alexh wrote:
As someone who works in the hardware retail industry, I wish we made more than 100% profit.
Well, it does vary on the types of products. I used to own and run two businesses and I'll admit that my margins on electronics were lower than other items. Clothes were typically the best, while most items I stocked were marked up x2.2.
50% is good but it is as low as 17% on set-top-boxes.
Of course, it also depends on the market size. I assume that you expected to sell more then a handful of those set-top boxes. ;-)
Also, you say you were "retail". There's a difference between the mark-up a manufacturer charges and the mark-up a retailer charges. In this case, ACube are both manufacturer and retailer. Also, as they intend to send boards to other companies for sale, they have to maintain a high price in order for the other companies to be able to make a profit on their sales.
So, let's say that ACube really only want to make $50 profit off each board, but the other companies who also want to market the board want to make an additional $25 then ACube themselves have to sell the board at $75 profit whether they want to or not.
Touche. I hadn't really thought of that, or insurance, or inventory storage etc.
Exactly, and it all mounts up. I often reminded griping customers that I started each month in the red thanks to rent, electricity, telephone, advertising, staff wages, etc.
I understand, I do. But this is not an ordinary retail venture, Acube do not have any NRE costs to recover. The r&d and even the PCB design was all done for them. All they are doing is effectively offering manufacturing services.
True, but they're also risking the cash in doing a production run and that's cash that could be making interest if placed in a savings account or cash that may have been borrowed why generates additional interest that has to be paid back.
At the moment, the true market size is an unknown. Perhaps if the successfully sell this batch then they will be in a position to more agressively price the next bath.
Unfortunately in the post Commodore Amiga era there has always been a temptation for unscrupulous developers to take advantage of the users due to the almost "monopoly" that exists.
The Amiga has never been a cheap hobby. :-)
The only way around this is to ecourage the manufacturers and retails we have to stay in the market and then hopefully attract new ones. As long as we live mostly off the scraps that eBay provice then new development is going to dwindle.
