Re: TB depreciation?
- To: i*@Rt66.com
- Subject: Re: TB depreciation?
- From: t*@Lanl.GOV (Tom Tadfor Little)
- Date: Wed, 15 May 1996 13:29:17 -0600
Amy writes
:Say, for example, a hybridizer introduces a new TB hybrid. It
:sells for, say, $40. The next year, several Iris growers have
:that cultivar, except the price has fallen to say $25, etc.
:The price then "depreciates" over the years (unless it's difficult
:to divide, slow to increase, etc.) to a level of $3-$5.
:
:In order to DO this, the iris must increase. So if one purchases
:a brand new TB hybrid one year, for $40, how many potential
:rhizomes could one sell the next year? (I realize the cost
:of raising the iris is also a factor which is added into price.)
:I would think that there'd be at least two for every new hybrid,
:or else the price would never drop.
All very true. I like to think that every TB should produce 4 new
rhizomes in one year's time. For some, alas, it doesn't happen.
Your calculation only considers the supply, not the demand. A
popular iris will keep a relatively higher price, even if it
increases well, whereas a less popular one may be marked down
more quickly.
Newer irises (at least the ones from famous hybridizers) tend
to stay in high demand during the first five years or so, when
everyone wants an advance look at a potential award winner. So
you don't see the price drop from $40 to $10 the first year,
even though there may be 4 times as many rhizomes out there.
Also, I think growers realize it would be hard to sell brand
new intros if there was that kind of depreciation the first year,
so they will keep the price a little higher than strict supply
and demand would dictate. [Commercial growers on this list may
want to comment on this!]
The final price ($3-$5 in your example) for an old iris that is
not rare and not much in demand reflects the grower's costs in
water, labor, etc.
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Tom Tadfor Little tlittle@lanl.gov -or- telp@Rt66.com
technical writer/editor Los Alamos National Laboratory
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Telperion Productions http://www.rt66.com/~telp/
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