, and it frankly irritates me to see great production knives announced with fanfare, only to be unattainable unless you're very lucky or willing to pay absurd prices. I can understand wanting to generate excitement about a new release by having a limited offering which impels people to get swept up in the excitement and just buy it, rather than to wait for the frenzy to die down. After all, there is a lot more demand for Military/PM2/Manix XL variants in s90v/CF than for the earlier regular production Stretch in those same materials, even though the Stretch is also generally well-regarded. But if you want to follow that limited release business model, why not do it in the same way as Busse and offer as many as the market will bear, but just for a limited time?

I find it more understandable in the case of Spyderco, where they typically just swap a blade steel and G10 color, but ZT limited editions, where they tool up to produce only a few hundred of an entirely new model seems strange. Did they really make much from their 0777 project? Perhaps it was just a loss leader to generate excitement in their line in general, and to help launch 0770 models, but I don't think that objective would have been hurt by releasing more of them either.

To be clear, I have limited Spyderco military, PM2 and native variants, and I have a 0777M390 and 0600, and I am grateful for them. But I only bought them because I was able to find them at reasonable prices, I have no intention of flipping them, and I would still have bought them if they'd have been available in larger numbers.
 
Its great business. If it wasn't, do you think they would do it? The limited knives drum up huge interest in the company and when people can't get their hands on the limited knives they will usually buy other models from that company. Those other models are their bread and butter (i.e. where they make the most money) A company like ZT probably makes a lot more profit on a 0300 than they do on a 0801CF. As with anything business, the answer to "why" is because it makes the company more money. After all, the only point of a business is to make money...
 
Simple law of supply and demand. More demand and less supply equals high price.

And yes, you could argue that if they would cut the price and make more available they could make more money. That simply falls to a business decision.
 
oharal said:
Its great business. If it wasn't, do you think they would do it? The limited knives drum up huge interest in the company and when people can't get their hands on the limited knives they will usually buy other models from that company. Those other models are their bread and butter (i.e. where they make the most money) A company like ZT probably makes a lot more profit on a 0300 than they do on a 0801CF. As with anything business, the answer to "why" is because it makes the company more money. After all, the only point of a business is to make money...
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I didn't suggest that it wasn't good business. I'm looking for an explanation as to why it is good business. Your idea that limited production create interest in the entire line is one I've seen before, and it makes some sense. But, I don't really understand how failing to sell the maximum number of a knife design that I could sell makes sense. Rather than have a set limited run, why not continue making a design until the market is satisfied? Mercedes will make as many AMG's as people will buy. The folks who'd like to have one but can't afford it will buy the standard model. Would it make sense to only make 1000 if it was clear that the demand was for 10,000? The creation of general interest in the brand doesn't strike me as a good reason, by itself.
 
When it comes to the ZT Boutique knives, you have to remember that they are making VERY VERY little money on them and in certain cases, they actually take a loss on the knife.

That's why they are limited runs. It's been discussed multiple times on here if you search.

ZT is in a hard place when it comes to them. If they make too few, people complain that there aren't enough and that secondary prices are too high and if they make too many people complain about lack of exclusivity, holding values etc. When it came out that they made a few hundred more ZT0560CBCFs, people lost their minds.

I look at it like the Bugatti Veyron. VW loses like $300,000 on every one that they sell. They still sell them for the prestige, raising the profile of their portfolio and to test new manufacturing and performance technologies.
 
oharal said:
Its great business. If it wasn't, do you think they would do it? The limited knives drum up huge interest in the company and when people can't get their hands on the limited knives they will usually buy other models from that company. Those other models are their bread and butter (i.e. where they make the most money) A company like ZT probably makes a lot more profit on a 0300 than they do on a 0801CF. As with anything business, the answer to "why" is because it makes the company more money. After all, the only point of a business is to make money...
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Just cause a business is doing something doesn't necessarily make it good business. In this case, maybe it is, maybe it isn't. I'd think they would make more money selling more knives rather than drumming up interest. I was interested in the 801cf, but due to the limited number that's not going to happen. I'm not buying another ZT in Lieu of the 801cf, I have a 10/22 that needs new parts...that's where my 801cf funds will be spent instead.
 
Its probably has something to do with manufacturing capacity to. You got to think they're also putting out thousands of there production knives like PM2s, Leeks, Mini Grips etc etc at the same time which are there money makers, so doing these take real estate from those. They also on some instances only have X amount of the steel or material on hand that is being used.

Pretty much all the major knife companies do LE knives. Places like ZT and Benchmade Gold Class use it to show what can be done with higher end materials and finishes.
 
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Limited production translates to.
Charge you more MONEY
 
Scurvy092 said:
I look at it like the Bugatti Veyron. VW loses like $300,000 on every one that they sell. They still sell them for the prestige, raising the profile of their portfolio and to test new manufacturing and performance technologies.
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The reason that they "supposedly" lose money is because they had such high R&D costs (roughly 1.62 billion). Every car they sell offsets a little bit of that R&D, but not that big of a market for a 1.5 million dollar car. ZT on the other hand, has done the R&D and could easily sell many more knives but instead they choose not to. Whoever came up with this idea...:thumbdn:
 
Kyle_4 said:
The reason that they "supposedly" lose money is because they had such high R&D costs (roughly 1.62 billion). Every car they sell offsets a little bit of that R&D, but not that big of a market for a 1.5 million dollar car. ZT on the other hand, has done the R&D and could easily sell many more knives but instead they choose not to. Whoever came up with this idea...:thumbdn:
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It's just an example. Chevy loses money on every Volt due to the cost of the batteries.

What makes you think there was no R&D involved? You can be damn sure a knife like the ZT0777 had a TON of R&D in it. Not to mention all of the tooling costs, programming machines, orders from vendors you might not normally deal with, having to stop production on a particular knife to do a run of the limited editions (usually a knife with a much higher profit margin). All that raises the costs of production.
 
HappyDaddy said:
I didn't suggest that it wasn't good business. I'm looking for an explanation as to why it is good business. Your idea that limited production create interest in the entire line is one I've seen before, and it makes some sense. But, I don't really understand how failing to sell the maximum number of a knife design that I could sell makes sense. Rather than have a set limited run, why not continue making a design until the market is satisfied? Mercedes will make as many AMG's as people will buy. The folks who'd like to have one but can't afford it will buy the standard model. Would it make sense to only make 1000 if it was clear that the demand was for 10,000? The creation of general interest in the brand doesn't strike me as a good reason, by itself.
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"Rather than have a set limited run, why not continue making a design until the market is satisfied?"

What your saying make no sense and contradicts its self.

I assume you know what the word Limited means?

Its a Limited Edition.

If enough of anything is made until the market is satisfied then its not Limited anymore is it. This goes for stamps, coins, baseball cards or anything else that's collectable.

If the demand is for 10,000 and 10,000 are made then where does the Limited come into it. Its just another knife.
 
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There are so many different takes on this but I'd like to share that for me, as a customer, I care much less for the reasoning behind it but more about my bottom line... They make a knife I want, I should be able to get it at the maker's original target price. The recent PM2 in s90v/cpm154, Spyderco only made 300... Trust me, I'm good at acquiring LE's but no go for this one and IT PISSED ME OFF. I know all their reasons why but it it's still BS. Hinderer's aren't LE, but I've given up on getting one... As far as BM's Gold class/LE's, they are limited but they are far easier to acquire than other brands'...just an observation.

I know that it's "damned if you do, damned if you don't" a lot of times for these makers but it's nice to be able to get a CRK when I want one as opposed to Hinderer where you either have to be a superhero or are willing to pay middlemen to be able to get one. Thank God and all the saints that the 0562CF is production BABY YEAH!

I would have liked to have seen ZT make their well deserved money on the ZT777 instead of Microtech and Adai instead... Know what I mean?

I actually like very much how the 560CBCF panned out, I got my two at good prices, and the flippers got hosed...AND EVERYONE WHO WANTED ONE... GOT ONE ;)
 
Also you have to think how many people really spend $300-$750+ on a knife. Sure some LEs sell quick but I could still get my hands on a ZT0600 and alot of the Gold Class knives from many a retailer.
 
"What your [sic] saying make [sic] no sense and contradicts its self [sic]."

Of course it makes sense. "Set" qualifies "limited production." Meaning - a limited production of a preset number, as opposed to a limited production that is not preset in number. It would be the difference between deciding in advance to produce 1000 units and producing 1000 units because that was all the material availability would support after production began.
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So, no one has a theory other than that they enhance overall brand desirability? Maybe it's that simple.
 
Building brand Recognition.

Pushing design, material, technology and manufacturing capabilities.
 
Just to add, there are alot of of pure collectors out there that love the "LIMITED" thing. I really gives a rat's you know what for "LIMITED" but it serves a group of customers. I'd rather see a thousand more happy guys talking about their 801CF than a couple "collectors" posting pictures of multiple 801CF's like look at me Im special!

Another thing, I totally understand that producing knives like the 801CF isn't the easiest thing to do for a company BUT a good compromise worth exploring is making some knives "LIMITED PRODUCTION RUN" sort of like the Kershaw damascus knives or the fluted Ti Millie/N5.
 
It makes me sad that this thread comes up literally after every single limited edition Kai product sells out. People get mad and have to scapegoat someone (namely the company or the retailers) for why they didn't get a knife and others did. The bottom line is Kai does this because it makes them more money in one way or another. Thomas has said it on multiple occasions why they do these runs at all and why they can't be made regular production. Rest assured, if this was bad business, Kai would have no part in it. After all, we're talking about one of the biggest knife manufacturers (if not the biggest?) in the world. They've been around 40 years because they are good at it and the things they do make money.

It's strange to me that some people think that it should be easy to collect all the limited editions they like. Frankly it may even be a bit selfish. There have been countless knives I was unable to get my hands on before the price shot up. Some I paid up for secondary market price and others I had no choice but to give up on. Its better to move on then to make a big deal out of it because knife collecting should be fun not troublesome.

Anyway I think at this point we have beaten the subject to death...it might be time to file this subject in the same use the search functiondrawer with "what knife steel is best" or "what knife should I get for self defense"...

End rant/ramble :)
 
chester22 said:
Its probably has something to do with manufacturing capacity to. You got to think they're also putting out thousands of there production knives like PM2s, Leeks, Mini Grips etc etc at the same time which are there money makers, so doing these taken real estate from those. They also on some instances only have X amount of the steel or material on hand that is being used.

Pretty much all the major knife companies do LE knives. Places like ZT and Benchmade Gold Class use it to show what can be done with higher end materials and finishes.
Click to expand...

:thumbup:
 
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