Quoted from CaptainNeo:
The cost is PEANUTS. I mean dirt fucking cheap peanuts. not the $36 you would pay for a VUK bracket. More like $1.20 VUK bracket.
Yes, but there are so many hands touching every product. Might not apply to pinball, but where I work:
Typically full products we make the profit margins are slim (like $20-$30 on a $300 product), but it's because we do large volume selling to home depot. Now Home depot almost ALWAYS makes 30% profit margin on products they sell. Where we can make up a lot of the money is in service parts. A single injection molded part that costs $1 to make can cost $6 or more as a spare part.
You also can't look strictly at piece price. There's engineers that had to figure out how to build that part (though most pinball parts haven't changed in 20-30 years), there's assembly, incoming QC, shipping cost, overhead of storage, purchasing salaries, accounting, customer service, etc etc.
Still, with all that said, I'm amazed that Jersey Jack found anyone to back finance him (unless he's learned from his mistakes and put together a firm business plan). Announcing Woz 4 years ago with a preorder price, and having no idea what it's going to cost you to build is ludicrous. It's no wonder why he keeps backpeddling his pricing.