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Equipment Discussions >> Cats & Casses

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Jon Isaacs
Postmaster
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Reged: 06/16/04

Loc: San Diego and Boulevard, CA
Re: The plot thickens (Meade takeover) [Re: rmollise]
      #5944494 - 06/28/13 09:59 AM

Quote:

Quote:

We're going the way of the ham radio clubs in the age of the smart phone.

The idea of Meade disappearing has a sort of unreality to it, as though it could never really happen, and Meade will continue under some conditions or other.
But Unitron is gone; Jaegers is gone; Tasco is gone; Cave is gone. Some of the biggest names from when I seriously entered the hobby, are just history. We could actually lose Meade completely. And anyone thinking we'd be better off with a single source for SCTs isn't thinking very clearly.

IMO.




I don't know about club attendance...but amateur radio licensing is up. Way up. And, doom and gloom aside, there are more amateur astronomers today than ever. Meade is not on the rocks/rock bottom because there are fewer amateurs or kids are no longer interested in telescopes and astronomy (they still are), it's because of poor management decisions and bungled product introductions over the last seven years.






Schwinn went bankrupt because of poor management and because they were out of touch with cyclists and cycling, not because there were fewer cyclists or fewer people buying bicycles.

Meade has not had their fingers on the pulse of the amateur astronomer for quite some time. To see what has gone wrong with, I compare them to the company that was on the way up while Meade was on the way down: Orion.

Orion continually brings new and useful products to the marketplace. Intelliscope and Goto Dobs... Meade could have been there. ST-80's and decent but not expensive equipment.. ED-80s then ED-100s and ED-120s. And Orion products generally are not hyped for long periods before they hit the marketplace and when do arrive, they work.

Meade just got too ponderous, beholden to the stockholders rather than guided by a creative amateur astronomer, they sold poor quality scopes with lots of plastic at prices that could buy a serious scope... A $350, 114mm Jones-Bird on a shaky plastic mount... Honestly, I think Meade got what it deserved.

The pieces of Meade will be around in one form or another but I would not miss many of their lower cost stuff if it disappeared.

Jon


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RodgerHouTex
Pooh-Bah
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Reged: 06/02/09

Loc: Houston, Texas, USA
Re: The plot thickens (Meade takeover) [Re: rmollise]
      #5944497 - 06/28/13 10:01 AM

You hit the nail right on the head. Meade is going to fail because of inept business and marketing decisions. It's why I haven't bought anything from them in over 10 years.

Someone will step up to compete with Celestron. Meade certainly wasn't.


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Cotts
Just Wondering
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Reged: 10/10/05

Loc: Toronto, Ontario
Re: The plot thickens (Meade takeover) [Re: Starhawk]
      #5944513 - 06/28/13 10:09 AM

Quote:

It isn't complicated. Does your post make references to government officials? If yes, it's political. Let's get back on subject.

-Rich




Thanks, Rich. This sums up the TOS' political rule perfectly. The rule is in effect on all CN forums so moving this thread to the Off-Topic Forum or anywhere else wouldn't have made any difference. Questioning what is 'political' and what isn't doesn't help either.

Please, everyone, back on topic. (which, 99.9% of this thread we have been...)

Dave

Edited by Cotts (06/28/13 10:17 AM)


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ColoHank
Carpal Tunnel
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Reged: 06/07/07

Loc: western Colorado
Re: The plot thickens (Meade takeover) [Re: piaras]
      #5944546 - 06/28/13 10:32 AM

Quote:

The idea of buying the shares, although valid, would be very difficult to do. It is thinly traded on most days. The highest was on May 20 this year at +300k shares. Today June27th there was only 1800 traded. The number of outstanding shares is approx 1.31 million shares. Other then May 20th, it would take a long time to get a major position and get a seat on the board. It is too late and time does not stand still.





If Meade's been trading in the low single digits, then I suspect anyone willing to pay ten dollars per share could buy as many shares as they wanted or could afford. It probably wouldn't be a very sound business decision, but that's a way to take over a company.


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rmollise
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Reged: 07/06/07

Re: The plot thickens (Meade takeover) [Re: dawziecat]
      #5944598 - 06/28/13 11:08 AM

Quote:

The greatest obstacle to Meade's survival is right here! The CN forums!

They tell me Meade`s real money makers are the little Wal-Mart, department store scopes. Allowing that is true, and I don`t have the knowledge to dispute it, why is the company flirting with extinction?




1. There's no appreciable profit in selling cheap import scopes to Walmart. Never has been.

2. Even if there were, Walmart only sells them at Christmastime, and for the last three or four Christmases they have not done so.



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Madratter
Postmaster


Reged: 01/14/13

Re: The plot thickens (Meade takeover) [Re: ColoHank]
      #5944601 - 06/28/13 11:11 AM

I suspect anyone who really wants part of Meade is better off letting them fail, and then buying the particular piece they want on the cheap, without the encumbrance of all the debt the full company has accumulated.

My own view is that the Meade name is not worth much, and it would be just as easy to start from scratch lining up suppliers, etc.


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Starhawk
Space Ranger
*****

Reged: 09/16/08

Loc: Tucson, Arizona
Re: The plot thickens (Meade takeover) [Re: rmollise]
      #5944617 - 06/28/13 11:20 AM

No, this time I have to disagree. If you get the Walmart account, you're made. They have a low price, but they also tell you exactly where to get it made to make a healthy profit with them being sold at that price.

Losing the Walmart account was one of those things Meade desperately needed to un-happen.

-Rich

Quote:

Quote:

The greatest obstacle to Meade's survival is right here! The CN forums!

They tell me Meade`s real money makers are the little Wal-Mart, department store scopes. Allowing that is true, and I don`t have the knowledge to dispute it, why is the company flirting with extinction?




1. There's no appreciable profit in selling cheap import scopes to Walmart. Never has been.

2. Even if there were, Walmart only sells them at Christmastime, and for the last three or four Christmases they have not done so.






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Starhawk
Space Ranger
*****

Reged: 09/16/08

Loc: Tucson, Arizona
Re: The plot thickens (Meade takeover) [Re: caheaton]
      #5944645 - 06/28/13 11:37 AM

Ah, someone's been paying attention! This was actually mentioned pretty early in the thread. What could ES do with $5 million or more in investment? I'm guessing some pretty cool stuff. And there would be no old stories ranging from product flops to ugly law suits, stolen eyepiece designs, marketing overhype, and customer service abandonment floating around to try to live down. Thinking on it, doing that sounds so appealing, I'd think even if Meade assets/ IP were successfully acquired, it would make a lot of sense for what came out to be called ES.

-Rich

Quote:

One thing I haven't seen mentioned yet. If Meade were to disappear, Synta may not be left with a monopoly. It may well open a window for JOC (Explore Scientific) to expand their product offerings to include SCT's, etc. I wouldn't be at all surprised to see them step in and at least test the waters.




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rmollise
Postmaster
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Reged: 07/06/07

Re: The plot thickens (Meade takeover) [Re: Starhawk]
      #5944671 - 06/28/13 11:54 AM

Quote:

No, this time I have to disagree. If you get the Walmart account, you're made. They have a low price, but they also tell you exactly where to get it made to make a healthy profit with them being sold at that price.

Losing the Walmart account was one of those things Meade desperately needed to un-happen.

-Rich






Certainly you are free to disagree, but I can tell you for sure that is the way it is in the scope world. I can't speak about what it's like for folks selling two-handed combs or electric back-scratchers, but that is the way it is with telescopes.


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dawziecat
Carpal Tunnel
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Reged: 10/20/10

Loc: Rural Nova Scotia
Re: The plot thickens (Meade takeover) [Re: rmollise]
      #5944696 - 06/28/13 12:17 PM

I have no knowledge here. And I appreciate Wal-Mart make hard demands on their suppliers.

But I have read so often that the money in the telecsope business comes from the "department store" telescopes. The bigger, sophisticated instruments have always been "unprofitable."

Not so?


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bicparker
Carpal Tunnel


Reged: 02/07/05

Loc: Texas Hill Country
Re: The plot thickens (Meade takeover) [Re: rmollise]
      #5944704 - 06/28/13 12:21 PM

Quote:

Quote:

No, this time I have to disagree. If you get the Walmart account, you're made. They have a low price, but they also tell you exactly where to get it made to make a healthy profit with them being sold at that price.

Losing the Walmart account was one of those things Meade desperately needed to un-happen.

-Rich






Certainly you are free to disagree, but I can tell you for sure that is the way it is in the scope world. I can't speak about what it's like for folks selling two-handed combs or electric back-scratchers, but that is the way it is with telescopes.




Rod is correct and a careful review of the historical 10K's bears this out. WalMart and their other large chain accounts through which Meade sold discount telescopes never really made money. The margins were thin and the warranty requirements that WalMart imposed hurt Meade enormously. WalMart has actually lost several suppliers over the years because of how they aggressively shifted so much of the retail cost of sales to the suppliers.

Meade's premium telescopes, on the other hand, were quite profitable, but the revenue was getting consumed by the discount telescope sales' costs. Again, if you looked at Meade's financials during those periods, (and they had segmented reporting on these parameters, so this was easy to calculate) the premium scope revenues represented 2% of the sales volume (i.e., units), but around 20% of the gross profit. These were on gross revenue amounts of around $100-125 million. The disparity of those numbers were astonishing to me.

Anyhow, it really isn't an opinion, it all boils down to the numbers, and in this case, the numbers were pretty clear.


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faltered
professor emeritus


Reged: 04/01/05

Re: The plot thickens (Meade takeover) [Re: bicparker]
      #5944735 - 06/28/13 12:46 PM

Rod is absolutely correct on this. Having Walmart in this business only moves volume and builds the brand. Its not a profit center at all (in this business)

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jimb1001
sage
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Reged: 11/14/09

Loc: Florida
Re: The plot thickens (Meade takeover) [Re: Madratter]
      #5944772 - 06/28/13 01:13 PM

Are there really that many spectacular sights left in the night sky?

Perhaps where the skies are really dark (where there aren't that many people) there still are.

Where most people live, the sky at night is pretty washed out.

That's the reason for the rise of photography and video.

For us die hards, we're willing to put up with the extra complexity and cost, but most people aren't.

Sure, there are more people interested in astronomy than ever before. Heck, there's more than 3 times the number of people in the US now compare to when I was a kid. But as percentage of the population, that's shrinking.

The bottom line is that for most people with limited interest and a limited budget, its a tough hobby to commit to.

The result of all this seems to be that the upper end of the market is growing while the entry and lower mid level may actually be shrinking.

Not a formula conducive to mass marketers with not so deep pockets.


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Starhawk
Space Ranger
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Reged: 09/16/08

Loc: Tucson, Arizona
Re: The plot thickens (Meade takeover) [Re: faltered]
      #5944774 - 06/28/13 01:13 PM

I'm using the wrong words, somehow.

Let me try this way: The way the business plan was supposed to work, the mass sales of the cheap stuff were supposed to float the company. They spent a lot of money setting up production capacity to support that chain, and the money didn't come back.

What's happened here is weird, so explaining it isn't really that easy.

So, for a parallel example, Tasco made all of its money on consumer optics. When their consumer optics business went down, they were taking Celestron with them, because whether Celestron was doing well or not, it wasn't going to produce the wheelbarrows full of cash needed to keep Tasco healthy, and Tasco was spending all of its money on capacity to mass produce inexpensive consumer optics.

That's basically where this went. So, when people say, "But Meade wasn't in stores the last few Chrismases" or "Meade's data shows the cheap stuff wasn't earning much" both are 100% correct and are pointing at exactly what went wrong if both of those were true when the company was spending all of its effort preparing for the reverse.

-Rich


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Jon Isaacs
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Reged: 06/16/04

Loc: San Diego and Boulevard, CA
Re: The plot thickens (Meade takeover) [Re: jimb1001]
      #5944817 - 06/28/13 01:40 PM

Quote:

The result of all this seems to be that the upper end of the market is growing while the entry and lower mid level may actually be shrinking.




I think it is a mistake to think that Meade's problems are anything more than Meade's problems. Orion seems to be able to support the entry level and lower mid-level market. You spend $200 on an Orion scope and you are going to get a simple but decent scope with acceptable quality eyepieces and an acceptable finder and mount.

Meade has been trying to exploit those same markets but without the integrity to provide a reasonable scope for the money. In the beginners forum, when it comes to decent, affordable scopes, Meade is lacking.

You provide someone with a good quality first scope for their money, they'll be back. Provide them with a plastic mount with marginal eyepieces and they will go elsewhere if and when it's time for a better scope.

Walmart ... I really don't know but my guess is that a manufacturer who looks at it as an opportunity to connect with budding amateur astronomers and not as a way to make a quick killing can make it work.

The Nexstar102 GT that sold at Costco for $200 might be along those lines.

Jon

Jon


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bicparker
Carpal Tunnel


Reged: 02/07/05

Loc: Texas Hill Country
Re: The plot thickens (Meade takeover) [Re: Starhawk]
      #5944818 - 06/28/13 01:40 PM

I don't think it is that weird. Meade spent a lot of money trying to make money and they didn't. They made some decisions that ended up being bad in hindsight.

What hurt them the most was: 1) They lost two major retailers before WalMart due to bankruptcy, and 2) that they didn't correct their directions when the problems were already apparent. These two items were strategic and it hurt them permanently. During this time they did get at least one qualified auditor's opinion and so one has to think that the extent of situation was understood by management. Plus, the Tasco bankruptcy liquidation (chapter 7) was happening at this time, also, so most folks in the industry should have known what was happening.

Selling anything, and even more so discount anything to retailers that go bankrupt or cost you out of business never ends well.


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dogeddie
sage


Reged: 03/26/10

Loc: Wisconsin, USA
Re: The plot thickens (Meade takeover) [Re: bicparker]
      #5944857 - 06/28/13 02:01 PM

Say what you want about Meade. Yes, recently I believe their quality has slipped and their customer service is.....different. One one hand, there is always someone to talk to when you call customer service, which is nice. But I never get a feeling there is a deep knowledge of the product on the other end of the line.

I have two Meade scopes, an ETX 90 and an LX 90 - both are everything I want in a scope. But they were built around 2004 or so. Things were better then.

No matter how it turns out, I am unhappy that my choices may now be limited; or that one company will have a monopoly on the products for my chosen hobby.


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ken svp120
Carpal Tunnel


Reged: 12/19/04

Loc: Ohio
Re: The plot thickens (Meade takeover) [Re: bicparker]
      #5944867 - 06/28/13 02:10 PM

Quote:

... and 2) that they didn't correct their directions when the problems were already apparent...




Exactly. This whole situation would have actually taken place several years ago had they not gotten the $12,400,000 from selling Meade Europe. When you have a pile of money you can throw it at problems but only so long as the money lasts. Money's gone, problems still exist, game over.

I do not think Meade habitually had bad product. Maybe not the best, but certainly not the worst either. And their pricing was competative. So to me, this whole thing boils down to the incompetence of top management/leadership.


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cn register 5
scholastic sledgehammer


Reged: 12/26/12

Re: The plot thickens (Meade takeover) [Re: Starhawk]
      #5944868 - 06/28/13 02:11 PM

Could it be that the margin depends on who you are talking to?

I get the impression that for a dealer the large percentage margins are on the low cost items and the high cost items have a much lower margin. There's another thread where this seems to have been said.

However for the manufacturer it's different, the low cost items have a very low margin while the high cost items have a much higher margin. That's what seems to happen at work where we make scientific instruments.

Chris


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Starhawk
Space Ranger
*****

Reged: 09/16/08

Loc: Tucson, Arizona
Re: The plot thickens (Meade takeover) [Re: dogeddie]
      #5944914 - 06/28/13 02:38 PM

Those are both considered part of the high end, BTW.

Maybe part of this is we need new ideas and new products. To me that means less emphasis on making them curvy and more on things which are extremely practical, easy to use, and gosh darn it work well.

These are things ordinary folks wouldn't find intimidating. Right now astronomy is in the age of flashing 12 VCRs- most people just don't have the time to take to figure it out, whether they are capable of it or not.

And I seriously think something like a Food Network equivalent for astronomy is a big part of this- organic "You can do it, too" outreach. If you watch the science channel, it hones in on things like "Renowned astronomer Dr. X, who has spend a lifetime studying the arcane, can point an observatory telescope bigger than 5 tractor trailers parked next to each other at a point in the sky anything you could own would tell you was empty, and see amazing sights." Could there be any less friendly message for outreach? These programs simultaneously tell the audience they probably don't have the brains, education, commitment, equipment, or time to even touch the subject as anything other than the home TV audience.

The real amateurs I know personally come from all walks of life. The wonderful thing about the hobby is it really is possible for a fireman, medical equipment salesman, school teacher, traffic cop, musician, or engineer to meet in the dark and have a conversation everyone understands and enjoys. If everyone knew that, wouldn't more people do their own observing? And wouldn't it be better as a society to have people learning how easy it is to observe the sky with their kids instead of how to deep-fry a bacon stuffed chicken breast?

And that would allow us to have a more robust hobby.

-Rich

Edited by Starhawk (06/28/13 02:48 PM)


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