Aero price increase! Again? (Sept,2012)

[Justhandguns]

So, some sharp eye fellas in Hong Kong spotted this, I guess not many of you acutally look at the tiny news section in Aero's site.

http://www.aeroleatherclothing.com/news-detail.php?id=127

Reluctant Price Increases

04 Sep 2012
Some good news and some bad news, lets get the bad news over first...

During the last year or so we've been hit with all sorts of price increases, raw materials, shipping costs, utilities, insurance to name more than I can bear to think about. On top of this we are having to compete with Chinese companies when we are trying to buy some of our horsehide supplies and all of our sheepskin, we are never going to be able to outbid factories with much lower overheads and wages than ours.

Now, just to illustrate how spurious our government's election promise to reduce UK manufacturers administration costs and red tape really was, in October 2012 we have to, by law, introduce, operate and pay for a new pension "scheme" for all our employees ...and I use the US meaning of the word "scheme" intentionally. This is the really the straw that broke this camel's back, especially as we've seen in recent years that pensions only really benefit the pension companies, banks etc, in recent years the poor worker upon retirement always finds she/he's ripped off, I'm sure this latest "scheme" will be no different, it's just yet another tax on employing staff.

This, on top of everything else, leaves us with no option but to increase the prices on most of our jackets, we already put all our trade prices up in March meaning most of our trade customers now correctly feel there is too much of a gap between what they need to charge, retail, and what we charge online. As it's the volume of Aero's trade business that keeps our own retail prices lower than our perceived competition, without so many trade customers stocking Aero, our retail prices would need to be far higher than they are at present.

This is something we really don't want to do so here comes the good news, (such as it is)...

We didn't want to spring this on our customers overnight with no warning, especially as there a dozens of customers currently working out the details of prospective orders with the factory, so we won't be altering our prices until October 1st 2012. Any orders placed in September will be charged at the current price regardless of delivery date and, as always, no deposit will be taken and no charges made until the day the order leaves the factory.

Over the last few months we've worked hard to get our waiting list down to under three months for bespoke special orders, the slight downside of this "Price Freeze" might mean this gets extended if there is a big rush to avoid the increase but everyone will get a delivery date when placing any new order, whether before or after October 1st."

 

[wdw]

Saw that last night. It would be interesting to know what the percentage increase is to see if it's worth the effort ordering early.

 

[cloudylemonade]

So, some sharp eye fellas in Hong Kong spotted this, I guess not many of you acutally look at the tiny news section in Aero's site.

http://www.aeroleatherclothing.com/news-detail.php?id=127

I also linked to this story on our facebook page to alert our customers to this. We didn't want to post it ourselves on Fedora Lounge, as it is not really our place to bring up topics here, and we don't want anyone to think we are using FL to drum up buisness.

If we were trying to slip this under the radar we most certaintly would not be giving a months notice, most businesses won't give a notice period on increases.

We are still working out the extent of the increases, Horsehide is likely to be around 10%, Sheep, probably very little if anything as these went up in March. As I explained on our facebook page when questions were presented, if the shipment comes in at the previous prices for Sheepskin then there will be no further rise in price. Our new Euro Steer products will see no increase.

Our new prices will still undercut most if not all of the other top end firms offering similar style clothing.

If anyone has any further questions, please let me know!

Holly

 

[wdw]

If it's any consolation, much over-hyped (and over-priced) Belstaff have increased the price of their flagship Panther by over 20% to £1,200.

Aero's equivalent and infinitely superior Barnstormer isn't much more than half that.

While we're on, Holly, are any more new styles coming out imminently? That could affect buying decisions.

 

[hpalapdog]

Aero wrote: "having to compete with Chinese companies when we are trying to buy some of our horsehide supplies and all of our sheepskin, we are never going to be able to outbid factories with much lower overheads and wages than ours."

Last year a sheepskin supplier to RealMcoy went bust here in the UK.
http://www.organicsheepskins.com/www.organicsheepskins.coms/info.php?p=6
Their skins were better than most I've seen Aero use. If demand is increasing I don't understand why this happened nor indeed why Aero were sourcing some skins from America ?

There was a documentary recently on British TV about a UK cushion maker who runs factories in China and the UK. They have started to bring manufacturing back to the UK because there is no longer a large cost advantage in China. The difference worked out something like 12 pence on a cushion retailing for £8.

 

[cloudylemonade]

Aero wrote: "having to compete with Chinese companies when we are trying to buy some of our horsehide supplies and all of our sheepskin, we are never going to be able to outbid factories with much lower overheads and wages than ours."

Last year a sheepskin supplier to RealMcoy went bust here in the UK.
http://www.organicsheepskins.com/www.organicsheepskins.coms/info.php?p=6
Their skins were better than most I've seen Aero use. If demand is increasing I don't understand why this happened nor indeed why Aero were sourcing some skins from America ?

There was a documentary recently on British TV about a UK cushion maker who runs factories in China and the UK. They have started to bring manufacturing back to the UK because there is no longer a large cost advantage in China. The difference worked out something like 12 pence on a cushion retailing for £8.

We source our sheepskin from Australia. I'm not involved in the sourcing of suppliers, so I couldn't comment here to be honest.

The bottom line is the improving economy in China means they now have the money to buy these luxury items in mass numbers, hence their companies buying up the materials and everyone else struggling to get them as easily, and therefore the price increase due to increased demand. And although there may not be as big a cost difference in manufacturing as there once was I can assure you the wage level we pay our skilled machinists is far greater than someone sewing cushions in the UK!

 

[Sloan1874]

To be honest, given that a company like Hugo Boss charges close to £700 for off the peg leather jackets that you can't wear if there's a threat of rain, 10 per cent increase would seem a relatively small price to pay for bespoke quality - and let's not even discuss the Belstaff price tags (That's what you get when you start opening shops in expensive places like Glasgow's Prince's Square and run colossal advertising campaigns). I'm glad I saw this though, as it makes a visit to the factory this week even more worthwhile.

 

[Edward]

Yes, I've been expecting this, really. I wish I was in a position to order a new jacket ahead of the reduction, but alas no. Could be much, much worse. I suspect it will have a bigger impact on the second hand market than anything. I know I've noticed a lot of Aero jackets on eBay looking (though not always getting) about £100 more than this time four years ago.

 

[HorseHide]

Being in a business where I am not a "low cost provider", I make it a practice to never comment on the pricing of an item - who cares what the reasons are for the price increase ("Will wants a new Benz" is just as valid a reason as Chinese competition for hides) provided that the value is there? And if the value isn't there, customers will leave.

I think most of us find the Aero product to be a fine value but given that (1) the global economic rebound isn't "robust" and (2) there have been a number of "disruptions" this year for Aero (the AeroUSA debacle and the poor way that it was initially handled, the disclosures about how Aero "pockets" the VAT for non-EU customers, etc.) one can argue that they might have elected to delay this announcement. It might bring a flurry of new orders in September or it may be just one more reason to look elsewhere for a jacket. Not sure where I come out on it.

 

[Otter]

Yes, I've been expecting this, really. I wish I was in a position to order a new jacket ahead of the reduction, but alas no. Could be much, much worse. I suspect it will have a bigger impact on the second hand market than anything. I know I've noticed a lot of Aero jackets on eBay looking (though not always getting) about £100 more than this time four years ago.

Have you seen this: http://www.ebay.co.uk/itm/AERO-LEAT...pt=UK_Men_s_Coats_Jackets&hash=item27c0e815bf

Been around a wee while now.

 

[ButteMT61]

I'll pay more for items made in the USA, Scotland, etc. and with hides from the same sorts of legitimate sources now. At some point, I see countries with less attention to animal rights raising animals for hides. China would be my guess to start this if they use up/buy up all the hides on the open market today.
I'd rather my money go to a company like GW, Aero, etc. than some sweat shop that infringes on trademarks and could care less about workers and animals or what they do to make a buck. And before I get hammered for that, yes, I realize businesses here and elsewhere have a history of shady practices too - but we've improved a lot, and playing by the rules only hobbles us in this new world economy. Time to get the claws out and protect businesses against the Chinese ripoff machine.

 

[Baron Kurtz]

Them's the realities of doing business these days, sadly.

That press release looks like a Ken Calder-drafted effort! Or maybe the writing tone has passed down the generations?

 

[ButteMT61]

I can only imagine that type of notice is a vendor's least-favorite to announce. That said, I do recall lots of Jaguars, Ferraris and other luxury cars in the parking lot in Galashiels lol

 

[too much coffee]

Easy to do when getting an extra 15% VAT profit from the Asian and American markets.

 

[cloudylemonade]

I can only imagine that type of notice is a vendor's least-favorite to announce. That said, I do recall lots of Jaguars, Ferraris and other luxury cars in the parking lot in Galashiels lol

None that I've seen!!!

The news story did come from my dad, he's still the founder and chairman of Aero afterall.

 

[cloudylemonade]

Easy to do when getting an extra 15% VAT profit from the Asian and American markets.

Sigh.... I've already discussed this as much as is necessary, and put forward our reasoning for our pricing structure and explained it's not extra profit.

 

[tonypaj]

Easy to do when getting an extra 15% VAT profit from the Asian and American markets.

I hope that the above was a dry joke. I like dry jokes. I hate beating horses to death, even to get a nice hide...

 

[hpalapdog]

We source our sheepskin from Australia.

As I type the fields around my house in south Somerset are surrounded by sheep. Seems crazy to ship skins from the other side of the World given increased transportation costs and the higher value of the AUD.

http://www.xe.com/currencycharts/?from=AUD&to=GBP&view=5Y

 

[cloudylemonade]

As I type the fields around my house in south Somerset are surrounded by sheep. Seems crazy to ship skins from the other side of the World given increased transportation costs and the higher value of the AUD.

http://www.xe.com/currencycharts/?from=AUD&to=GBP&view=5Y

I've asked about this, and have been told the reasons that for the last few years we've used Australian Sheepskin now is that we used to use Fenland, their skins were no better than the Australian sheep and the bigger Aussie skins give far less wastage the UK skins.

 

[Edward]

Have you seen this: http://www.ebay.co.uk/itm/AERO-LEAT...pt=UK_Men_s_Coats_Jackets&hash=item27c0e815bf

Been around a wee while now.

Some things are rare for a reason. Yeah, I don't think they'll ever sell that at that price.... Jinkies, I know it's all subjective, but I'm not sure even the venerable Aero name could sell that at any price.....

I can only imagine that type of notice is a vendor's least-favorite to announce. That said, I do recall lots of Jaguars, Ferraris and other luxury cars in the parking lot in Galashiels lol

Ha.... Staff.... or customers? Aero do have a long way to go before they hit the price level of some places. I know there are an awful lot of people working in the like of Saville Row who are paid fairly yet could never afford to buy their own product at retail. Heh... I remember my boss when I worked in a shop as a student, it used to rive him nuts that people would make glib comments about how much money he was making, with glib assumptions that if he sold something for a hundred quid, that was a hundred quid made.... no concept of stock outlay, overheads, staffing..... Heh. I'm not making any point here, I think, just a stream of consciousness.... long day....