Keeping it alive.

Discussion in 'Product Availability' started by jamnut, Jul 23, 2005.

  1. jamnut

    jamnut Inactive

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    In the interest of keeping analog photography alive, I have a routine that I use which I hope will make a difference.
    My local camera store has a limited selection of 120 film and darkroom supplies; to obtain the stuff I like (APX, Rodinal, Neopan, HP5+, et al.) I must use web orders. To show suppliers that the interest is still there, I will rotate my web orders; one time I will order from Freestyle, the next time from Calumet, the third from B&H, etc. It's a little more trouble, but I hope to spread the wealth this way.
    Does anyone else do this? Will it help?

    Also, could someone explain a little economics to me? I thought that when a product or service is in high demand, prices for that product/service will rise.
    When there is little demand, the supplier will lower prices to stimulate buying.
    The demand for film and paper and chemistry is falling(?), so shouldn't the prices be going down also? They seem to be going up. Why?
     
  2. SuzanneR

    SuzanneR Moderator Staff Member Moderator

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    When the supply is low, and the demand is high, the prices should go up. When the supply is high, and demand is low, then the price should go down. Did I get that right?

    Seems to me, the supplies of b/w film and paper are getting lower, so the price is getting higher.
     
  3. srs5694

    srs5694 Member

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    I doubt it. Ultimately, it's all coming from the same sources (Agfa, Fuji, and Ilford for the products you mention). They're the ones who control the production (or lack thereof) of the products. What you're doing is just spreading the demand across different retailers. That might keep them all interested in stocking the stuff for a longer period -- or it might cause them all to dump sooner, compared to two retailers dumping it and one keeping on with it. (Of course, chances are your orders personally won't have that effect unless you buy a lot of supplies; I'm speaking about your strategy were it adopted by a significant number of photographers.) Personally, I wouldn't worry about where I buy stuff, aside from the usual concerns of convenience, selection, price, etc. If you like a retailer because they're more convenient, have greater selection, or whatever, take your business there.

    I'm not an economist, but it's not as simple as that. You've also got to consider economies of scale. For instance, suppose there are fixed costs of $10,000/day at a film production facility (for rent/mortgage, real estate taxes, security, etc.). If that facility produces, say, 1 million rolls of film each day, those fixed costs add $0.01 to the cost of the film. If the facility's output drops to 10,000 rolls of film a day because of decreased demand, the fixed costs add $1.00 to each roll of film, so the price will have to go up by $0.99 if the manufacturer is to maintain the same profit level per roll of film -- and much more if the manufacturer is to maintain the same absolute profit level. (These numbers are all just made up, so don't get hung up on them.) Similarly, it's usually cheaper for manufacturers to buy raw materials and other supplies in larger quantities, so as demand drops, material costs go up. Of course, if demand drops as dramatically as I've just suggested, the manufacturer is likely to close production facilities and consolidate production into fewer factories, assuming that's possible. That further complicates the analysis, but in the end, the principle of economies of scale is pretty simple: It's (usually) cheaper to produce something in greater quantities than in lesser quantities.
     
  4. Donald Qualls

    Donald Qualls Member

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    It's worse than that, though. If the manufacturer's cost to produce a consumer item goes up by one cent, the final retail price of that item will generally increase by something between ten and twenty cents -- because the original penny gets marked up by anywhere from 3 to 10 middlemen, each of whom price in their "costs" for changing the price as well as the actual increase in cost to them. This is why, for instance, a plastic camera that's cheap enough to give away with a roll of film still sells for $5 to $25 if you buy it separately.

    Otherwise, however, the economy of scale is one of the major factors in why falling demand results in higher prices -- because production must be reduced along with demand, or a manufacturer gets stuck with a bunch of product that can't be sold immediately and, in the case of film and such, will be impossible to sell after a certain time in storage (and meanwhile, those fixed costs are still running).

    When there's only film manufacturer left on Earth, film prices will be similar to those of glass plates now -- last I heard, the ones from Russia are $8/plate, sold in boxes of twelve. Sheet film could reach that price at some point -- but I won't be a photographer at that point, unless I'm making my own materials.
     
  5. MattKing

    MattKing Subscriber

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    The economic analysis here is correct, as far as it goes, but there are a couple of other factors that are particularly important to our interests.

    There are costs that are shared across several products, and that is where us lovers of MF or LF analogue processes are really suffering.

    Take the film base as an example. If memory serves me correctly, it is not manufactured in the individual film sizes. Instead, it is manufactured in wide rolls, and then cut to size (and perforated where required). As a result, when there was huge amounts of 110 and 126 film and 35mm film being used, each format benefitted from the economies of scale of the others. Even the larger formats, which may use thicker materials, benefitted as well, because the resources (research and development, raw materials, skilled employees, advanced machinery, dedicated buildings and physical plants etc.) that were used for the more popular formats, could often be used as well, with just minor changes, for the less common sizes.

    Unfortunately, with the market for the snapshot film sizes and snapshot development shrinking, the economies of scale are shrinking further. If they shrink past a certain level, products don't just become more expensive, they become financially impossible to produce. You cannot produce quality photographic film in temporary rented premises, with borrowed equipment, and part time or casual employees. You must have sufficient volume to maintain quality equipment, in suitable premises, and to keep fully employed the skilled technicians who actually do the work.