Anyone have any idea how long ago Hifi manufacturers discovered we (audiophiles) will pay almost anything chasing our perfect sound? I individualized it because each of us are reaching for our own personal nirvana. You can go to any audio show, see someone point to a piece of equipment and ask the price. Out comes a price you know the rep made up while sitting in his office wondering how much he can ask those sick people to pay. We know advertising, manufacturing, and overhead is relatively expensive but we also know that the asking price should take care of that if he sells maybe 4 or 5 of them all year. Knowing that I have paid quite a bit for equipment over the years that I knew I shouldn't have but did anyway.
Valid question... sometimes in this hobby you fork out $$$ and actually get something world class. Other times you have buyers remorse early on and realize you paid a lot for something that's no so great.
Sometimes something comes along that Is such a great value price is almost irrelevant . There have been some egregious price hikes since Covid, that doesnt help either.
Although if you use the CPI calculator you will see that great HiFi in 1965 cost just as much back then as it does now.
My Dad bought a pair of KLH 12 back in 1968, when I was 1. They cost $550 a pair ! ... that was like spending $5k today. I guarantee my Klipsch Forte IV were a better value.
Money is an invention, anyway. It's all psychology. If you feel like high prices are demeaning, don't pay them.
A gin and tonic cost me $15 the other day. Add up all the costs and the markup is exorbitant. Should I write a post complaining about it? Why would I? Such a post would say more about me than about the phenomenon.
Everyone has a different way of evaluating what they should spend their discretionary income on. I, personally, imagine a society where anyone willing to pay $100k on speakers decided to give half of that expenditure away to a needy cause. My guess is that listening to $50k speakers with the knowledge that $50k had gone to help someone(s) really deserving would make the experience a lot better.
The fact that much, if not most, audio gear sells for just a little more than half the original price on the used market after a couple of years somehow factors into the conversation.
Is the loss of value due to technological improvements of newer items, or an overstated anticipated intrinsic value and original price?
Jay’s Audio Lab bought and reviewed the $68K Gryphon two-chassis preamp.Using the industry standard of 1/5 the MSRP for cost to build that leaves a heck of a profit to be shared between manufacturer and dealer!
@oddiofyl 5K in some of todays market wouldn't come near purchasing the hifi gear currently available. However having said that, if you are frugal you can get some good deals on very good sounding gear. Some of the very expensive stuff, I just look at and never consider buying.
@mike_in_nc The next time a tax cut comes up.... refuse it. You may have more money than you know what to do with so this post probably isn't really for you.
The essay by Steven Stone is a good one, but awfully ironic; he has long written reviews for The Absolute Sound, which mainly features coverage of very expensive hi-fi gear. Has Stone been over to Fremer's house? 😉
I created my acoustic room with plumber tubes from my basements for 100 Helmholtz resonators...
I used mechanical crossfeed to improve the holographic acoustic perception..
I used foldable screens as lenses and diffusors or absorbers or reflectors...And many other improvised devices at very low costs , a few bucks, nothing marketed as tweaks except springs and cheap Schumann generators i modified etc ...
I lost my room...
I dwelved then in my unloved 200 bucks small speakers i owned from 10 years ago or 12 and put them on computer function for all this time because i never bother to optimize them to begin with ...After the lost of my acoustic room i had no other choice nor any other speakers to work with save the unloved one ...
I transformed them with cardboard and straws and isolation and damping and i put them in a small acoustic corner of my basement ... They go now from their unsufficient 85 hertz to 50 hertz which is enough 😁... My best optimization control was wood plates beside each speakers to mechanically decrease crosstalkin near field listening now...
My system is so good in near listening i cannot quit the music imaging, timbre and soundstage...
This small box system is better than my past headphones, with the exception of my main audiophile system now headphone based...
How is the cost of audiophile experience ? Peanuts costs if you learn basic electrical, mechanical, and especially acoustical embeddings controls...
By the way i am not an engineerr nor a very talented craftworthy person.... .But many experiments cost nothing and acoustic is fun to learn in its basic...Forget equations, experiment with the simple principles behind the equations and dont bother for perfection...
We must learn how to hear using acoustic concepts applied...
Audio is like medecine , learn to know your body needs and stay away from doctors if not chirurgically necessary; and learn acoustic basics and stay away from audio marketing....
Many people prefer to pay than to learn because it takes time and they prefer the power of money to knowledge..... Marketers count on this to make money...
I’ve never called myself "we" even during communism and have seen stereo system built from scrap components (in Cuba) and sounding TERRIFIC.
Time to become garage sale junkie driving around in pickup truck in the richest neighborhoods.
You can get everything there even cheaper.
I’m living example. I’ve forgotten path to hi-end dealer and I forgot an amazon and ebay link all together.
How about a couple of B&W N3 for $400 per pair MINT?
There's 88 years old dude with around 2b net-worth currently in the coma under the ventilator and he's got MBL speakers and components. His kids are both dumber then Coala bear and his wife has never been out of Rx drugs for the past few decades. Guess What's coming next...
me offering 2 grand for entire set and if too low, I'll ad another 500.
You are creative and we made our luck by staying attentive...Congratulations...
Myself i need no more...
I know exactly how to upgrade, with what and for the best cost...
It is important to communicate these facts to help others not to throw money out of the windows in this difficult times...
My speakers modified sound more than good, i will pass for the B&W even it is a deal ... 😊
If someone does not want to quit listening all his music files it is done deal acoustically for me ...I owned 9 headphones, dynamic, electrostatic and planar; i prefer my 200 hundred bucks speakers acoustically well embedded... No company can say and teach simple acoustic truth they will lost half their market.... They prefer to propose costly "upgrades"...
By the way with the incoming world crisis, deals as this one will not lack...But who buy audio components in a world crisis ? I use music as a therapy...
I listen this right now ( i am not religious by the way ) this sound spectacular on my small modified boxes... and therapeutic as revelatory 😉 :
Sounds to me like your cynical / lazy side has overwhelmed your rational senses.
I recommend doing some research into the founders and companies like Audio Research, Conrad Johnson, Pass, Wilson, Boulder, Magico… etc. leading high end companies were founded by men fanatically dedicated to pursuing the high end sound, Few, did not face bankruptcy at some point. These guys never had making a fortune remotely in their mind… only producing spectacular products, the very best possible.
I recommend instead of looking at a price tag and coming up with your own conspiracy theory completely devoid of facts or understanding, do some research and find the answer. It is easy to find. For instance try the Audio Research 50th Anniversary Book. It goes deeply into the endless dedication of the founder / lead designer… like almost any great high end companies. Learn about Wilson, Pass… etc.
4/5 times the cost? Good luck with that! It cost us $5K in parts alone to make custom mono block class A amps. The dealer wants 40% of the price. So if we sell them for $15K a pair we make $4K profit. WOW we are getting rich right? Selling 5 of them we get $20K. We are taking everyone to the cleaners right!
Now try selling a number of units to make $100K. Cannot make money as a company doing this. Pay some rent, a few employees, taxes, warranty if and when necessary. You get the point!
The OP seems very unfamiliar on how businesses work, how pricing is established, which market segments they compete in. He seems to ignores the costs of running a business, the R&D expenditures, and a markup enough to be net profitable/survive. If it were a larger market and thus able to sell more then maybe markups can be reduced offset by volume, but high-end audio is a small niche market.
Audiophiles are not “suckers” blindly paying more thinking that they will get a better sound. We generally are very careful and thoughtful on our choices.
Thinking that many speakers craftmanship designers are thieves who makes BIG money selling audiophile speakers is even if it was true a proof that they would be very bad thieves because one make money with vaccines or pharma drugs or banking or financials schemes , drugs and arms traffic, organ traffic etc not with audiophile speakers...😁
I dont even need to know the ratio of price parts cost versus the selling price to know that....
Most reputed speakers craftmanship is born of love not born from hubris...
The problem in audio is not the cost of ultra high end speakers; it is acoustic ignorance...
For sure some increase their price to sell luxury to rich people but it is not really crookery because these products overpriced are easy to spot...
….Out comes a price you know the rep made up while sitting in his office wondering how much he can ask those sick people to pay..
This seems false- unless the rep is the manufacturer, reps prices are usually established by the manufacturer. Reps sometimes can offer discounts to get the sale by reducing their profit margin, some manufacturers frown on this.
…advertising, manufacturing, and overhead is relatively expensive
What about R&D costs? This is a major factor in driving up costs. I’ve been to the Magico manufacturing where they gave cutting edge equipment including computers, CNC aluminum cutting machines, etc. IIRC they recently build/upgraded a $250k sound room. These costs must be covered by sales income.
I have Vimberg Mino D speakers whose Herculean construction is designed to reduce cabinet resonances and the finish is impeccable- this obviously adds to the cost. The Diamond tweeter obviously is costly. It is not some mere random markup. I’m fortunate that I could afford this speaker which is the lowest model from trickle down technology from Tidal.
I also have the Constellation Inspiration electronics. Again I’m the beneficiary of trickle down technology as my electronics are Constellation’s entry level. These were listed in TAS top 50 bargains. This doesn’t seem to fit the OPs random markup theory
@ghdprentice I'm stunned... you mean it really does cost $22,000 to make a preamp and market it? I want to thank you for informing me. I will try to not be lazy next time and find the answers you have already found.
I am really sorry that my comments come as a surprise to you. It saddens me that folks growing up and educated in a country with unhampered privilege, know so little about the world. I have taken advantage of opportunities and have worked for great high tech companies like Burr-Brown Corp, and Texas Instruments as an executive and a start up company. I have worked in the global manufacturing supply chain all over the world. Completely understand business, manufacturing. I have followed the high end audio industry for fifty years. Your perspective is so lacking in understanding it is embarrassing.
I can only suggest you learn more about the high end audio industry. You will find what I have said about of it is absolutely true.
I'm stunned... you mean it really does cost $22,000 to make a preamp and market it?
@ghdprenticeThis is the statement of someone who has no idea what he’s talking about or any faint clue of how business works. It’s just sad ignorance on full display. Maybe he’s kenjit’s dad. That’d explain a lot.
@ghdprentice I’m stunned... you mean it really does cost $22,000 to make a preamp and market it?
@frankmc195, lol, how about 22k for a cable, literally a piece of wire with a connector on each end? One can get a new car for 22k, y’know? Soon enough, some lousy dude... most probably a dealer lurking on these forums will try and equate everything that goes into making a car (a flippin car!!) to that 22k wire w/ 2 connectors somehow.
@czarivey ...can't say I've heard a cardboard bass, but a couple of cigar box basses, Yes. In the proper hands, one can appreciate what a lack of cash but time to spend can yield...esp. when the blues is rendered upon....
Nuthin' like a slide show on the neck....
Oh, and for you and @mahgister....y'all better git up early to beat me to that 88 yr. old after the 'kack'....who lives (for now) where exactly....? ;)
"....those mb'ell things? Ain't worth nil of late.....y'all let me take them off your hands, Hans....them and those big boxes hooked up to 'em. Where I'm from, they are cheaper than boat anchors...
Ya' gotta boat? Let's go dock racin'...." *engaging G*
...said the viper to the bunny.... ;)
@mike_in_nc....Tax cuts for the rich, well....heels...? :(
'They' already have tax cuts that you, me, and all (...well, most...) can only dream and think 'that's it'....or is...
Since 'they/them/those' have all these well-suited charge accounted drones leaning upon and 'contributing to' the 'representatives' that 'clamor and claim' that they serve Us,,,,
,,,a certain NJ rep(rehesible) being an example....
Gold bars....wtf.....'for emergencies'.....Well, I guess this is a good time for one...*LOL*
I'm one of those nasty dem types....(oh, shut up....I've got an idea the NDC can run that'll scare the GOP into latte' froth....*evil snicker* ;)...)....
'Tax cuts'.....They could care less...
(OK....I'm ready for deletion....damage already rendered to the weak of mind....)
@ghdprentice If I had been a man of the world, I wouldn't be as misinformed... however I do have someone like yourself to point me in the right direction. I should mention that I've lived in more countries than you can possibly imagine but I must have missed something when I was there. Thank you for your input.... you do understand that this is my opinion only and I understand that it is much different than yours.
I think we often overlook an element that is a critical element of the true "cost" of an item. The intellectual component. It seems we agonize over the price of "raw components" as the true "cost" of an item and dismiss the engineering, design and talent required to bring something from a sketch on a napkin to finished form -- ready for public consumption. This is flawed logic in my opinion. We are quite used to paying for "opinions" and "expertise" in purely intellectual fields such as medicine, financial planning, law, and others. There are zero material costs attached to the total price of those services in many cases. Yet, we expect similar (and, perhaps even rarer talent) in the field of high performance audio to be served to us at no (or, little) cost.
To be reasonable and pragmatic about this, let’s just set a number for the "financial burden" of a top audio engineer at $200k as a cost basis. (May be low, may be high?). If a manufacturer builds 1M of an item, that’s 20 cents per item for engineering. If they build 10, that’s $20k per unit for engineering. This is a REAL cost of production, not a massive eqo attached to the piece. IF we want to drill down a little deeper, this represents the COST to the manufacturer with no consideration for profit for the manfacturer OR the dealer. Doing the math and factoring in manufacturer wholesale "mark up" to dealer, and "standard" dealer gross profit, this may represent something closer to $38k addtitional price of the item at "retail" for engineering.
Successful manufacturers look at the market BEFORE they throw considerable resources (and money) at it to determine if there is a good chance of success before throwing a "dart" at the market to see if they get close to a bullseye. There is no "luck" attached here. Just smart business planning, with minimal risk. The point being, if we see "finished goods" out there at a price (even those well above our pay grades) it’s more likely than not that it represents "fair market value" and will appeal to the right (target) customer.. We may not agree with that value. But, it’s up to us to adopt or reject it.
@frankmc195 I have learned here that price is an almost irrelevant consideration for a true audiophile. Anytime anyone has questioned what they think is an absurdly high price for equipment, they typically get shouted down for daring to question how another person spends their money. There are people here that have $100,000 or more in their equipment and listening room — more than 10 times what I have in my system. Far be it from me to question how they spend their money — if ya got it, flaunt it. I’ve always been a “bang-for-buck” person with limited funds and a budget. I can’t spend 10 times what I do to listen to music, but bless those who can. I understand the premise of your question, as I often think the same, but I dare not question anyone here about their choices . . . even though some will question, even scoff, at a person whose budget is limited and their choices reflect that. I still glean some useful information here, though it is still a question of whose version of reality you prefer to believe. Take care.
@invalid I really didn't want to say this at all but what made me think of it was that the preamp didn't sound good and I was wondering if the rep thought he could get that kind of money for a preamp that wasn't very good. There is also a much advertised speaker that is along the same lines.... doesn't sound very good but asking price is nose bleed high. They have been in business for years so I guess that strategy may work. Again could be my opinion and also because someone is buying them I guess.
I think some reps and or manufacturers have slipped into the discussion but that is what it is far.... get both sides of the picture.
How in the world a flagship product from many decades ago could be categorized non audiophile product today ? as my amplifier for example or my headphone...😁
Price is almost IRRELEVANT in audio...I added the word "almost" because there is quality difference for sure in design and negating this would be stupid to begin with...
Acoustic and basic embeddings controls are way more relevant...
😊 This is so evident i dont see another reason to oppose that than bragging about new branded name products...
My active speakers cost is 200 Bucks... They sound better than almost all headphones WHEN rightfully acoustically embedded and modified ( 6 modifications)...
A speaker box with porthole is an Helmholtz resonator... Take a bundle of straws of THE RIGTH DIAMETER AND VOLUME and compute with your ears/brain in few experiments, put this on the rear porthole, and i go from 85 hertz measured specs to 50 hertz; the timbre is more natural now and the imaging and soundstage include my listening position in nearfield better than almost all headphones at any price ... I call this box speakers audiophile now, thanks to basic acoustic...
Each component sale must pay for the below (just a quick list off the top of my head).
Cost of Research and development
Design (Includes hundreds of hours of listening and swapping out different parts and breaking them in). By very talented and expensive engineers.
Manufacturing set-up: Setting up a line, developing testing stations along the way.
Design packaging —- pay for set up
Cost of Manufacturing:
Cost of Materials
Cost of ordering dozens or hundreds of parts with different lead times (this takes time and if you are missing one piece… your dead in the water).
Cost of holding the inventoried parts and finished goods
Cost of holding large quantities of repair sub components for sometimes decades.
Cost of packaging
Manufacturing Costs
Labor (health insurance, time off, taxes)
Utilities: Rent, electricity, warehousing
Cost of IT. Computers, software to run the business, networking.
Returns / repair processing
Cost of selling:
Sales force… if even only one or two .
Advertising - pages in mags, Google searches… etc.
Coordinating add purchasing,
Developing and managing a global network of retailers.
Road trips to manage retailers / distributors. Pressesce at Audio Show all over the world.
Order entry, inventory management.
Customer support line / technical support.
Finance:
Accounts payable
Accounts receivable
Manage cash
manage accounts that do not pay, make sure accounts receivable do not grow faster than accounts payable or you go bankrupt.
Cost of Manage employees and operation
Periodic accounting cycles, annual tax returns… W2 for all employees
Employee relations
Taxes
The above must be paid for by the sale of each high end component. The higher the price, the lower the sales number… the more each unit must cover it’s development, manufacturing cost and the cost of ongoing operations.
@invalid I really didn't want to say this at all but what made me think of it was that the preamp didn't sound good and I was wondering if the rep thought he could get that kind of money for a preamp that wasn't very good. There is also a much advertised speaker that is along the same lines.... doesn't sound very good but asking price is nose bleed high. They have been in business for years so I guess that strategy may work. Again could be my opinion and also because someone is buying them I guess.
The other way to look at this is maybe the prices and performance are fine and your ears/taste are what’s off here. Just because you don’t think they sound good doesn’t make it so. The free market takes care of these things, not your individual ears and personal tastes. Frankly, your assertions come across as both ignorant and arrogant.
I think we often overlook an element that is a critical element of the true "cost" of an item. The intellectual component. It seems we agonize over the price of "raw components" as the true "cost" of an item and dismiss the engineering, design and talent required to bring something from a sketch on a napkin to finished form -- ready for public consumption. This is flawed logic in my opinion. We are quite used to paying for "opinions" and "expertise" in purely intellectual fields such as medicine, financial planning, law, and others. There are zero material costs attached to the total price of those services in many cases. Yet, we expect similar (and, perhaps even rarer talent) in the field of high performance audio to be served to us at no (or, little) cost.
To be reasonable and pragmatic about this, let’s just set a number for the "financial burden" of a top audio engineer at $200k as a cost basis. (May be low, may be high?). If a manufacturer builds 1M of an item, that’s 20 cents per item for engineering. If they build 10, that’s $20k per unit for engineering. This is a REAL cost of production, not a massive eqo attached to the piece. IF we want to drill down a little deeper, this represents the COST to the manufacturer with no consideration for profit for the manfacturer OR the dealer. Doing the math and factoring in manufacturer wholesale "mark up" to dealer, and "standard" dealer gross profit, this may represent something closer to $38k addtitional price of the item at "retail" for engineering.
Successful manufacturers look at the market BEFORE they throw considerable resources (and money) at it to determine if there is a good chance of success before throwing a "dart" at the market to see if they get close to a bullseye. There is no "luck" attached here. Just smart business planning, with minimal risk. The point being, if we see "finished goods" out there at a price (even those well above our pay grades) it’s more likely than not that it represents "fair market value" and will appeal to the right (target) customer.. We may not agree with that value. But, it’s up to us to adopt or reject it.
To keep this specific to the 22k preamp that the OP brought up, I have a Luxman C900u (one can buy it new in the US for between 15 to 20k) and a Yamaha C5000 (10k new). I was able to get the Luxman for half the cost (couldn't pass that up) and was lucky enough to snag the Yamaha for less than msrp. I would put either one of them up against any SS preamp at any price.
You open either unit and it is a work of art, i.e. if a guy understands anything about analog circuit design. It is has always been its own type of black art, that a considerable number of electrical engineers should be able to tackle (no problem there). The catch is....the sonics of circuitry which no electrical engineering coursework would ever talk about. This is empirical information w.r.t iterative design acquired over decades of dedicated listening by engineers who are also "sound experts". Am i willing to pay that guy in Yamaha and Luxman that much, a guy who is willing to slash his wrists if he did a poor job at work? Sure...that level of competence and work ethic needs to be rewarded.
But, there are certain "elusive" brands in the "high end" who get it designed/fab'd completely in China. Am i willing to pay that poor Chinese engineer that much for his pain? Sure.....But, am i willing to pay the deadbeat dude who brought it over here for pennies on the dollar, put his brand name on it and suddenly managed to charge 50k? I sure as flip have no intention of paying that deadbeat anywhere close to that amount.
On a similar note, brands like Luxman, Accuphase, etc need to go manufacturer direct and cut the middleman unscrupulous dealer completely out. The product sold itself, sells itself and will continue to sell itself on its own!! I am willing to pay that class of manufacturer for his hard work and expertise. Am i willing to pay that dealer who sent an email, answered a phone call here in God's own land and claimed 50% of msrp (He sits there and sucks on that 50% like a leach while doing a whole lotta nothing)....lol, not only no, but, hell no!
Pay the guy who's worth your hard earned cash. Don't pay the scoundrels and deadbeats.
@soix by all means allow me to recommend a preamp and speaker to you so you can go out and buy them (Stop by your bank first).... however if they were on sale for $100 I still wouldn't have bought them... don't need paper weights.
Update on user end agreement
1. you understand these are my opinions only and you understand I've been wrong before.
2. You understand that your opinions are yours and not necessarily others.
I think since you can't be taller or have better hair or be better looking, it's important to buy very expensive things and tell people about them as much as possible. Or, just go online and claim you have high end stuff so strangers will think you're smart and wonderful. Win win.
I remember the first time I realized it was possible to spend a million bucks on a two channel music system... Have you ever mentioned that to your non-audiophile friends and been met with disbelief?
Some of these companies do not sell a lot of units so they make a huge profit on each one.. it's like funeral homes you are paying for the days that they are closed
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