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30-11-2009
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As Sales Vanish, Skins Stay on Alligators (NYTimes article)
Unsure where to put this but NYTimes has an interesting article on the declining sale of alligator skins.

As Sales Vanish, Skins Stay on Alligators
By CAMPBELL ROBERTSON
Published: November 29, 2009

RACELAND, La. — After five years, Tommy Fletcher and his alligator farming business are facing irreconcilable differences.

“It’s like a marriage,” he said. “It was a bumpy road, and then all of a sudden it was over.”

The alligator industry makes for an odd mix of hardy men on the bayou who smoke Camels and drive crumbling pickup trucks, and Paris and New York fashion setters who consider it reasonable to spend $12,000 on an alligator-strap watch.

This peculiar relationship worked well enough for decades, but it has soured as of late. Last year Louisiana farmers, who produce most of the world’s alligator skins, collected over 500,000 eggs from the wild. This year, for the first time, most farmers did not pick up any.

The economy is the lead culprit. Since the fall of 2008, even wealthy customers have begun balking at the price of alligator skin products, which can range from the expensive to the wildly expensive. Bumper crops in previous years, people in the industry say, left an oversupply just as the luxury market began to falter.

But some farmers insist that the newfound frugality of the Gucci set cannot by itself explain the absolute washout of the alligator business. More than a few are beginning to blame the practices of executives in the European fashion business.

“How can this industry fall out so quickly?” Stephen Bonnecarrere asked while tossing live alligators into bins at his father-in-law’s farm outside Houma. “It happened too fast.”

Since the 1980s, the State Department of Wildlife and Fisheries has worked with farmers to maintain the state’s alligator population, estimated at one million to two million.

Alligator farming is hard, messy, costly work, and the lifestyle could not be further from that of the eventual Bergdorf Goodman shopper browsing for a pair of alligator skin loafers. Farmers, often in father-son teams, mark alligator nesting sites from helicopters, then go into the swamps by boat to gather the eggs, fending off mama gators with a pole. (By law, 12 percent of the grown alligators are returned to the wild.)

The landowners are paid for the eggs, and it is expensive to raise an alligator once hatched. The big ones — those that could end up as lavender handbags — tend to bite one another, making the skins worthless. So roughly 9 of 10 alligators reach their demise when they are only about four feet long.
Stolid men wade into shallow tanks and pull the alligators out by hand. Biting happens. After the gators are killed with a stab to the brain, they are skinned and sorted: heads and claws for the French Quarter souvenir shops, meat for the Cajun restaurants, guts for turtles, dogs or anything else whose tastes run that way.

For decades, the skins would be sold to 10 or 15 independent, often family-owned tanneries around the world that specialized in reptile skin, or so-called exotics. The prices were generally good, even generous. Some farmers, the ones that ran big operations, made millions of dollars.

The tanneries in turn would sell to the high-end fashion houses like Cartier, Hermès and Gucci, and from there the alligator would end up wrapped around someone’s wrist.

But things changed. In the mid 1990s, Hermès began buying tanneries and, as of a couple of years ago, became the largest player in the exotic tannery business.

Hermès bought aggressively from the farmers, and is still buying, though recently at prices far lower than in the past and lower even than the price of raising an alligator. All of this could be attributed to a very bad market. Luxury watch sales, on which the farmers are hugely dependent, are off by as much as 25 percent. But farmers look at the situation and say something does not add up.

While the tanneries are offering farmers little for their raw product, citing the recession, fashion houses are complaining about the astronomical prices for tanned hides. Many labels are giving up and moving away from alligator altogether, and well-known luxury brands like Manolo Blahnik say it is increasingly difficult to make a profit on such an expensive product.
“Every time I go to Neiman Marcus and say every year the price is going up, they fight me tooth and nail,” said George D. Malkemus III, the president of Manolo Blahnik. “They say, ‘I’m not going to spend $4,000 for an alligator shoe.’ ”

If alligator is still popular but is simply unaffordable, asked Zachary Casey, who until three years ago owned one of the largest farms in the state, why are thousands of the reptiles sitting unwanted in Louisiana? And why have prices for the raw product dropped so low? He says Hermès is hoarding the skins, forcing other fashion houses to pay dearly and leaving the farmers with few other options.

Caroline Schwartz-Mailhe, a spokeswoman for Hermès, said in an e-mail message that the company bought only about a third of the skins produced in Florida, Georgia and Louisiana, far from a monopoly. Ms. Schwartz-Mailhe added that the continued aggressive buying from farmers was a way “to support them in these difficult times and to respond to Hermès’ increasing development in alligator skins.”

Recent signs suggest that the luxury market is rebounding, at least somewhat. But some of the smaller farms simply will not make it.
Mr. Fletcher has been losing $15,000 a month on his little farm off the highway here near Raceland, about 50 miles southwest of New Orleans. He found a python and a loggerhead turtle and is considering opening a roadside zoo for tourists. But the plan of making it big in alligators, which once seemed like a good idea, has left him heavily in debt.

“I guess it’s like being married to Miss America,” Mr. Fletcher said. “You get all the benefits of the hugs and kisses, but she’s mighty high maintenance.”
nytimes


Last edited by lucy92; 30-11-2009 at 09:32 AM. Reason: Please dont include URLs as sources
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30-11-2009
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that was interesting. but what about the croc farms in southeast asia and vietnam etc? the story doesnt mention them and i just assumed that luxury brands were buying skins there.

i also wonder how many of these eggs are discarded or are even viable.

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30-11-2009
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i wonder that as well because the chinese alligator is an endangered species and well we all know many asian governments don't exactly follow protocol when it comes to protection.

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30-11-2009
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Even if luxury brands are buying more from Asian farms that doesn't explain why the retail prices are escalating. Surely, it would only make sense if retail prices were the same but tanneries and luxury good firms were buying less from American alligator farms.

Likewise, hoarding the skins only makes sense for Hermes (who will continue to use the skins). Because if hoarding is pushing firms away from using the skins altogether than surely it's pointless?

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30-11-2009
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^ i believe the designers make their prices based on what they think it worth (which is ridiculous), doesnt mean they should sell it cheap if they have them made cheaper, know what i mean

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02-12-2009
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interesting article but well the designer's croc items are ridiculous, people just can't or would not buy it anymore in this economical situation.
in asia crocs can still be purchased in way cheaper price, and yes, what i meant is the crocs from the hatchery, not wild animals hunted from the forest

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03-12-2009
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I read on bagsnob a similar thing happened to a farm in australia? A lot of skins come from south eat asia as well.

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03-12-2009
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thing is, luxury companies rarely if ever 'lower' their prices. even when the GBP dropped and buying Vuitton in London became cheaper than in Paris, the suits at LVMH decided to readjust the GBP prices. the prices CAN'T go lower, even if they spend less on raw material.

when the prices for the raw materials go up, the price for the end product goes up as well. if the price of the raw material goes down, the final price stays put, the companies then simply pocket the difference to pad their own wallets.

simple as that.

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