Originally posted by Marc Sabatella Anyhow, I'm not saying it isn't a shame that Hoya/Pentax found it necessary to raise the price on lenses. Obviously, it beats the alternative of Pentax going under. Whether there were *other* alternatives too, we really don't have the necessary information to know for sure, but I guess I don't see why people automatically *assume* that Hoya/Pentax is acting irresponsibly here, as opposed to simply doing the best they can with what they have to work with.
I've written this on other threads, and perhaps earlier on this thread. This is very important to understand.
Growing a business requires capital or cash flow. One or the other. Can't grow a business on ads and hope.
Capital, if available at all, is scarce and expensive right now (relative to inflation globally). Available capital flows to the highest Return-on-Capital option - which for Hoya is someting other than Pentax Imaging.
Hoya intends to grow Pentax (whether for eventual sale or as a "Brand Leader" consumer franchise) using
CASH FLOW FROM EXISTING PRODUCTS to finance development and distribuition of the next generation of products.
In a case where the entire development cost is completely recovered and there is no cost-accounting addition to "cost" to defray these expenses, such as FA50/1.4 and FA35/2,
the cash flow return by raising the prices to a "clearing level" is enormous - virtually 100%, to the extent that the lenses are drawn from existing stock and not actually manufactured [EDIT: there is significant conjecture that these lenses are no longer manufactured. That is not a known fact]. In cases of DA and DA* lenses where they are selling from stock the return isn't as great (they still must add back development costs), but it is still smart business.
New lenses, that are manufactured, have associated tax benefits of cost accounting, so "cash flow" is also quite good.
The art of using cash flow to fiannce future growth is knowing where to price, and what to manufacture versus what to draw down.
Pentax is reserving its (limited) future manufacturing capacity for
new products rather than "second runs" of existing lenses.
We (who already have our lenses) should be quite pleased that Hoya is behaving as if it wants to grow Pentax, rather than selling it off and letting someone else milk it and kill it.