I might have told this story before. If so, forgive me:
While on a bus, touring France, my traveling companions and I stopped at a small café. We’d been sitting for three hours, so all twenty of us made a beeline for the toilets the moment we disembarked. Confronted by two stairways, one marked “hommes” and the other “femmes,” we split off according to our gender only to find ourselves reunited at the bottom.
“How French,” someone among us said. The remark provoked a ripple of laughter which somehow allowed us to share the single facility without too much embarrassment. Needless to say, the experience became a running joke for the trip’s duration.
My story illustrates a lesson. Differing names don’t guarantee a difference. Take eyewear, for example. Oh yes, I can tick off the labels of numerous brands, Armani, Prada, Gucci and Chanel, with their different prices. I can also point out that sunglasses and magnifiers are cheaper at a drugstore. What I can’t provide is information on the profit difference among them. That, according to journalist Sam Knight, is a closely guarded secret. Frames, he says, can sell “for 2 or 2.5 times their wholesale price.” Lenses can exceed cost by “700 or 800 percent.” (“The secretive firms behind your glasses,” by Sam Knight, The Week, July 20, 2018, pg. 37, reprinted from The Guardian.)
Surprisingly, the bulk of these lenses and frames come from one of two sources. Essilor, a French company, makes forty-five percent of the world’s lenses. Luxottica, an Italian firm, controls 25% of the frame market. Happily for both, an aging world population ensures their continuing prosperity, together with the growing myopia among the young who spend too much time in doors. (Click)
In March this year, the two companies merged to form EssilorLuxottic. Not yet a monopoly on eyewear, the combined company comes close. But will the merger affect prices? Will Gucci, that costs a fortune at the optometrist, cost less at the drugstore?
Like the steps leading to the men’s and women’s bathroom in France, the merged company is likely to result in many differences without a distinction. “What’s in a name?” Not much, except price, when it comes to glasses.