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General Asylum General audio topics that don't fit into specific categories. |
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General Asylum General audio topics that don't fit into specific categories. |
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In Reply to: RE: High Price posted by soulfood on February 24, 2015 at 04:36:50:
>>"Since even at entry level, there isn't a large pool of buyers, the mass market audio companies aren't really serious about jumping in (they >>are going for low volume/high profits - not what they do best)."
>>
>"Entry level" and "mass market" are used so loosely it's not clear what
>consumers and company/products are affected.
>>"And the rest is filled by small companies that operate on the low >volume/high profit model."
>
>Same as above for "small companies".
Let me clarify.
It is not clear there are as many consumers today that want to spend money on a stereo system as there have been in times past. Those that seem to be keen on it these days, typically would budget a few hundred dollars, not thousands. And of course a rare few (in shrinking numbers) are willing to spend thousands of dollars or more on a stereo system.
There has also been a jump in real price in much of this market space for a quality stereo.
And since there is lower volume, this is expected. I believe this is a function of lower sales volumes that has a number of impacts: 1) The companies best able to offer lower prices (such as Masushita, Sony, etc.) are playing a low volume/high profit game. 2) There are a number of small firms that MUST play the low volume/high profit game since their overhead absorbtion isn't anything like the larger companies in #1 (Even the larger of these firms such as the Harman Kardon Group, or Wilson Audio are a fraction of the size of the big boys).
>>"The distribution network is either antiquated (lots of middlemen making the original company take in 25-30% of the final price as income) - >>or it's confusing (buying a $2k component over the internet is not for the feint of heart)."
>I guess antiquated means, 'not good'. I would buy a new car over the internet if I thought it to be advantageous, rather than a model to lead >customers into dealerships.
Slightly negative, but it is also a function of a proliferation of small companies that cannot distribute their own product effectively the way a Masushita or Sony can. It is also the high margins in inerent in the system - which means the customer is going to pay more than with something with fewer middlemen or higher margins, and the producing company is going to get less. But it is the way things were done and have been done in the past and can only be supported with higher prices.
It is interesting that you mention dealerships of cars as another antiquated model. For a good example, compare the way Tesla wants to sell cars vs. the way it has been done for the last 100 years. Tesla's selling model is very low overhead and is driven from how they design, produce and service their cars. I will not pronounce one way or another as good or bad, but the benefits of the current way of selling cars accrue to the middlemen (dealerships and salesfolks) in a way they wont' with the Tesla Model - if it becomes normal, it will mean there is a whole host of new car salespeople that will have to find other work, which will make me a little worried, since the benefits of efficiency tend to be thinly spread.
====
"You are precisely as big as what you love and precisely as small as what you allow to annoy you." ~ R A Wilson
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Follow Ups
- RE: High Price - Bromo33333 15:08:29 02/24/15 (4)
- RE: High Price - soulfood 15:52:28 02/24/15 (3)
- RE: High Price - Bromo33333 09:22:05 02/25/15 (2)
- RE: High Price - soulfood 11:12:51 02/25/15 (1)
- RE: High Price - Bromo33333 17:37:53 02/27/15 (0)
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