Margin on speaker sales by high end dealer

"The product cost is 12k and his gross profit is 8k, a 40% margin.
This is helpful to know."

Are you opening an audio dealership?

Great question. Most new sales average to 15% net profit in my store. I have to sell 2 million dollars to cover all expenses. Home Theater sales and installations lead to 10% net profit. 

What do you think retailers like Nordstrom and Macy's make?  You know this when they offer their 50% off sales.  A shirt selling for $100 suddenly selling for $50.  You can't tell me their cost is $45.  I am sure they are paying $25 which means their garments were not high quality to begin with.

I agree that just because you mark up something 50% means you cleared a $50 profit.  Merchants have to invest in their inventory, sit on it for possibly months and they have to pay for their rent and employee salaries.  By the time it is over, they would often realize a 20% net profit if lucky.  What I don't understand is how dealers cherry pick their inventory and assume a consumer would not spring for more expensive models.  It is their job to show the values of paying more to enjoy music longer term.  Consumers then turn around 2 years later, sell their gear for 50% on the dollar when they could have just been sold from the beginning what they will love long term.

I still think the way to buy gear is to attend audio shows to hear audio gear sold direct in order to get higher quality gear.  Manufactures do not have to pay for rent and pay sales people commissions so they can afford to manufacture their gear using higher quality components.  Most retailers simply do not stock a full line anyway so what purpose do they serve.  

good responses, hopefully the input from the knowledgeable folks on here have provided some clarity and education to those who need it about how the high end hifi retailing biz works ... it is a tough business for sure

some financial education is always a good thing