[John Stone]

On 4/22/10 4:52 PM, in article
, "Boon"
wrote:

�Low volume usually means a onesy twoesy man shop with no ISO-9000, no
product liability (not a big factor with speakers usually, though ones
with active power supplies could catch fire and of course Maggies
could fall over and hit someone if they fell apart), engineering costs
a one time consulting fee (i.e. they paid $500 for a Dick Pierce or
Joe d'Appolito half day consultation), etc. They are probably
manufacturing out of a back lot space in a "business incubator" or in
a defunct strip mall- or a suburban garage.

�Anyway, $200 in parts plus a cab means if you are paying two thousand
plus you are getting screwed. In my opinion.

One of the marketing formulas in audio is "times ten." Parts are
usually around 10% of the MSRP. That certainly doesn't mean your
margins are 90%, or even 50%. R&D, labor, advertising, shipping and
other fixed costs take a big chunk out of the pie.

Have you ever run your own business? Generally, businesses need to
make a profit, you know.

On 4/22/10 4:52 PM, in article
, "Boon"
wrote:

On Apr 22, 4:01�pm, Bret L wrote:

�Low volume usually means a onesy twoesy man shop with no ISO-9000, no
product liability (not a big factor with speakers usually, though ones
with active power supplies could catch fire and of course Maggies
could fall over and hit someone if they fell apart), engineering costs
a one time consulting fee (i.e. they paid $500 for a Dick Pierce or
Joe d'Appolito half day consultation), etc. They are probably
manufacturing out of a back lot space in a "business incubator" or in
a defunct strip mall- or a suburban garage.

�Anyway, $200 in parts plus a cab means if you are paying two thousand
plus you are getting screwed. In my opinion.

One of the marketing formulas in audio is "times ten." Parts are
usually around 10% of the MSRP. That certainly doesn't mean your
margins are 90%, or even 50%. R&D, labor, advertising, shipping and
other fixed costs take a big chunk out of the pie.

Have you ever run your own business? Generally, businesses need to
make a profit, you know.

Obviously he doesn't have a clue. He thinks Dick Pierce or Joe d'Appolito
will do crossover consulting work for $500. You can multiply that figure by
8-10X. He also leaves out the costs of crossovers, input terminals, wire,
fasteners, variovents, damping material, grille, documentation. Then there's
the little matter of shipping cartons and packing material. And never mind
the labor involved in assembly and testing. Given the cabinet design,
overall BOM costs on these has to be over $600, so I don't see these as
overpriced in the context of BOM cost to MSRP ratio. The simple question-to
be answered by the customer- is whether or not the design choices are
desirable at that price.