Quoted from Dooskie:Have you ever used a temp agency to get employees? It's not a cheap way to hire labor.
Correct: I use a temp agency for some of my staff, and depending on the circumstances, the markup can be anywhere from 25% to 40%. I would love to just hire direct, but my contract with the Govt. requires I employ contractors that are hired by minority based companies. The cost is ultimately passed along to the end customer.
Quoted from Dooskie:If you don't like the price, if you can't afford the price, quit whining about it and do something about it.
Oh I can afford it, but the value just isn't there at the new pricing levels. So I am doing something about it. And I don't think it is just that I am bitching about prices (I am), I'm also letting the manufacturers know why I'm not buying their games anymore. It is the only action I can take as a consumer, I stopped consuming. If the price I was willing to pay for games at the beginning of this year were not high enough to stay in business, they are in the wrong business.
And I still realize my few games here and there don't amount to anything for them. Stern will never notice DaveH didn't buy a game. But there are enough people who feel the same way. This pricing experiment is over for me. And a ticked off customer is never a good thing, because once that line is crossed going back to where it was doesn't just bring those sales back.
Quoted from Grizlyrig:Agreed but now you are not responsible for unemployment taxes,workers comp,medical insurance,...you can see where I am going with this.
Mike
Sure you are. Anything that is required to be paid is figured into the overhead, along with the temp agency profit. they don't do it out of the goodness of their heart.
The one advantage to temp labor is ....well...they are temp. You can add or remove as you go, and you don't have to jump through hoops to get it done. You still have to follow Federal law, and those laws are being interpreted differently these days to give the worker more and more benefit.
Building pins is not lucrative. The latest pins have really cool features, but with that has come higher price. I believe at this rate, higher costs will outstrip the 'cool' factor and we will have a temporary collapse. Spooky seems to have a handle on making relatively straightforward, affordable pins while keeping costs low. There is not a lot to their pins, but they are still fun and affordable. I can't imagine there is enough money for a serious manufacturer to stay in this industry. It is going to be the hobbyists who are self reliant and can control costs that keep this industry going.
Quoted from zacaj:Come up with a single way in which Stern *might* have higher costs than JJP. I can't. JJP seems to be higher quality, more complex, more detailed, better QC, etc, etc. Where exactly are they doing anything cheaper than Stern is?
Yeah sure, unless you have the actual spreadsheets you can't 'know for sure', but there isn't much you can. There isn't a reasonable doubt that I can see.
Depends on their finances or any other number of variables. We have no idea how far Stern or JJP are leveraged, and by whom? The worse off you are, the more borrowed money will cost you. Stern could be up to their eyeballs in debt for all we know, as they aren't publicly traded. We know JJP took on investors, but did he just give up a piece of the pie? Or are they demanding a guaranteed return? What is property worth in NJ compared to Chicago? Do they own their property or rent? Any court judgments against either of them? There are any number of a million different variables, and without the books in front of us, there is no way of knowing anything.
Quoted from zacaj:Come up with a single way in which Stern *might* have higher costs than JJP. I can't. JJP seems to be higher quality, more complex, more detailed, better QC, etc, etc. Where exactly are they doing anything cheaper than Stern is?
Yeah sure, unless you have the actual spreadsheets you can't 'know for sure', but there isn't much you can. There isn't a reasonable doubt that I can see.
Employee costs. Rent. These are two of the biggest costs for any company, and I am pretty sure Stern's are easily higher than JJPs. And while I agree that JJPs BOM cost per machine is higher than Sterns, until Batman '66 every single Stern model was lower in price than the lowest price JJP. The normal Premium level machine (GB for example) is $1000.00 less than a "standard" JJP. Stern pros are $2000 cheaper. Batman '66 pricing is because it is a "boutique" release, and the next cornerstone Stern machine should be closer in pricing to where GB is (I hope).
Quoted from Dooskie:I am sure the information is available, and a company shouldn't be hesitant to answer a question like this.
Of course a company should be hesitant to answer this. Stern is a privately held company. Their financials are no ones business. They also don't need to justify their pricing to anyone other than their own shareholders. Don't like the prices, don't buy.
I don't recall people, out of the goodness of their hearts, offering to pay Stern more for their machines when they were barely scraping by and about to go out of business. "Hey Stern, as the last pin manufacturer standing, can we help you out for love of the hobby?". Now the market is hot, and they are riding it for all it is worth. Make hay while the sun shines and all that.
I am with you in that the prices are now too high for me, cannot justify it, but doesn't change the fact Stern and JJP can charge what they want and if enough people are willing to pay, that's the way it will be.
Quoted from Dooskie:Bottom line is this: I just wish people would think a little bit more before they start trashing a company about their pricing. I wish people understood business a little bit more, and what it takes to operate a business. I'm not sticking up for Stern, JJP or anybody else. But people are so hung up on prices, and thinking they are getting ripped off. If you don't like the price, if you can't afford the price, quit whining about it and do something about it.
I agree with most everything you have said, and in a free market, there is no reason they can't charge what they can get. The consumer will hopefully set the ceiling.
But I think people are confusing complaints about normal price increases with outright money grabs and taking advantage of people wanting to be one better than the other guys in their league. Cost of material and labor goes up, and we can't really say for sure if the recent base model price increases are necessary to keep the doors open or not. We just don't know....we can guess, but we don't know. I run and office in Chicago, and I can tell you that every bill I get these days seems to have jumped 15 or 20 percent from last year. It is an expensive place to do business.
But consider this.....Stern would not make 240 Batman LE's at a loss. So we know they are making a profit....we just don't know what that profit is. But then they put out 30 SLE models at 5K higher price, with what has to be less than $500 a unit difference in materials. Money Grab=yes, but at 30 for very good customers, who really cares. Then they decide that wasn't enough, and because there were more folks standing in line with cash, they decided to change the original number to 80, and that really has greed written all over it.
Same with JJP....he is no dummy, he saw what Stern was doing and decided to jump onboard. Again, he is making money on his base model, but what is the first thing he says?? 7,000 LE's.........now granted, that has changed to 2,500, but the greed oozed through on that one as well. I think that is what most folks are complaining about. Then they tell us the costs of production have gone up and they need to increase the base price.....how are we now to believe that, given what they just did?
Quoted from BoJo:You have one Stern and no JJP games so maybe the increase in pricing effects others more then yourself. There are some people who buy every new game and been doing it for years. So they are not allowed to whine about pricing but you are allow to create a thread whining about them whining?
I am lucky to live in a country where I am 'allowed' to have an opinion. I've got two Sterns, four Williams and two Data East games. My collection is puny compared to most that hang out on Pinside. In your eyes, I'm sure that doesn't 'allow' me to have an opinion. As far as the prices affecting people, either pay it or don't. The manufacturer(s) will respond as they need to. But people go on and on and on and on and on about the price, when most do not have a clue or business sense to know why things cost what they do.
Quoted from Manimal:I agree with most everything you have said, and in a free market, there is no reason they can't charge what they can get. The consumer will hopefully set the ceiling.
But I think people are confusing complaints about normal price increases with outright money grabs and taking advantage of people wanting to be one better than the other guys in their league. Cost of material and labor goes up, and we can't really say for sure if the recent base model price increases are necessary to keep the doors open or not. We just don't know....we can guess, but we don't know. I run and office in Chicago, and I can tell you that every bill I get these days seems to have jumped 15 or 20 percent from last year. It is an expensive place to do business.
But consider this.....Stern would not make 240 Batman LE's at a loss. So we know they are making a profit....we just don't know what that profit is. But then they put out 30 SLE models at 5K higher price, with what has to be less than $500 a unit difference in materials. Money Grab=yes. Then they decide that wasn't enough, and because there were more folks standing in line with cash, they decided to change the original number to 80, and that really has greed written all over it.
Same with JJP....he is no dummy, he saw what Stern was doing and decided to jump onboard. Again, he is making money on his base model, but what is the first thing he says?? 7,000 LE's.........now granted, that has changed to 2,500, but the greed oozed through on that one as well. I think that is what most folks are complaining about. Then they tell us the costs of production have gone up and they need to increase the base price.....how are we now to believe that, given what they just did?
Sometimes you have to cost-average to keep your overall margins in line. You pump out a base line that you're going to sell more of at a lower margin, an LE line that you're going to sell (a lot) less of at a higher profit. No different than car manufacturer's (yes, I know some of you hate comparing pb machines to cars). But also keep in mind, the LE's do have extra features. There is a cost to build those. A separate assembly line has to be set up, extra (and different) parts have to be bought and inventoried. Labor has to be factored into that as well. I doubt they are making as much as you all think they are.
But again, all of this is conjecture. From everyone. Nobody here really knows, do they?
Lots of people here assume a 'cost plus' pricing model and think it's the only fair way to do business. A value-based pricing model is what Stern and JJP appear to be using and is better for the health of the companies.
Quoted from Cserold:This times 1 million....we live in a culture of entitlements and handouts so not surprising. What ever happened to free markets, capitalism and a company's right to try and make as much damn money as they can....
The investors and principles of all of these companies deserve to be handsomely compensated for the risks they have taken and the intellectual property they are producing...and I hope they are. If they out price the market then they will suffer badly and then you can take satisfaction in that.
So out-price your main market until it hurts, then dial it back to just inside the "safe zone" before the "breaking point" ?
That's what I got out of that. Sounds like Disney World price strategy to me: Put it just on the edge of "hell with that" but still attainable.
Quoted from Dooskie:But also keep in mind, the LE's do have extra features. There is a cost to build those. A separate assembly line has to be set up, extra (and different) parts have to be bought and inventoried. Labor has to be factored into that as well. I doubt they are making as much as you all think they are.
What ever happened to make one machine? That seemed to work fine for....how many decades? Sure, there was a TAFG machine, but that was a manufacturing milestone opportunity; it wasn't a "hey, we all know you'll pay it so suck it" moment....
This is partly OUR fault. Some people have to have special snowflake machines and have something more "oo ahh" than the fellow pinball player down the street, and Stern answered that call. Now potentially by reasons you cited, we ALL get to pay for that.
In my mind, ACDC is where that all started. Yeah, there was LOTR and Avatar, but ACDC is where the tier system kicked in hard, and the price increases never seemed to stop after that. Think it's coincidence that the tier system showed up and prices started going up a crazy amount at the same time...?
Quoted from NPO:What ever happened to make one machine? That seemed to work fine for....how many decades?
Yep, worked great! Williams got out of pin manufacturing because more money could be made elsewhere, and then a few years later Stern almost went out of business. Ah, the good old days.
Quoted from Dooskie:But people go on and on and on and on and on about the price, when most do not have a clue or business sense to know why things cost what they do.
That's pretty ignorant to think none of the people on here have the business sense to understand why things cost what they do. Guess you have to own a golf course to understand
Quoted from TVP:Stern's cost for making a pinball game today is cheaper than 5-7 years ago.
I'm curious what facts you have to base that on. I'm not saying that you aren't correct, I'd just like to know how you arrived at that conclusion.
Quoted from Dooskie:My guess is that it ain't cheap, and that under any normal business model, a $7,500 to $10,000 price range is well within being reasonable.
Do you think Stern was selling pins at a loss for $3700 a few years ago?
How does Spooky manages to sell pins for $5300 (Domino's Pizza) or $6k (RZ) for relatively low runs? - Economy of scale between hundreds of parts (Spooky) and thousands (Stern) is far from negligible.
Quoted from BoJo:That's pretty ignorant to think none of the people on here have the business sense to understand why things cost what they do. Guess you have to own a golf course to understand
There's a difference between 'most' and 'none.' Before calling a person ignorant, it might not be a bad idea to read what they actually wrote. Otherwise, the label you are trying to attach to them might end up getting attached to you.
I love all this outrage over prices and blaming Stern and JJP for being thieves when we are the ones dictating the high prices in the first place, stop buying them, you know I see it in the used market as well, people asking 2 and 3 times what pins were selling for 3 to 5 years ago so why not the NIB market? If a used game comes up for sale lets say IJ for 6500 and no one buys it then you know what will happen? exactly. 
Quoted from Dooskie:There's a difference between 'most' and 'none.'
My apologies since you are only insulting the majority of Pinside but not everyone.
Did everyone forget the cost of Stern and JJP paying their trolls to read pinside forums 24hrs a day to warn them of the upcoming pin revolution ...that's a major concern..and cost
Quoted from jlm33:Do you think Stern was selling pins at a loss for $3700 a few years ago?
How does Spooky manages to sell pins for $5300 (Domino's Pizza) or $6k (RZ) for relatively low runs? - Economy of scale between hundreds of parts (Spooky) and thousands (Stern) is far from negligible.
Dont get me wromg i appreciate more pins and companies with cheaper options but have you seen a spooky pin up close and inside and out? There is a reason they are able to keep the price where it is . They are getting better with every title and are comparable to stern pros imo but they are over 1k more than say met which is much better game. Im hopeing the next title is really awesome
Quoted from zacaj:We are doing something. We're pointing out that we're being ripped off, and trying to get them to charge more reasonable prices before they hurt their image too much.
In what sense are you being ripped off? You're not being forced to buy these games. It's not like car insurance that you are required to have. Don't like the price? Go somewhere else and vote with your wallet.
Quoted from paul_8788:Yep, worked great! Williams got out of pin manufacturing because more money could be made elsewhere, and then a few years later Stern almost went out of business. Ah, the good old days.
Oh please. Williams was around for 60 years. That's longer than some people on earth will live.
And Stern stuck around and held on through "the barren wasteland" years, making some pretty packed pins. TSPP and LOTR were not exactly Avatar playfields...
Without going on too much of a tangent, I don't feel your comment really holds much merit. The "golden years of pinball" didn't have tier systems to support it. That's a market strategy that Stern latched onto, and we have nearly all bit on it - myself included.
Quoted from DaveH:Oh I can afford it, but the value just isn't there at the new pricing levels. So I am doing something about it. And I don't think it is just that I am bitching about prices (I am), I'm also letting the manufacturers know why I'm not buying their games anymore. It is the only action I can take as a consumer, I stopped consuming. If the price I was willing to pay for games at the beginning of this year were not high enough to stay in business, they are in the wrong business.
And I still realize my few games here and there don't amount to anything for them. Stern will never notice DaveH didn't buy a game. But there are enough people who feel the same way. This pricing experiment is over for me. And a ticked off customer is never a good thing, because once that line is crossed going back to where it was doesn't just bring those sales back.
THIS! X100000 billion. Add in sterns continued lack of code commitment, and the consumers who have been supporting them for YEARS are going to look the other direction when it comes to absurd price increases. Us veterans have warned the rookies of whats going on here, if the rookies still want to take the hit, by all means go for it.
Quoted from taylor34:The old factory produced 32 per day. I'm sure they're no where close to 100 per day, they're not producing 24,000 machines a year, lol.
On our Stern tour this year Dwight said the new location could produce up to 125 pins a day over the two assembly lines, but that they have never done that yet or even got close. He said the most they have done was 75 and that was a single day number that wasn't maintained for consecutive days. They only produce pins 5 days a week too, nothing on the weekends or overnights, just normal business hours.
Quoted from Dooskie:I'm curious what facts you have to base that on. I'm not saying that you aren't correct, I'd just like to know how you arrived at that conclusion.
Their cost to manufacture almost every component of the pinball machine (cabinet, decals, trim, power system, boards, wiring) is lower today.
That's why they come out with new platforms like spike. The can add more horsepower and programming flexibility at a lower manufacturing cost. They manufacture that platform on over 100k machines and their margins increase dramatically compared to how they manufactured the machines in the past.
Stern is making more money now than ever before. Anyone who can't see that has blinders on.
According to Roger Sharpe licensing costs are less than $100 per game. They have to cover the licensor’s expenses: legal, approvals, asset acquisition as well as other business related costs so the licensor doesn't lose money. Pinball is considered "sexy" and desirable which may explain why it is relatively cheap to acquire licenses.
"OK, but how about some real numbers. Some people have talked about per-machine licence payments of $100 to $500. How realistic are those figures?
Sharpe says they are definitely on the high side. “$100 per machine? I have never done a licence at that figure for a pinball machine,” he says. “The profit margins just don’t make sense. All the licences I have done with pinball are for far less. I would find it hard to believe that either Stern or Jersey Jack would ever commit to spend $100 per game.”
http://pavlovpinball.com/pinball-licencing-101-how-much-why-and-harry-potter/
On the other hand it can take 1 year and $1 million to design a pinball machine. That's real money.
Regulation in running a business today is adding major costs to the bottom line price of all items we buy. It's one of the main reasons you see so many companies moving their manufacturing operations out of this country. Not trying to be political, it's simply a fact and has been happening for 20-30+ years regardless of which party is in charge of "running" the country.
It most certainly costs more to produce a game than it did 8-10 years ago. In general you'd like to think people are making more per hour than they did back then but in many cases any gains they are making in hourly wages is getting hammered by the increased costs of health insurance, for both the employee and the employer. (Usually employers pay a pretty high percentage of the health insurance costs) Then add in worker's compensation, social security, federal, state and local taxes (which in general are going up not down) all adds into making it more expensive to produce the same product as you would have years ago.
Also distributors need to make a few bucks on the games as well and usually what they pay for an item is a fixed percentage of the MSRP (at least that's what it was in the wholesale fields I worked in years ago), pinball may be different but I highly doubt it. So as costs go up to manufacture the games, the manufacturer still wants to make at least the same percentage profit per machine, not the same dollar amount per game. So do they make more per machine? YES, that naturally will happen as costs rise. However, this also means it raises their costs to the distributors along with the MSRP.
So prices should be higher than they were in the past 8-10 years, but they have inflated at quite a rapid rate. I've only taken the plunge and bought new once and that was from MMRLE. Even at that price it was a stretch for me personally and I can't imagine I will ever be doing that again. Especially at the rate games keep climbing in price. 10K plus for a new game? No thanks. I'll gladly buy used.
Quoted from Dooskie:Sometimes you have to cost-average to keep your overall margins in line. You pump out a base line that you're going to sell more of at a lower margin, an LE line that you're going to sell (a lot) less of at a higher profit. No different than car manufacturer's (yes, I know some of you hate comparing pb machines to cars). But also keep in mind, the LE's do have extra features. There is a cost to build those. A separate assembly line has to be set up, extra (and different) parts have to be bought and inventoried. Labor has to be factored into that as well. I doubt they are making as much as you all think they are.
But again, all of this is conjecture. From everyone. Nobody here really knows, do they?
Again, I would agree with you except one would have thought that would have all been worked out before announced prices and quantities. Then when they saw the response....everything changed.
Quoted from zacaj:Come up with a single way in which Stern *might* have higher costs than JJP. I can't.
1) larger facilities
2) a lot more employees
3) multiple titles being developed
Quoted from NPO:Oh please. Williams was around for 60 years. That's longer than some people on earth will live.
And Stern stuck around and held on through "the barren wasteland" years, making some pretty packed pins. TSPP and LOTR were not exactly Avatar playfields...
Without going on too much of a tangent, I don't feel your comment really holds much merit. The "golden years of pinball" didn't have tier systems to support it. That's a market strategy that Stern latched onto, and we have nearly all bit on it - myself included.
Williams. Yes, they were around for 60 years, but got out of the business almost 20 years ago. Not even sure how this is relevant to a discussion on the pinball market today, it is obviously much different. It is no longer the "golden years of pinball".
Stern almost went out of business with their one tier model. They had to bring in outside investment. Something had to change. I am sure they could've stayed with one model, maybe something like the "Premium" level, at that price point, but they chose to have a more affordable "Pro" level for operators, as well as an LE for enthusiasts. It is working, they are making money, the hobby is expanding, so I think it is here to stay.
Agree with me, disagree with me, doesn't change reality.
if the cost (to buy) of a pinball machine was under 4k or 6k for a premium/le a few years ago, how come it has double or triple today?
i doubt parts went up 300%, cost of lcd vs DMD and new system cost a lot less and they buy in bulk.
what's the cost for them to go from pro to premium/LE? adding a few matchbox/cheap look a like toys and new color trims, a plate # (again in bulk). a few hundreds? but price difference is crazy and people line up to buy it like it's the next best thing.
Quoted from beatmaster:if the cost (to buy) of a pinball machine was under 4k or 6k for a premium/le a few years ago, how come it has double or triple today?
i doubt parts went up 300%, cost of lcd vs DMD and new system cost a lot less and they buy in bulk.
what's the cost for them to go from pro to premium/LE? adding a few matchbox/cheap look a like toys and new color trims, a plate # (again in bulk). a few hundreds? but price difference is crazy and people line up to buy it like it's the next best thing.
Someone buys a Tron LE for 6k or whatever it was. Fast forward a year or two and it is selling for 11k on the secondary market. Means people exist who will pay more for the machine, so the company feels like they left cash on the table. Increase the price, see what happens, rinse and repeat.
Quoted from JJHLH:According to Roger Sharpe licensing costs are less than $100 per game. They have to cover the licensor’s expenses: legal, approvals, asset acquisition as well as other business related costs so the licensor doesn't lose money. Pinball is considered "sexy" and desirable which may explain why it is relatively cheap to acquire licenses.
"OK, but how about some real numbers. Some people have talked about per-machine licence payments of $100 to $500. How realistic are those figures?
Here are the leaked numbers from Sony that show how much Stern paid to them for the first run of Spiderman:
Quoted from PanzerFreak:Stern is just playing mind games at this point by trying to reach the breaking point when customers finally stop buying their games.
And apparently we are not there yet. Insanity
Quoted from Dooskie:I agree, temp work....no work for them...send them home. However, there is a cost involved with that as well. It takes time and money to train an employee. With temps, that is a cost you have a difficult time ever recovering. Training people is expensive.
not true. the temps at stern don't speak English. I know I tried to speak to them. Don't think they are us citizens. so there not paying taxes, not on sterns payroll, no work mans comp, no benefits, so they can hire multiple "people" for one job. better then it would cost one employee at fair wage.
Quoted from cavalier88z24:not true. the temps at stern don't speak English. I know I tried to speak to them. Don't think they are us citizens. so there not paying taxes, not on sterns payroll, no work mans comp, no benefits, so they can hire multiple "people" for one job. better then it would cost one employee at fair wage.
That is ludicrous. First off, maybe they just didn't want to speak to you. Second, our tax roles are full of non-English speaking immigrants. Most of the folks that built this country didn't speak English for at least a generation, and saying they don't pay taxes because they don't speak the language is a really "uninformed" statement. You don't have to be a citizen to pay taxes. Anyone on a work permit, working for a legitimate company, is paying taxes. I have several immigrants who are not citizens on my payroll, and for the record, they pay as much or more tax than most of my "citizen" staff. Temp workers are not the cheap labor source you think they are. You not only hire them, but you hire the company they work for.
The only ones that get away without paying are illegal day-labor types, working for crooked companies, and that is NOT who Stern employs. People think just because they are immigrants, that they are feeding off of the system, and I am here to tell you, I see 10 times the abuse of our system by home-town folks, than those coming here to try and make a better living for themselves and their families. These folks know poverty, hard work, and value and have the humility I wish many of us still had. We are worried about the cost of a $9,000 pin, and many of these folks are wondering if they can afford heat this winter.
For the record, I hate using contract labor, but it is a requirement in the contracts I have. They are just as valuable employees as any of my others, which is why I voluntarily provide them with the same benefits my other employees get. I just do it in a way so it does not become a guarantee. As a result, I have almost zero turnover, great employee loyalty, and good morale......all from non-English speaking folks who indeed do pay taxes.
Quoted from moto_cat:1) larger facilities
2) a lot more employees
3) multiple titles being developed
Yup... and therefore more inventory and sales...it should all even out
Quoted from cavalier88z24:not true. the temps at stern don't speak English. I know I tried to speak to them. Don't think they are us citizens. so there not paying taxes, not on sterns payroll, no work mans comp, no benefits, so they can hire multiple "people" for one job. better then it would cost one employee at fair wage.
This is just an ignorant post.
It would be fascinating to see a REAL survey of pinball collectors that dives into finances and financial investments in the hobby.
Frankly, with the compulsive "must have" nature of a lot of collectors, I'm surprised Stern has started offering financing programs through its distributor networks to make the high prices justifiable/attainable for those that just gotta have.
The largest cost bucket for a pinball machine or for that matter any thing that is manufactured in the US is OH cost. The overhead cost is more than labor and more than materials.
With that said... The cost of a pin has absolutely nothing to do with the selling price. The selling price for a pin is what the market is willing to pay. And right now the pinball market is hot, demand is up and so are prices.
Quoted from 27dnast:It would be fascinating to see a REAL survey of pinball collectors that dives into finances and financial investments in the hobby.
Frankly, with the compulsive "must have" nature of a lot of collectors, I'm surprised Stern has started offering financing programs through its distributor networks to make the high prices justifiable/attainable for those that just gotta have.
That is a great suggestion. And I am surprised they have not done that. That would definitely be a strategy for them to increase demand and differentiate themselves from other competitors. They could partner with a national bank to provide this type of financing.
I think one of the manufacturers did partner or introduce some sort of financing option a while back. But if I remember right, it turned out to be a very high-interest deal with a lot of crazy paperwork?
It takes a lot of cash reserve for a company to offer their own financing, and there is a lot of red tape and deadbeat folks out there to be chasing around. I don't think any of the current manufacturers are in a financial position good enough to finance a pinball machine. It's not like a car that has to be registered....this is a mobile item that can be folded up and moved to the next town, and re-sold 10 times over before the finance company knows it is missing.
The cost of the game varies greatly based on the number of games produced. My guess is that games that do not sell well actually lose the company money regardless of the price paid.
Here is my educated breakdown of fixed vs variable costs
Set Costs Per Game
Assembly Labor = $500 per game
License $100 or less per game
Set Costs per title
Design, software etc $1,000,000. I am sure there is wiggle room in this but I have heard this number from several interviews. This breaks down to roughly $400 per game at 2500 units produced, but could be significantly higher or lower based on production.
Exectuve Salaries - Whatever they are worth in the marketplace
Rent, Electric Bill, Water, Microwaves etc
Advertising (trade shows, adverts, etc)
Variable costs based on production volume
BOM- My guess is this is 2k and under for a pro and 2.5k-3k for a LE. Of course this number will go down based on volume, but probably not by much
There are many other costs involved (401k, Insurance, machinery, IT etc) but all in all the margins are probably in the 30% range on machines. I believe this is why Stern has started selling Mods. The margins have to be near 100% for those. The parts business should also be fairly profitable.
I wish prices were cheaper and I think 10k is a CRAZY amount of money for a toy, but I do not think 5k for a PRO machine is a rip off....
Quoted from LTG:I don't care who it is. I hope they make money.
Because part of that money goes into making the next pin.
And that way we keep getting new pins, making pinball stronger than ever.
LTG : )
hear hear! Although I still can't justify a 9K pin 
Except I'm looking at WOZs. . DAMN YOU PINBALL!
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KS
Villejuif
Beauharnois
London