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Posts: 7799
Location: Peoples' Democratic Republic of R.I.
Joined: April 23, 2000
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I was told some time ago by one of the major music software (LPs, SACDs, etc.) and audio hardware (turntables, digital front ends, amps, etc.) e-tailers that they could sell digital gear all day long at prices over $10,000; but at some point between $1000/pr. and $2500/pr., customer resistance to buying a loudspeaker they had not heard kicked in.
So, yes, of course, at least in the past, if a brick and mortar retailer had a pair of $10,000 speakers on sale, the arithmetic worked out something like:
Consumer pays $10,000 (ha ha ha! Almost never. Prices are higher to give the mandatory "sucker discounts").
Salesperson gets $1,000.
The dealer paid $6,000, so the dealer banks $3000 minus the discout.
If there is a sales rep, the rep gets between 5% and 10%, so, the manufacturer gets $5,000.
The manufacturer has to pay overhead and salaries and advertising and taxes and insurance. And bank a profit.
That leaves $2,000 for parts and labor, Non-Recurring Engineering Amortization, the boxes, packing material, owner's manual and warranty cards. In a "real" loudspeaker company, "labor" includes QC on all incoming subcomponents, as well as the final product.
So, for the $10,000 a pair speakers, how much is left for a pair of woofers and a pair of tweeters?
Let me be so bold as to suggest that a "real" company selling loudspeakers through sales reps and dealers, and which buys ads in the magazines and on the websites, and which exhibits at audio shows, cannot put $500 each Scanspeak Illuminator D3004/6640-00 1" Beryllium Dome tweeters and $367 each ScanSpeak Illuminator 18WU/4741T-00 7" Woofers in a "$10,000/pr." loudspeaker. Because those drivers eat up something like $1500/speaker pr. at wholesale, which means no money for cabinets and crossovers.
Assuming that I am not totally all wet, my educated guess is that the $10,000/pr. loudspeaker, after paying for cabinets and crossovers, there's $250 per speaker for drivers; let's say, $150 for the tweeter and $100 for the woofer.
That is why most loudspeakers have cabinets made out of sawdust and glue.
Which is also why the entry-level loudspeaker from Wilson Benesch costs nearly $9,000 a pair in the US.
But, most consumers don't want to buy from a one-man company whose global headquarters is half a suburban garage, and that goes double for buying direct. Years ago, someone taunted me over my enthusiasm for the French company ASA, asking whether I knew that it was two guys making loudspeakers in the garage of a private home, and presumably in violation of local zoning ordinances.
I replied that I had known that the company was two guys, and further that they just assembled known-manufacturer drivers into cabinets by subcontractors, but, the magic was in the voicing, and that the simplicity of the crossover enabled them to use a supremely expensive capacitor, and I thought that the Pro speaker was extraordinarily good, and that the Baby speaker committed only sins of omission, and was something of a bargain.
That person chided me for misleading my readers and risking that they would own "orphan" products. My reply was, "Oh? Is Dynaudio going out of business?"
That was at least 25 years ago.
And, ASA is still going strong, but not in the US... the Pro Monitor that was US$5000/pr. 20 or more years ago is now circa 12,000 Euros/pr.
A funny business, indeed.
jm
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