Your "mowing the lawn" mention reminded me of something that somewhat pairs with the discussions when we're talking about production costs versus "high-end" premium. Not trying to shoot myself in the foot here, but it got me to thinking...Originally Posted by badwhale
Last year my "high end" (considered to be so by most, I suppose) Toro lawnmower took it's final crap. I say that because it had been literally on its last legs since the day I purchased it. I chose Toro because of its reputation. After having owned a Toro - I'll tell you I would have done much better with an MTD....
So - when I went to replace it, I thought about brand (reputation). What is better than a John Deere, right!?! So - I spend the extra $$$ and went for the John Deere! Come to find out - the John Deere lawnmower I bought was likely manufactured for John Deere at MTD... Imagine that!!!
Now - quite frankly - I was a bit put off by that. Why did I not just buy an MTD (which was, after all, considerably cheaper)? So I did some side by side comparisons. Here's what I found...
They might have both been made at the same plant, but it was clear that they were both not made with the same parts. Are John Deere parts more expensive? Not sure - but they do seem to have more of a "heft" to them. Does the part justify the added expense of a John Deere lawnmower? Well - I can't really say for sure other than to say I'm happy I've traded my Toro for a John Deere... Is the John Deere better than a regular MTD? Well - I think so. Is is so much better that I should have paid extra money? Well... Ummm...
I get where you're coming from when you're comparing Lexus to Toyota, Acura to Honda, Infiniti to Nissan. Except that I own an Infiniti... In my view, while there are some similarities there's otherwise very little comparison between the G35 and the Maxima. If anything - when I take the car in for service I'm treated COMPLETELY differently. I'm used to the Chevy/Ford/Nisssan service department mentalities - and there ain't no comparison to the Inifiniti Service Department mentality. So - if there is no difference in the cost of the part being put into my car - there sure is a difference on the back end with the higher level of service I'm given. I do expect the same "level" of service experience from John Deere. Knock on wood - everything's working just as it should - I'll have to get back to you on the service part once I have an experience with their service (I'm hoping that will be a long, long, LONG time from now).
Lew Rothman does not like "high-end" cigars. He makes that VERY clear. In his view, they cost about the same to produce as a low end cigar so it makes no sense someone would spend the $$$ on a high-end cigar when they can smoke others more cheaply.
In a very simplistic view - that's true. If you have a roller making cigars, it takes pretty much the same effort and materials to roll a Opus as it does a Big Butt. But - it goes without saying that cigars like Opus are not rolled by just anyone at the Fuente factory and they're not using the same exact tobacco as their lower end cigars. "Pennies" in difference between one or the other? Perhaps. But also consider this... Fuente places a lot of pride in their Opus line. They wrap a better band around it (primarily, but the way, to thwart counterfeiters - imagine that!). They box Opus in a fancier box. The add "bells and whistles" to everything around an Opus. Still likely pennies on the dollar difference, but the differences now go from just a few pennies to upwards of a dollar or more. But wait - there's more!!!!
Next consider this... If Fuente was producing lower quality Opus (e.g. draw was not uniform, wrappers were not consistent, taste was not always similar, etc), would that Opus justify the price people were paying for it? I would suggest to you that their Quality Control costs associated with the Opus are subtantially more than the Curly Heads. Which means they're going to reject more.
Long story short. The Fuente factory manufacture a LOT of Opus X. But - they do not manufacture them in anywhere near the quantities of their lesser lines. Makes sense - I mean logically there are less available more highly skilled rollers, they're using the best tobacco Fuente (in much smaller quantities) they can get and putting them through a more stringent quality control process (rejecting much more finished product than standard runs).
Are they worth the extra money Fuente charges? I mean - I know an awful lot of folks that "hate" Fuente primarily because they think Fuente is doing some kind of marketing tricks with the Opus. Well - that's truly is the subjective part of all of this. Manufacturing costs aside, doesn't that really depend on where the buyer sits? We all routinely see places selling Opus WELL above even Fuente's suggested retail price! PEOPLE ARE BUYING THEM FOR INCREDIBLE PRICES (often above even Fuente's set retail pricing).
So why is that not true with a Big Butts? Why is Big Butt not selling for ungodly prices on eBay? If it's an issue of supply and demand pricing, why is Lew Rothman (and his counterparts) able to snatch up truckloads of Big Butts at dirt cheap pricing to sell in their "mega" cigar stores, but not Opus X? BECAUSE NO ONE WANTS BIG BUTTS EXCEPT THOSE LOOKING FOR A $2 CIGAR!
But back to reality. Is the manufacturers retail price of an Opus really that much more expensive than the rest of their lines? I would argue - dollar for dollar - value for value - cost of manufacture vs. cost of manufacture - they're really not that out of line. Cohiba vs. Quintero? Again - if you look at the "realistic" costs associated with factory to shelf (factoring out the "Lew" thoery), I don't believe you'll find the actual markup is as far apart as it may seem.
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