Djcxxx ... excellent question.
The Harmans, Paradigms and Focals have large low-end/lo-fi product offerings that presumably generate enough revenue to absorb a goodly portion of their fixed cost burdens. I've read on a number of other audiophile web sites that some companies have adapted to the current economic model by "ex'ing" out distributors and retailers by offering their products direct to consumers, e.g., Ohm and Von Schwiekert. This obviously knocks out distributor and retailer margins which add a sh*t-load to the end consumer retail cost.
Without having access to the "books," it's hard to know how "hobbyists" or small companies make it. Some do. Most don't for all the reasons I learned 45 years ago in Econ 101 and Management Accounting 101.
I'll say this. If R&D drives innovation, I question how small companies can really do it. The companies I mention above not only have extensive R&D operations, but they also manufacvturer many of their speaker compenents in-house. It should be no surprise that the companies listed above (and Magico too) use beryllium tweaters in their high-end gear. I suspect that many of the other "Big-Boys" don't because they can't.
