Stern: Cost to make a machine


By newpinbin

1 year ago


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    There are 169 posts in topic. You are on page 2 of 4.
    #51 1 year ago

    Just found a photo of Gary's cat litter box. He makes more money than we realize.

    1535745_700778156634177_1007177668_n_(resized).jpg

    #52 1 year ago
    Quoted from 27dnast:

    Not sure how much a machine costs to make, but I think there's a pretty good chance distributors are making about $600 on machines sold at a good price and A LOT more on machines that a customer pays full MSRP.

    That's what I have heard as well. $400-$600 gross on distributor priced machines, doesn't seem like very much money when you think about it. Its not about when things go well, like drop shipping a game, instead making enough to discount poorly selling games stuck in inventory below cost if need be, hidden damage that is not caught until two weeks later and the customer expects someone else is going to pay besides them. Profit is not a dirty word in my book and if a price doesn't feel right, best to shop around or don't buy. We have many choices in our free market system. I've taken a guess at what the actual cost would be on manufacturing a pin, and its just that, a guess. When costs came out in my industry(automobiles), consumers expected us to sell at or near it and still do. It's best to never have the real numbers out there in my opinion and I don't think we will ever have to worry about that. If all these guys were making so much money they would have not all have gone broke in the last 20 years. Manufacturing is a tough business, I for one would go into cardiac arrest if my line stopped due to parts delays and I had hundreds of thousands in overhead. No thanks

    #53 1 year ago

    How dare they actually make a profit selling games..........who cares what they are making. Don't like their price? Don't buy the damn game.

    #54 1 year ago
    Quoted from dkazz1:

    How dare they actually make a profit selling games..........who cares what they are making. Don't like their price? Don't buy the damn game.

    About 70 percent of the posts here are about - in one way or another - pricing, profits, or costs relating to pinball. It's really all anybody wants to talk about.

    I'd say pretty much everybody cares.

    #55 1 year ago

    That's true Levi, but no company in their right mind is going to divulge their gross profit margin or dist cost in a public forum.

    #56 1 year ago
    Quoted from Jasontaps:

    I agree, I would what I was told not to loose my distributorship as well.
    I just don't understand all the secrecy.

    In my field, when I want a piece of equipment, I can only deal with my local distributor. If I go out of the area, no distributor will sell to me. These are rules that Wirtgen, CAT, John Deere, Komatsu, etc. come up with.

    I understand Stern not wanting their distributors openly competing with one another.

    #57 1 year ago
    Quoted from Trekkie1978:

    In my field, when I want a piece of equipment, I can only deal with my local distributor. If I go out of the area, no distributor will sell to me. These are rules that Wirtgen, CAT, John Deere, Komatsu, etc. come up with.
    I understand Stern not wanting their distributors openly competing with one another.

    That's pretty common in many industries, they don't want the distributors cannibalizing off of one another. The big thing people need to realize is they (Stern) build machines with not a lot of excess inventory sitting out there. It's a different animal than what it used to be.

    #58 1 year ago
    Quoted from CrazyLevi:

    About 70 percent of the posts here are about - in one way or another - pricing, profits, or costs relating to pinball. It's really all anybody wants to talk about.
    I'd say pretty much everybody cares.

    Stern and Distributors are private companies. The only people who should be concerned with their bottom line are the owners. Outside of that, it is nobody's business. If they were a public company, then the only people who should be concerned are the shareholders.

    I deal with it all the time in my company. I buy my product for $45/ton, but I sell it for $85/ton. Am I making $40/ton? Nope. I have payroll, insurance, taxes, office expenses, repairs, truck expenses, loans, interest, etc....and on top of all of that, I still need to make a profit...otherwise, there is no point in me working 70+ hours a week.

    #59 1 year ago

    I used to be a maintenance technician at a third party automotive manufacturing facility. We sold fuel pump assemblies to Chrysler for new Dodge Durangos, Neons, etc. our contract with them stated that for every vehicle that came off the line and did not start because of our fuel pump assemblies, we would be fined the price of the vehicle to make. Durango was 8000.00 at the time. I believe they were selling for between 30,000 and 40,000 depending on options etc. The Neon was about 2000 or 3000 and were selling for 13000. This was about 15 years ago but the model is probably the same.

    #60 1 year ago

    Since Stern pretty much just makes pinball machines; there is more than just straight product materials and labor that have to be figured into the costs of each machine. Things such as game licences, project and development costs, administrative salaries, building lease, liability insurance, lawyer fees, building utilities, taxes, employee wages and benefits, transportation/trucking, health care costs, building maintenance, etc. It all gets figured into the cost of each game.

    #61 1 year ago
    Quoted from Trekkie1978:

    Stern and Distributors are private companies. The only people who should be concerned with their bottom line are the owners. Outside of that, it is nobody's business. If they were a public company, then the only people who should be concerned are the shareholders.
    I deal with it all the time in my company. I buy my product for $45/ton, but I sell it for $85/ton. Am I making $40/ton? Nope. I have payroll, insurance, taxes, office expenses, repairs, truck expenses, loans, interest, etc....and on top of all of that, I still need to make a profit...otherwise, there is no point in me working 70+ hours a week.

    ^^ This^^ +1. I deal with this all the time in our area that I live in. The general public just don't have a clue what it cost a business just to stay in business and survive.

    #62 1 year ago

    I'm glad we live in a free market where I can price my business with enough profit that I can buy pinball machines. Someone else might accuse me of being a parasite or something for not being non-profit and I owe it to everyone else to live like a pauper, so they can save $5.

    #63 1 year ago

    Does the roughly $2000 amount thrown around a few times include all the costs for the game, or just the BOM? Man hours for design, testing and assembly? Benefits for those employees? etc, etc.

    #64 1 year ago
    Quoted from frolic:

    Just found a photo of Gary's cat litter box. He makes more money than we realize.

    1535745_700778156634177_1007177668_n_(resized).jpg

    See Gary's not making as much as you all think other wise the kitty litter would be $100s instead of $20s.
    The average worker will never truely understand the cost of running a business day to day.

    #65 1 year ago

    I believe it all falls down to a failure of education. Kids should be taking economics/finance/accounting courses from grades 5-12.

    » YouTube video

    #66 1 year ago
    Quoted from Trekkie1978:

    I believe it all falls down to a failure of education. Kids should be taking economics/finance/accounting courses from grades 5-12.
    » YouTube video

    LOL

    I actually thought of this scene too earlier in this thread when someone mentioned "widgets."

    #67 1 year ago
    Quoted from dkazz1:

    That's true Levi, but no company in their right mind is going to divulge their gross profit margin or dist cost in a public forum.

    I agree. No reason to think Stern would ever share this info.

    I always think it's funny when people come here to brag about some great deal they got, not realizing when they try to sell the game in 6 months everybody will hold that against them.

    #68 1 year ago
    Quoted from CrazyLevi:

    I agree. No reason to think Stern would ever share this info.
    I always think it's funny when people come here to brag about some great deal they got, not realizing when they try to sell the game in 6 months everybody will hold that against them.

    Yes indeed, how dare they make a dollar off of a game when the market demands a higher price point?

    #69 1 year ago
    Quoted from GreenMachine19:

    I used to be a maintenance technician at a third party automotive manufacturing facility. We sold fuel pump assemblies to Chrysler for new Dodge Durangos, Neons, etc. our contract with them stated that for every vehicle that came off the line and did not start because of our fuel pump assemblies, we would be fined the price of the vehicle to make. Durango was 8000.00 at the time. I believe they were selling for between 30,000 and 40,000 depending on options etc. The Neon was about 2000 or 3000 and were selling for 13000. This was about 15 years ago but the model is probably the same.

    I can tell you these amounts are not accurate. Car manufacturers have to be pretty competitive with pricing among each other. Perhaps your quotes were simply raw material totals (ie not including any labor, R&D to design and make the car, tooling up, or any other costs), a percentage total, or something to that affect. The only thing I can tell you is that a Durango that sold for $30k was never manufactured for $8k. If those margins were true, no car manufacturers would ever be in danger of going out of business.

    #70 1 year ago
    Quoted from Trekkie1978:

    In my field, when I want a piece of equipment, I can only deal with my local distributor. If I go out of the area, no distributor will sell to me. These are rules that Wirtgen, CAT, John Deere, Komatsu, etc. come up with.
    I understand Stern not wanting their distributors openly competing with one another.

    Yes, but this is pinball. Basically toys.
    No matter which manufacturer, I would be selling pins at Best Buy, Wal-Mart, Costco (like The Pin was) or wherever else I could get exposure.

    #71 1 year ago
    Quoted from Jasontaps:

    Yes, but this is pinball. Basically toys.
    No matter which manufacturer, I would be selling pins at Best Buy, Wal-Mart, Costco (like The Pin was) or wherever else I could get exposure.

    Sure, if you want to over saturate the market and drive Stern's profits in the toilet, go ahead and sell to wal-mart........

    #72 1 year ago
    Quoted from dkazz1:

    Sure, if you want to over saturate the market and drive Stern's profits in the toilet, go ahead and sell to wal-mart........

    Fine with me if Stern loses some profits, i would like to have a new game at a fair price.

    #73 1 year ago
    Quoted from pinbum:

    Fine with me if Stern loses some profits, i would like to have a new game at a fair price.

    That's brilliant.

    The Wal-Mart model doesn't work for Stern AT ALL.

    The model is to force manufacturers to make things as cheaply as possible and of the lowest passable quality - not in the USA of course - so they can sell stuff as cheaply as possible. You want to see Stern games that are worse than Striker Extreme or Sharkey's? Get their entire business model focused on getting games into Wal-Mart, where they will never sell anyway.

    #74 1 year ago

    OK, drop Wal-Mart from the equation, but the point is, I think if there was a NIB pro model down the street from me at Best Buy, I probably would have bought it by now.
    Instead, I am torn between Hobbit, Big Lebowski or Pat Lawlor's new machine.
    That's why they put candy in the isles as your checking out. I'm not saying you go into Best Buy to get an album and come out with a pinball machine, but it does ignite the idea for people who probably didn't even know you can own your own machine. And for pinheads such as myself, I may just grab that Star Trek or Walking Dead instead of waiting for Ghostbusters because its there, its local, I can see and play it and take it home now.

    #75 1 year ago
    Quoted from Jasontaps:

    OK, drop Wal-Mart from the equation, but the point is, I think if there was a NIB pro model down the street from me at Best Buy, I probably would have bought it by now.
    Instead, I am torn between Hobbit, Big Lebowski or Pat Lawlor's new machine.
    That's why they put candy in the isles as your checking out. I'm not saying you go into Best Buy to get an album and come out with a pinball machine, but it does ignite the idea for people who probably didn't even know you can own your own machine. And for pinheads such as myself, I may just grab that Star Trek or Walking Dead instead of waiting for Ghostbusters because its there, its local, I can see and play it and take it home now.

    How many games does Stern produce a year? 10k? 15k?

    Considering that they sell their products globally...the amount that they produce is on a small scale.

    Best Buy has almost 2,000 stores worldwide.

    #76 1 year ago

    Depends on how many games they sell. Costs north of a million to design a machine. If you don't sell many, you lose money on that particular game. Sell tons of a given game and make tons.

    #77 1 year ago
    Quoted from pinbum:

    Fine with me if Stern loses some profits, i would like to have a new game at a fair price.

    What is a fair price?

    Stern is making thousands of games per year that can be delivered to your house for under $5,000.

    Secondly, if Stern loses enough profits, they will go the way of American Motors, Circuit City, Eastern Airlines. A healthy company can stay in business a lot longer than an unhealthy one.

    #78 1 year ago

    Show me a new Stern delivered to my house for under $5000?

    #79 1 year ago
    Quoted from Jasontaps:

    OK, drop Wal-Mart from the equation, but the point is, I think if there was a NIB pro model down the street from me at Best Buy, I probably would have bought it by now.
    Instead, I am torn between Hobbit, Big Lebowski or Pat Lawlor's new machine.
    That's why they put candy in the isles as your checking out. I'm not saying you go into Best Buy to get an album and come out with a pinball machine, but it does ignite the idea for people who probably didn't even know you can own your own machine. And for pinheads such as myself, I may just grab that Star Trek or Walking Dead instead of waiting for Ghostbusters because its there, its local, I can see and play it and take it home now.

    Why would best buy waste floor space on pinball machines they will almost never sell. And why would stern produce thousands of extra games just to sit around at best buys across America not getting bought?

    Think about it man. If you were the best buy exec who suggested this at a board meeting you'd be looking for a new job by happy hour.

    #80 1 year ago
    Quoted from pinbum:

    Show me a new Stern delivered to my house for under $5000?

    Not hard to do, call around, I have one coming for under that.

    #81 1 year ago
    Quoted from Jaybird815:

    Not hard to do, call around, I have one coming for under that.

    Do me a favor and Pm me so i can get one also.

    #82 1 year ago

    Not much
    There is a couple hundred worth of wood
    $50 worth of metal
    Plastic is cheep
    And some ink

    #83 1 year ago
    Quoted from CrazyLevi:

    Why would best buy waste floor space on pinball machines they will almost never sell?
    Think about it man. If you were the best buy exec who suggested this at a board meeting you'd be looking for a new joy happy hour.

    Ultimate Electronics used to sell Pool Tables, arcade games and pinball machines (I know, and look where they are today, out of business).

    Then stick with Sam's Club, BJ's etc. Your getting off track of my point about why Stern are so secretive about their prices.

    #84 1 year ago
    Quoted from Jasontaps:

    Your getting off track of my point about why Stern are so secretive about their prices.

    They are trying to protect their market. They don't want any of their distributors going out of business.

    #85 1 year ago

    Manufacturers in general often don't make a lot of profit, yet they take all the risk (though pinball is a different market since it's all sold through distributors). I know home depot automatically makes 30% profit minimum from goods sold in their store. Plus if something doesn't sell, it gets heavily discounted then goes back to the manufacturer.

    #86 1 year ago

    What I do know is that I want them to make some kind of a profit so they keep pumping out more pins....

    -3
    #87 1 year ago

    Why is this suddenly no ones business? If there making $4000 profit on a machine that I really want such as Metallica, then I am still going to pay it. So it really does not matter how much you are making on me. You can go to Spoke.com and pull up numerous personal information about someones PERSONAL life, but you are worried about me asking (and knowing) this secret question of how much STERN is profiting.

    #88 1 year ago
    Quoted from newpinbin:

    Why is this suddenly no ones business? If there making $4000 profit on a machine that I really want such as Metallica, then I am still going to pay it. So it really does not matter how much you are making on me. You can go to Spoke.com and pull up numerous personal information about someones PERSONAL life, but you are worried about me asking (and knowing) this secret question of how much STERN is profiting.

    What is your social security number?

    #89 1 year ago
    Quoted from newpinbin:

    Why is this suddenly no ones business? I

    Suddenly?!

    It's been this way for about 60 years.

    Why are you so bent out of shape over this? If you REALLY need to know the profit margins in the pinball business, get a job at Stern or a distributor and I think this information will come your way. Otherwise you'll just have to try to get to sleep at night not knowing, just like most of us have for our entire lives.

    #90 1 year ago

    Is newpinbin really Kanaduh trolling for podcast material?

    #91 1 year ago

    I have a manufacturing background. I would imagine they are doubling their money or close to it. Probably somewhere between 40 and 50% markup.

    #92 1 year ago
    Quoted from pinbum:

    Fine with me if Stern loses some profits, i would like to have a new game at a fair price.

    That's exactly right. So many here take the side of the "owners" as if they were one, rather than the side of the consumer, which they are.

    #93 1 year ago
    Quoted from ronlisa:

    ^^ This^^ +1. I deal with this all the time in our area that I live in. The general public just don't have a clue what it cost a business just to stay in business and survive.

    Join the club. I'm a school teacher and everyone thinks that they're an expert in education because they used to be a student.

    #94 1 year ago
    Quoted from usandthem:

    That's exactly right. So many here take the side of the "owners" as if they were one, rather than the side of the consumer, which they are.

    I'm a small business owner. I lived through 2008-2011 where I was making just enough to pay my bills. Owning a pinball machine was completely out of the question. 5 years later, my company is doing better and is much healthier for the next time a downturn comes along.

    Remember, Stern only survived the last downturn because of an outside investor.

    #95 1 year ago

    Are you also mad because MMR's cost what they do? Or any other manufacturer of pinballs? Are you mad because the market dictates a Monster Bash is now north of $6,000 for a players machine? Idk...

    #96 1 year ago
    Quoted from newpinbin:

    Why is this suddenly no ones business? If there making $4000 profit on a machine that I really want such as Metallica, then I am still going to pay it. So it really does not matter how much you are making on me. .....

    What is the real point of this thread? You start a thread wanting to know how much profit Stern makes and now you say it doesn't matter if they make $4k on you. The only part of this you got right is " ... that I really want such as Metallica, then I am still going to pay it. ... " yep, that is how business works.

    Somebody makes a product and sets a price at which they make a profit (nobody sells for a loss and stays in biz), the amount of profit isn't relevant ... either you are willing to pay for it or you aren't. If NOBODY is will to pay the price a business can choose to reduce the profit to stay in the market (and perhaps delay closure, but eventually a lack of capital/profit will hamper growth/innovation and result in failure) or just close down.

    #97 1 year ago

    I have had a few pinsiders PM me on where to get a new older title Stern for under $5000, what i meant in my previous post was for a brand new title like Ghostbusters.

    #98 1 year ago

    If you think it is so cheap and easy to sell pinball machines, then you should definitely go into business and try to beat Stern at its own game. If you are right, then you should be able to undercut them and run them out of business in no time.

    #99 1 year ago

    I love it when people start a thread by pretending they want to ask an innocent question, when actually they just want an audience to hear their agenda.

    #100 1 year ago
    Quoted from Jasontaps:

    Not a good argument. Anyone can look up the dealership costs on vehicles. Hold backs and selling incentives are another thing.
    Don't get me wrong, I totally understand these pinball manufactures need to make a profit. Its the only way to survive, but why do people get upset when someone asks the price of a machine publicly?
    Hey, let the vendors list their selling price here. Stern has set a new unilateral pricing policy now, so if one dealer wants to ask more than the others, why shouldn't we all be aware of it. We can pick and choose who we want to buy it from.

    Fair enough.

    By the way, what do you do for a living and how much money do you make a year? I want to know. Please give me your net and then what you make after taxes.
    Thanks.

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