Quote Originally Posted by pbpersson View Post
Now......I thought that as non-traditional kilts became more popular, the prices would start to come down. Also, it appears more kiltmakers are appearing all the time.

Isn't UK going in the wrong direction with this?
Not at all.

The reason prices drop as something becomes more popular is because with a larger market, a company can increase production and in doing so increase efficiency. More efficient production lowers costs which allows for the dropping of prices. The prices don't actually drop however until competition forces it, or potential sales of lower priced items outweighs the profit made at the higher price.

Right now, UKs can't be produced fast enough to meet the demand, and they are trying to increase production. Since increasing production costs money, it makes sense to raise the prices to cover that cost.

In the long term, the price should go down, as long they reach a point where they can produce enough kilts to meet the demand, and make money on a cheaper product.


It's the same thing that's happening with the Wii. Both the competitors have dropped their prices, and it is getting to be well past the normal time frame for a price drop on a video game console, but they are selling faster than they can be built, so lowering the price would only hurt nintendo economically without increasing sales. Once production surpasses demand, then it will make sense to drop prices, but not before.