Price Increases

I found Alan Taffel's article in this months Absolute Sound about the Swiss audio industry fascinating for its perspectives on the audio business and the business model Swiss industry has adopted. A point I noticed (relevant to this thread) was that when Cyrill Hammer of Soulution audio needed to remodel his electrical manufacturing firm and find a product that he could succeed with in Switzerland, he chose high end audio because of its relative insensitivity to price increases. Those of us without the living standards and purchasing power of the top 2-3% need to accept reality and realize that segment of the market doesn't care about price. If any given price tier product provides superior perceived value to their target demographic, they're adequately capitalized, and their marketing is successful, they'll have a chance to succeed in the marketplace. The vast spread of price points in the audio realm just reflects economic reality in the world. No point in beating up on businesses that try to go after the upper end consumer, they're just trying to find the product niche that works for them.

No doubt that most manufactures 'stick it' to us customers.

What manufacturer is forcing you to buy their products NOT including the government? If you don't like their products or policies, shop elsewhere.

Bigkidz, much of what you just wrote makes a lot of sense. I seem to recall reading an article authored by either Steven Stone or one of his colleagues (Robert Skoff?) that advanced the same points about the relationship of "hard costs" versus MSRP, particularly the points about dealer costs and margins.

Perhaps some A'gon members who are dealers can answer a question about one element of dealer costs, namely inventory. Just guessing about this, but I suspect aside from display and demo units, most dealers do not inventory large stocks of high-end equipment. That is not to say that the cost of display and demos is not significant. Consider -- how many Magico or Wilson speakers can a dealer be expected to have boxed in the back?? OTOH, aside from inventory, I imagine the cost of running a B&M store must be quite considerable, plus there is also the need to make a profit. Otherwise, we're talking about a hobby.

That's why buying preowned top end gear makes a lot of sense for me. I've bought most of my gear preowned for about 60 to 70 percent of MSRP. Having said that ... I won't and don't shop and audition gear in B&M stores. I have mentioned many times before that I won't take up a salesperson's time unless I intend to buy retail.

Cheers,

BIF

BIF I agree. The dealer I know very well offered to set up speakers that I purchased used. I cannot take up their time unless I am going to pay for the service otherwise I would feel obligated.

In the New World economy

Nothing really makes sense for example:

Well known American loudspeaker company (not telling) make a very well reviewed product known best for their powered towers company makes fantastic sounding product for the most part has a big advertising budget and designs everything in the USA but everything is made in mainland China EVERYTHING.

Interestingly all 12 of the drivers used in the now semi famous behemoth powered tower cost about 1/2 for just one driver found in a small stand mount speaker from someone else who's driver is made in Norway: Yep, roughly $360 wholesale for 12 drivers which includes 6 woofers 4 mid-band and and 2 Chinese made AMT drivers or 1 driver for $700.00 wholesale for 1 driver two are needed plus tweeters....

Moral is you can make a good sounding speaker that retails for 17K and is hugely profitable, sounds good, looks great, except for the excessive use of stamped steel baskets you believe your getting a fine item and your happy enough though in your belly your not really totally believing.

Bottom line it's about making money not necessarily about the love of the music; often 40K speaker is much more cost heavy in proportion than a great 10K speaker.

It's the new math.

If you don't care where it's made that's O.K. But don't laugh at the person of means that pays 250K for a hand built masterpiece that possibly only offers a slight bit of refinement in sound for the great cost.

Q