Twitter was divided this past weekend over the price of MaXhosa products. Some people say they are overpriced for a local brand whilst others argue that the prices are justifiable. Most people hold the perception that proudly South African brands must be cheap and this is a perception that needs to be fought at all cost.

Luxury brands in their nature are not designed for the masses, but for the selected few. The “So and Sos and the “Who’s Who” of the game. According to Kip Becker et al luxury brands have cultural and social connotations. Luxury brands such as MaXhosa have a symbolic meaning to the buyers.

There are various ways in which luxury is communicated to the consumer. Price is often an important aspect of luxury in the current socio-economic context; wealth is the only remaining consistent differentiator of social status.

To arrive at a specific price point MaXhosa has to consider these factors (but not limited to):

1. Expensive Material

The raw material used to manufacture the products. The raw materials that they use are expensive. In most cases, they use 100% pure cotton which is expensive. Also, where these raw materials are sourced does contribute to the price. If the raw materials are imported from Europe, they will be more expensive than if they are sourced locally. Sometimes the material are so rare and that has an impact on price. For example, most of MaXhosa’s cardigans are made using Merino wool which is expensive.

2. Labour

Labour is a major cost for any business and MaXhosa is no exception. South Africa is said to high labour costs when compared to other countries. This is due to the labour laws and the high involvement of trade unions. Unlike many brands who manufacture their products in countries that are known for cheap labour, MaXhosa is manufacturing their products locally.

3. Limited Production

Having too many products in the market can reduce the brand’s value. MaXhosa does not mass produce their products to capitalise on the economies of scale. In order to make a profit they need to charge higher for the product. Brands such Louis Vuitton suspend the manufacturing of the product once it reaches its sales target.

4. The Brand

MaXhosa is a brand with a powerful story behind it and a global footprint. Laduma has won a number of international awards including Pride of Africa at Africa Fashion Week Barcelona Awards. The calibre of the people who wear the brand. All of these things combined do contribute to the value of the brand.

5. Quality

As the adage goes, you get what you pay for. Luxury brands like MaXhosa put strict quality control measures to ensure that their customers get their money’s worth. The material they use to make the clothes are expensive as mentioned above. Sometimes it takes a long to come up with the designs. The difference between MaXhosa clothes and ordinary brands, for example, is they are more than just clothes, they are art.

The bottom line is that if you can’t afford it, it means you are not the target market. The people who are the target market hardly complain about the price.

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Pat Mahlangu

Thokozani Pat Mahlangu is the editor of Pat on Brands and the founder and CEO of Lerato Agency. He is internationally certified digital marketing professional and an Mcom Business Management graduate from the University of Johannesburg.

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