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Speakers that are a great value!

I’ve been researching off the shelf speaker drivers quit a bit lately and smaller speaker companies as well.  I’ve been finding that companies like Fritz, Salk and Tekton offer incredibly well priced products.  I’m finding that with certain models, there really only appears to be small profit margin.  I understand that when you buy large quantities of drivers, you can get a small discount but still.

For instance, I’m seeing speakers that sell for $2000 might have $700 worth of drivers in them.  When you add in $100-$200 worth of crossovers, $100-$200 in cabinets, $50 for miscellaneous components like binding posts, damping material, wiring, solder or connectors you come up to around $1200 worth of raw components. Now add in labor to construct the boxes, possibly put veneer on them, solder and put together crossovers, install drivers and then ship the speakers, the value is really quite good.  I haven’t even talked about obtaining the woodworking tools to do such a product, rent on a building, utilities on that building and the labor costs if you have any employees. 

My point to all this is to open a discussion and to help people understand that there may only be a $400 profit margin on a $2000 pair of speakers.  I think that these are an exceptional value at full asking price and that should be taken into consideration when thinking about buying speakers from these manufacturers.  
I sometimes hear that these speakers are overpriced and that the value is not good and I would tend to strongly disagree!  
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Showing 1 response by danvignau

danvignau's avatar
danvignau
935 posts
 
     I am afraid you are misinformed.  The dealer cost on high end audio speakers is 50% of retail.  Parts are always priced individually at higher prices.  For example, when a 1963 Bel Air 4 door sedan with a the options of a radio, carpets, 283 V-8, automatic transmission, and backup lights sold for $2995, as my Mom's did, the individual cost of parts was over $30,000, as calculated by the local dealer parts department.  
   
     When you price an individual speaker driver, you are paying the highest cost per unit.
     On my pair of 1981 B&W DM14's a replacement woofer was $150 from B&W, or $600 for the four in a pair of speakers. It also has two very nice tweeters that were certainly not cheap for their day.  I saw the invoice from B&W to the dealer, because my Saint Augustine neighbor was the rep who sold them to the stores.  The store paid $500 plus $50 for "shipping", which was really the rep's 10% "commission".   It has four plus a very nice wood cabinet, stands. a quite expensive crossover, and nice grills.    Retail was $1000.

      When the dealer says he makes $400 on a set of $2000 speakers, he paid $1000 for them, but pays the salesman a commission (Often 20% of the profit, which is $200.), has building costs, utilities, insurance, taxes, etc, so he possibly does only personally pocket $400.     
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