Is it possible for a high end manufacturer to overprice their goods?
Having just read the interesting and hyperbole laden review by RH of the new Rockport Orion speakers in the latest issue of The Absolute Sound, one thing struck me..
is it possible in the high end for a manufacturer to overprice their product ( doesn’t have to be a speaker, but this example comes to mind)? I ask this, as the Orion is priced at $133k! Yes,a price that would probably make 99% of hobbyists squirm. Yet, the speaker now joins a number of competitors that are in the $100k realm.
To that, this particular speaker stands just 50.3” tall and is just 14.3” wide…with one 13” woofer, one 7” midrange and a 1.25” beryllium dome ( which these days is nothing special at all…and could potentially lead to the nasties of beryllium bite).
The question is…given this speakers design and parts, which may or may not be SOTA, is it possible that this is just another overpriced product that will not sell, or is it like others, correctly priced for its target market? Thoughts…
I've seen dealer price lists from "high end audio" manufacturers. Particular segments have REALLY high markup, that doesn't seem to faze customers. Also have been exposed to the wholesale end of other high end consumer products. Nothing shocking comparing "high end audio" to other luxury products. Consumers with wide wallets will pay.
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The only Hi-end audio company is the Wavetouch audio. Everything else are Hi-Fi. They all are simply unlistenable to me. I watched few 2023 Axpona videos and my ears are in serious pain. My ears are much better after I listen WTPC video for few minutes. Alex/Wavetouch |
It’s amazing how many people are naive about the costs involved in running a business, let alone designing and building a high quality product. $100K+ speakers aren’t made in a garage over the weekend. _ _ _ _ _ Here are just a few considerations: - Manufacturing costs could easily be a minimum of $25K/month - most likely much more for larger operations. This would include: shop space rental, warehouse space rental (for both raw materials & finished products), CNC machine purchase, assorted power tools purchase, specialized handheld tools purchase, specialized electronics equipment, specialized software programs, multiple large work benches, etc. - Cabinet raw materials - Driver raw materials (probably modified) - Wiring and wire harness raw materials - Exotic paint and/or staining products - Separate paint shop space rental - Labor costs for skilled technicians: $50/hour X # of hours, X # of technicians. - Estimating profit margin needed to keep those skilled technicians on the payroll vs trying to find new qualified workers every few months and training them. - Monthly utility expenses. - Liability insurance and Comprehensive insurance. - R&D costs. How do you value thousands of hours by the lead designer? When creating something new, there is no formula. It hasn’t been made yet. - Cost of the prototypes. Those that didn’t work out - as well as the ones that came sort of close - but not good enough. - Attending industry events. Shipping the gear there and back. Hotel rooms, etc. - Website maintenance - Inflation: Price of everything going up. - and many other costs |
