- Joined
- Sep 11, 1999
- Messages
- 1
I have been a member at Knife Forums and read the Microtech Collectors forum. . I do not agree with what Microtech is doing by trying to control the market price for their products. I don't even know if it is legal. If I was a dealer I would understand some of this but if I buy something from Microtech and it does not sell I should be able to sell it for whatever I want. They can't force me to sell at a certain price. I have a good collection of Microtech and I like the value of it to stay high but I also like to get a good deal and if a dealer sell me something cheap then that is their decision. Who knows, am I missing something here?
I used a different name because I do not want to loose my posting priveledges at KnifeForums I have been on both forum for a long time. I also know that this may start something but I feel it is important that you all know what goes on in the market and the secret forum on the other site.
This was just posted today by Valmet, what do you think?
I used a different name because I do not want to loose my posting priveledges at KnifeForums I have been on both forum for a long time. I also know that this may start something but I feel it is important that you all know what goes on in the market and the secret forum on the other site.
This was just posted today by Valmet, what do you think?
Well, people have asked and asked and asked and asked etc...., so I'll venture to talk about this subject- one that's on everyone's mind.
In the past few months, we have seen a decline in MT sales across the board. One can look at all the 4SALE Forums on the NET and find that there are many Highly Desirable MTs, at very good prices, that aren't selling. Well my advice has always been, and will always be, to take advantage of the deals out there. Although these are some of the toughest times ever in the MT Market, THERE IS NO DOUBT IN MY MIND THAT THE MARKET WILL EVENTUALLY RECOVER.
Now for some plausible explanations.
The present market decline, IMHO, is due to Whoring of Products and Too much profit taking at all levels. However, it should be noted that MT is addressing these issues.
Now for some discussion.
MT is to knives as Rolex and Philippe are to watches. IMHO, the Two things that drives us towards MTs are QUALITY and IMAGE. Now people may complain about some Flaky Coating Crap, BUT, the QUALTIY is still here. HOWEVER, the Whoring of Product has tarnished the reputation. Now some may say It's the American Way, well, that's not helping. People who ***** the knives for cost are only hurting the market. Hey, on the short term you will get a great deal, BUT, in the long term you will make nothing on your investment. People who dump for no good reason aren't interested in anything but a Quick Buck. They really don't care about you, me, MT, or the Market at all. All the Distributors and Dealers Signed a Contract with MT to the tune that they would not list the knives below MSRP. However, anyone who signed said contract can sell said product for whatever they want. This is why I always tell people to develop a good relationship with one dealer, as you will end up saving a lot of money in the long run as any good Dealer/Distributor will reward loyalty with good deals. Now as far as those individuals who don't abide by said contract, well, they won't be buying from MT or the Custom MT Distributor anymore. So if you're reading along here, you'll notice my wording in the previous sentence. Yes, those who violated the terms of said contract may still be able in the short term to get MT products through Back Doors, and they have. Additionally, they have also dumped products for less than cost, in some instances, out of spite. Now the average MT enthusiast cannot be blamed for taking advantage of the good deals, but one should not think that they have your interests in mind. You have to ask yourself why they are selling so cheap when they really don't need to??? Sure, you'll hear all the diatribe from all the First Amendment Junkies, but I urge people to think about these individuals real motives. BTW, those who are DIRE Supporters of the First Amendment, please note that the first part of the previous statement should only be interpreted as a Tongue and Cheek remark.
Now for the most controversial issue- Profit Taking.
The reason why MT prices are at the levels that we see now is due to the MARKET. When Tony and the gang started making knives, they were selling them for next to nothing. How about a CFO I for $245??? The reason why the MT prices are as high as they are now is strictly due to the AFTERMARKET PRICES FROM THE PAST. Yes, MT charges more for their Custom Stuff now, but it is due to the market. I certainly don't blame them for taking advantage of a Good Thing, as it was Tony's hard work that people were profiting off of. People were selling 1st Run Satin Nemesis for up to $1200 at one point, when Tony and the gang were seeing roughly 1/4 of that. The people who gouged and tried to get as much as they possibly could for a piece have now created a problem, as we're now finding that the market cannot sustain these elevated price levels. People selling Giant HALOs for $9500+, Dragon Slayers for $4000 (Not #001!), etc..., created a False Sense of Value. I don't think the Desirability for MTs has ever decreased, but the higher asking prices have created problems. Now people feel violated that they are losing money on their investment, and I can't blame them, but it's because of greedy bastards on the Secondary Market that the situation ever came about in the first place.
I think a lot of the Sell Offs that we are seeing now are from MT enthusiasts who are Liquidating Inventory in order to raise Capital to afford some of these new very expensive pieces. Yes, others are dumping because they think the market is doomed, but that is not the case in reality. The problem that I foresee is that we may have a Vicious Cycle of people dumping one Custom MT in order to buy the next, and unfortunately, it's happening as we speak. Back in the day, how many people were routinely seeing Brend HALO IIs (A Run of around 33 pieces) offered for sale every day???? Few if any were ever trading. Now we have these limited runs of 30 knives, yet they aren't moving like they used to, and some collectors are selling them shortly after they purchase them, due to their desires to raise money to buy the next MT. Enough said.
Well, there is a solution to the problem, and I've actually been informed that MT is also working on the situation.
1. The So Called "Market Dumpers" must be eliminated. If people want to abide by the terms of the contract, then they will continues to prosper on the long term. I've had a least 5 dealers contact me with their concerns about people selling at or below cost. Some of these dealers are Good Friends of mine who feel like they are being punished for doing the right thing. Well, the Good News, IMHO, is that this problem is being successfully addressed by MT.
2. We need to see a Price Cut on some of the Custom Pieces at the Retail Level. Excluding the Damascus and Brend M-UDTs, I haven't seen too many knives selling for less than the wholesale cost, but I have been a little alarmed when I've seen people listing MTs above[/i] the MSRP. The profit margin suggested by MT via their MSRPs is more than enough, and I don't see any reason why one should charge more than the MSRP. Now the Good News here is that we are seeing some improvements in this area, which are the following:
a. The FrogMan controls the Distribution of the "High End" fare. Tom doesn't put up with nonsense, and he has been with Tony forever!, so he's the Best Man for The Job.
b. The Custom runs are being spread out over time to try and eliminate the need for the collector to dump the first half of his collection in order to be able to afford the next $2000 knife. The problem is that out of 30 buyers per month, a fairly significant number of the buyers cannot afford 1-2 $2000+ knives every month.
c. We need the number of dealers to remain fairly constant. I've been getting calls from dealers who are getting alarmed that all these new Fly By Night dealers are hurting their businesses. Now some of these Fly By Nighters have been in business a long time, and they continued to pump product out at Cut Rate prices up till a few weeks ago when they were shown the door.
d. We need a Price Cut On the SS Handle OTF Runs. My indications are that people will be selling some of their Dragon Slayer IIs in order to finance their Brend and Dam SS Patriots and Dam CFO II. We have a potentially Viscious Cycle here where we'd see the market flooded with High End MTs every other month or so. This isn't a "Sustainable Practice". However, it appears, check Patrick's latest post here as well, that we are seeing some much needed "Price Cuts". Ideally, I would like the SS Handle OTFs to retail for $1500 RETAIL. After months of extensive research, I've found that $1500 is about the AVERAGE MAXIMUM that a Serious MT Collector is willing to pay overall. Yes, I know plenty of MTs that wholesale and retail for a lot more than this, but I am referring to the runs of 30 here. One can see for oneself that APMs at $1200+ tend to move really fast off the boards, so if the Custom SS Handle OTFs could hit the Retail Scene for $1500, then I think a lot of the Dumping Problems would be solved.
Well, this is my take on the market as I see it today. We may be in a Depression, but the market is NOT Doomed.
-RadarMan-(<
