Why is Expensive Gear More Expensive?

What factors go into making gear more expensive than others?

Sounds stupid but this must be how Behringer work. Reducing the number of factors. It cant be just hardware side. Development must be the main reason. But it cant be the only one as they must be paid the same(or are they)?

Nb. Im aware that the word expensive is subjective so when i say expensive i mean in the grand scheme of the entire market.

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A few quick reasons I could think of

  1. R&D and Tooling
  2. Design (this is a massive point I think most people ignore, a LOT of companies have very poor design elements on both products and in particular support materials like documentation, packaging etc) a lot of this is handled internally to save costs, but some companies will commission external designers
  3. Labour costs
  4. QA
  5. Company infrastructure such as internal software and equipment quality, as well as privacy/GDPR compliance
  6. Business costs/taxation and expenditure based on location
  7. Target audience (another massive one that can influence all other aspects)

Another often ignored factor is ownership. Companies that are represented by investment partnerships (one example, not exclusive) will do whatever it takes to maintain an ever increasing return. A change in ownership is frequently the reason we see shifts in the quality of a companies output as decisions are made in favour of profit.

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i feel like the Behringer TD3 is the perfect example of “not expensive”

low design costs - looks like a 303
low r&D - just copy a circuit people have been modding for ages.
get it made somewhere cheap, pile em high.

i mean, it’s fine, but you can feel the cheap.

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Economy of scale is a big factor.
1000 x a resistor is much more expensive than 20000 x the same resistor.

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My occupation has given me great insight in the cost of RnD and manufacturing… but what truly perplexes me is the cost of a Prophet 5 vs a Take 5… what are the fundamentals that makes on more expensive then the other? my gut reaction is that the Pro 5 is capitalizing on nostalgia. BUT i want to be open minded and not assume that its just the company riffing off its fan base.

Truly i wonder, what is it in the Pro 5 that makes it cost twice as much as a Take 5, when Take 5 on paper is more feature set? are there components that warrant this price? is there a special manufacturing process needed for the Pro 5? did the RnD drain the budget in order to faithfully replicate the OG Pro 5?

i am genuinely asking anyone with insight in this.

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Costs more

This isn’t even a silly answer. Ignoring lifestyle products like the OP-1 (trollface) there tends to be a fairly direct relationship between how much it costs to make something compared to what you pay for it.

I think people above me have covered the main attributes in that - Behringer are a good example of economy of scale.

Don’t underestimate the impact of certain components in the cost too - if you have a dozen knobs and you decide to use an Alps pot instead of a plastic shaft trimmer it could add 20% onto the cost of production. That’s just slightly better knobs.

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There is an interesting talk between MylarMelodies and Tom Whitwell where they discuss the cost of hardware on modules.
Why We Bleep
Certain knobs are crazily expensive (his prototype of the Control module had 4 X £15 knobs on there).
For example, the knobs on the re-issue of the Mini-Moog are of a different quality to the knobs on the Behringer Model D. Then add economies of scale

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This is something I think you really start to notice if you get into Eurorack as you have the opportunity to experience a wide gamut of knobs, buttons and controls.

I love WMD modules but their pots are junk IMO (must be a preference thing for the maker) - the ones on Qu-Bit stuff feel like a million dollars.

Starlab’s cost is probably partly down to the paintjob on the faceplate and the lush metal knobs.

I have no doubt if you do a teardown on one of those new Cre8audio synths (which I’m not hating on, they’re great), I bet you’ll find the cheapest version of every part you can order. The knobs are custom made and it’s not because they wanted them to be fancy :slight_smile: To be honest I still can’t work out how they’re making those so cheap it defies science.

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The podcast I linked to is worth listening to, they talk about the hardware being the most expensive part (excluding R&D etc). Chips + electrical components (until recently), circuit boards etc. are not expensive

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…well, first of all it’s naked math in numbers…

if u sell 10 thousand units, ur able to make a profit even if ur not “expensive”…
if u sell 1 hundred units, u need to be more “expensive” to make a profit…

if u put basic workethics on top of that equasion…like, do u care if ur product is built to last or not…in best case u do, but hey, then u have to take more care and put in more thoughts of/into all it’s details/concept/engineering…

and after all…how smart can u get the balance right when it comes to outsourcing, quality control, distribution, work and developing hours vs marketing, sales, final pricing…

it’s that easy…and that complicated…

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I don’t think you’re wrong about the nostalgia factor tbh. Just an opinion based on observations, as I’m not an engineer and don’t work with components etc, but I do think the prophet 5 is a better quality product in some areas, such as higher quality components.

Ultimately it would seem to be a combination of a few things including the research that will have been required to ‘reissue’ the design from an engineering and sound design standpoint including paid consultants etc, the build quality and a marketed prestige alongside costs from any US based manufacture which is affected by both scale of production and wage costs in the US vs insert cheap labour location

I guess we also have to consider whether we could class the take 5 as a derivative design based on things developed for the Pro5 rev 4. So some of the cost is absorbed as part of the p5 development. It’s definitely aimed at a lower end of the same market so I do wonder where the cost difference comes in and what exactly that would be.

Of course, production costs set a lower limit on how cheap a device possibly could get. However, when it comes to how high the price can go, it really depends on what the consumers are ready to pay. So, for example, if you build something for $1000 and people are ready to pay $5000 at the same pace as the production rate, this should be the price.

This can then be complicated further with a lot of different factors, but in essence (and I might be kicking at an open door here), I just think that it’s important to remember that in a capitalistic society, prices can be based on what consumers will pay rather than on what they should pay (whatever that means).

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I have seen OP amp IC for 2€ and for 25€, the cheap one TL081 was for consumer audio application, the expensive one an Analog Devives OPamp for video transmission, the video op amp sounded clearly better when used in a homebrew audio amplifier, the spec sheet had miles in between these two, much better slew rate, less distotion etc…

Components matter, you can get cheap or expensive capacitors etc.

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Also perceived value - which relates closely to your point - in fact it’s an element of it I guess.

In that a set of features can have a perceived value, and so providing those features increases the value of that item accordingly - regardless of any increase in production cost.

Different markets respond to these things differently too. My anecdotes are a bit dated but there’s a good design example in which for a period consumer electronics made for the Russian market were often overly complicated due it increasing perceived value. Extra buttons, lots of knobs.

Where in other markets people were wanting to pay more for less, the value came from simplicity.

higher quality components, smaller production batch, nicer design, high end brand. pick and choose

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Price is not always a result of cost factors, ie luxury brands or in the electronics worlds Apple for example. Price can be part of the brand/appeal by making it an exclusive item, not directly related to its design/manufacturing cost. I suspect this is true for the OP1 field, for example.

Idk… TE basically said in a interview they felt bad it cost so much but they didn’t want to skimp, and that’s kinda what everything being custom costs for them to make a profit.
I don’t think any of these companies are making that much money really… atleast not like Roland does…
The take five is only analog in the oscillators and filter, and about every part of the build is cheaper… it even has thinner metal and the power supply had like a plastic box around it instead of the metal like other sequential’s. Basically all of the prophet 5 is analog, even the modulation is digitally generated but converted to cv before it touches any circuit… most poly’s are not. Most off this stuff cost about 30% of the customer cost to manufacturer, then all the other costs… they might get 20% or so but who knows… they don’t make profit per unit like a furniture company would, or anything else really.

I’m not even sure about this.
OP-1 OG was a marvel of design, things like accelerometer or OLED or incredibly powerful battery were not that ubiquitous back in 2010, and I’m surprised to see mine not aging a bit. The functionalities are IMO tightly and logically packed, it’s a very coherent instrument.

I can’t say for the OP-1 field, but I do believe it’s been made to last at least as long. And while keeping the design the same as OG obviously saved on the designing effort, everything has been re-engineered to a new platform, and, I believe, to leave room to further improvement…

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I’d also add some brands build a lot of things by hand, others are more machine built. Built by hand in the US is probably a much different cost than China.
Bheringer and Moog come to mind when I think of those things.

Lots of wood and nicer knobs, fit & finish on the Prophet 5. Also longer keyboard. Now, does that equal twice the cost? Probably not. It’s based on what people are willing to pay. Lots of companies do this, from different tiers of cars, or even a custom shop guitar vs a standard model guitar. It’s all based on different tiers, and Sequential isn’t going to sell the P5 for the same price as the Rev 2 or Take 5. And they raised the price of the Rev 2 last year as well, because I don’t think they wanted it being in the same tier as the Take 5. Now you have the base tier of the Take 5, then you can step up to a bigger keyboard and more voices with the Rev 2, or go vintage nostalgia premium with the P5/P10. And of the three, the P5 definitely feels like the most premium model when playing and interacting with them. It’s like the Cadillac of the lineup. I think the angle Sequential are taking with the P5 is that they are basically selling you a brand new one for half the price of a vintage unit. And of course the extra features like second filter, vintage knob, stacking, etc.

TL:DR
Could they sell the P5 for less and still make a profit? Yes. Will they? No.