Of Beer and Watches: Tell me why I am wrong.

You had me at beer 🍻

I do quite like your analogy. You're right that the auto industry doesn't work that well.

• You don't have hundreds of microbrand auto manufacturers

• Beyond that, there is no major supplier of workhorse engines - auto equivalent of ETA, Sellita, NH35, etc., though you do have major suppliers of transmissions in ZF and a few others

• Cars still serve a real world purpose, so that's out, as well

But, beer isn't quite right either.

• I think there's quite a nice parallel in terms of microbrews and microbrands, but it gets wonky real quick

• The microbrews are the expensive beers

• Meanwhile, microbrand watches are the cheap watches

• And, finally, the best-selling watch is wildly expensive relative to everyone else... it would be as though Budweiser cost $100 / bottle, while Sculpin IPA cost only $2!

I think if we were to find the ideal analogue, it would have to be another luxury goods industry. Handbags would be perfect.

• They're nothing more than anachronistic baubles used for signaling

• 99% of the price of the handbag comes down to branding

• The big players command the highest prices

• The microbrands command very little in terms of pricing as they're just doodads you buy at the farmer's market

The reason we don't use handbags as our go-to analogy, though, is because 99% of us here on WC are men, and we know nothing about handbags!

A similar story can be told of coffee. Coffee afficionados call this moment in its history the 3rd Wave, with the rise of specialty coffee -- single origin, micro lots, micro roasters, etc.

I think the alcohol industry as a whole better represents watches, beer doesn't have a real "luxury" end.

I think the microbreweries/microbrands thing works well, but higher end brands like Patek are more like Hennessey, Lagavulin, etc...

You can create your own premium whisky brand, but you'll be like CW or Monta, building a brand from the ground up.

I once built an analogy while hanging out with friends, between the pen industry (fountain pens being a personal rabbit hole), the watch industry, and the beer industry and compared what it was like to be a pen/watch/beer geek.

Some of the conclusions we collectively reached were around the handmade label not quite having the same impact in the case of beer but that the "we do everything in-house" had its own variation in each one.

We also agreed that there was a ranking of acceptability by "non-obsessed" people. A beer geek will likely receive some attention at a party. A watch nerd might quickly be classified as someone "with a problem" after the first few minutes. A pen enthusiast will send everyone screaming as soon as they open their mouth. 🙂

You are right, of course. "Hard" alcohol and beer are treated differently by our laws, so I would have to do more "explaining". Everyone loves when I do that. I think that folks from other countries would be surprised at the layers of laws surrounding the production and sale of alcohol, especially at the state level: state stores (PA), county stores (MD), retailers limited to three location in the state (SC). Setting up a brewery is much easier than setting up a distillery. In SC you can serve food at a brewery, so many microbrews function as restaurants and can profit from food sales. The limitations on distilleries were such that they could do a limited tasting (basically a shot) but could not serve food. So, distilleries were functionally package stores for sales. They changed that law last year.

To @Mr.Dee.Bater's point regarding luxury, I do think that there are luxury microbrands. F.P. Journe produces 800 watches a year. What exactly is that? In the watch industry all brands have sought higher ground: more profit on fewer watches. The beer industry forty years ago sought more profit through more sales for a cheaper product. They thought that we all wanted light beer. Their market surveys convinced them that Americans liked tasteless watery beers. Their direction was purposeful. The microbrews took the niche of fuller beers in different styles. The big companies produced weak lagers and pilsners. There are some brews who try to compete down market:

It is just a narrower space.

The microbrand business is predicated on the fact that Seiko and Citizen will sell their older designed movements in bulk. Seiko and Citizen are creating the microbrand industry at a level just below where they expect to sell their models. Alcohol doesn't have exactly that barrier to entry. You can ferment anything, but getting good hops can be difficult.

Regarding pens (@DocFrenchie), anyone with a lathe can produce a wooden pen and stick Pilot guts into it. They are all over festivals and farmers' markets. I own one. It hasn't been inked in a year. I am more of a Waterman guy, but this has been my daily for a month or more:

There are exponentially more watch geeks than pen geeks.

Very interesting discussion, I will throw one more into the mix that is going to fly like a lead balloon because the global pandemic really disrupted the trend of men wearing a proper suit most days each week to earn their dinners. A combination of computer technology and manufacturing in countries including China, Vietnam, India and a few more of the usual suspects gave rise to tailored clothing for guys who cared about traditional tailoring from Italy but were not about to put down 10k for a decent suit with Bemberg lining and bone buttons or buttons made from compressed walnut shells. The customer would take his own measurements often in the comfort of his own home according to detailed charts, list all the little details that makes a suit personal, a pattern is generated by computer, cut and finished by a combination of hand and machine finishing shipped to the customer in a few weeks time. I have not sampled the garments myself but have seen the results on many prodessionals still needing dress clothing. I met up with two young guys working real estate capital markets one time both wearing excellent Swiss watches and lovely suits made by computer and Chinese factory workers. My son in law wore a suit for the first time in his life when he married my daughter in a suit crafted employing that process. The wedding date,her name his name embroidered into the lining behind the collar should he forget or wish to share with guests. I will still buy a few watches from the brands that I love and if I need a suit it will not be one that I order from one of the new technology factories so the world changes but not so radically that the results are completely beyond the original.

In the 1980's my wife would travel to Hong Kong once a year. She would bring an expensive designer dress and have copies of it made in various colors very inexpensively. 150 years ago the Swiss did this with clocks, gutting the English and French clock industries. I think that I am going to order a smoking jacket from China (I don't smoke, but I need something to wear with my vintage watches and fountain pens).

A smoking jacket from China might not be inexpensive, lool! The Chinese around here view Canada as the new 3rd World, they buy everything not nailed down because the locals are desperate for their dollars, I am only half joking. I used to collect fountain pens sign as an affectation but the modern papers are often coated. When I was still doing the getting and spending I carried a gold Parker 75 that my dad had in his front pocket when he sweated buckets in hot greasy Chinatown kitchens earning pittance to support us. My pen was both a reminder to me and a mild caution to persons that I needed to engage in my profession.

Best,

J

Underwear.

I have my favorites.

I have my beaters.

I have the ones I wear several days in a row.

The ones I like to flaunt in public.

Some are dress style, some are divers.

😂🤣😂🤣

All the micro brands use movements from the big players and would be dead without their product. Any outlier would have to price themselves out of existence to design and build their own to scale because of R & D costs.

I like the analogy. I don’t know how it holds up in all details when scrutinized. But I like your writing, I like beer and I like watches. So I’m happy.