(Topic ID: 83896)

Earthshaker Sinking Building

By Stu

6 years ago

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  • 73 posts
  • 24 Pinsiders participating
  • Latest reply 5 years ago by cougtv
  • Topic is favorited by 3 Pinsiders


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#30 5 years ago
Quoted from Stu:

I don't think you really understand the magnitude behind producing Reproduction Parts ( Like this one )....A small exercise: The Mod sells for $275 and the actual "cost to produce" is let's say $ 250 (I'm guessing here) so if the guy financing the project makes 50 of these he is into the project for $ 12,500 before he even sells just 1. So his profit is $ 1,250 +/-.....So to make an Additional 50 ( Just to have Hanging Around Collecting Dust While he Trys to Sell Them ) would cost an Additional $ 12,500 > bringing his total Initial Investment to $ 25,000....This being said, he has No Guarantee that he will Ever make his Investment Back, Let Alone a "Profit"....and thats just with 50 extras...If he were to do 100 "extras" to sit on a Shelf collecting dust for a couple of years, then his Inital Investment would be $ 75,000.....Now, I dont know about "you" but I sure dont have that kind of Disposable Income to just let it sit on a shelf and collect dust......Just my 2 ยข

From a financial standpoint then he simply shouldn't make them with those numbers. In a smaller, slow moving niche market you always need the higher markup since things do sit a bit for the most part. Now, if he is doing purely because its a fun hobby for him and money isn't considered his primary goal then talking about his profit margins and sitting on shelves is irrelevant

I see a lot of issues like this in the last year or so with more folks with lots of great talents joining the hobby. Someone is able to produce the same product in their garage for less money or a variation of it and the original guy is upset. Just see Cointaker for an example. They were basically the only LED supplier and had premium prices. Other folks came in and the prices have dropped. Making it great for us buyers, but poor for the suppliers of course.

I probably just ranted about nothing....nothing to see here

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