Indeed, there are also factors like offer vs demand, or the elasticity of price : you will, in some specific conditions get more volume of sales if you increase your price as the price can be perceived as an attribute of quality / stature, etc. this is a part of what price marketers can analyse during “psychology of price” in-groups surveys.
I don’t follow. Hardware is expensive, but chips, electrical components and circuit boards are not expensive? That seems pretty contradictory – is that perhaps a typo?
Sometimes things cost more because they have a lot of parts.
Sometimes things cost more because they are scarce.
Sometimes things cost more because they are hand-built.
And sometimes things cost more because they have Teenage Engineering written on them.
Your banter is one of the most consistent parts of my life.
Yeah, I’m going to start charging soon.
The label, its legacy, and the “stable of stars” attached to it.
No doubt the new Prophet~5/10 sounds good. But it’s got to be cheaper than the Prophet~6 in manufacture. I’ve opened both. The P-5/10 looks like an anorexic P-6.
That’s all it took to switch me off it. I couldn’t believe it cost more than the Prophet~Rev2 🤦
But still, your buying into “that” synth legacy (that everyone dumped for a DX7).
Cheers for this as its something thats rarely talked about(whats under the hood).
I think the question is the wrong way around… because the real question in the OP seems to be ‘why is Behringer so cheap/lower cost?’.
Most other manufacturers mentioned here are placed around similar price points for similar gear… compare Sequential to Roland to Elektron to Novation, etc, and they all have similar-ish pricing structures.
All of the main price influencers have been named already- R&D, labour costs, components, logistics, profit, etc.
One that hasn’t been mentioned is the retail/distribution/manufacturer tier system… retailers make around 30-40% markup on a product, distributors make 20-30% selling to retailers, manufacturers make 20-70% selling to distributors and retailers… all this has a baring on the final cost to the customer.
Behringer are a bit of an (disliked) outlier because their whole business model is based solely on PRICE. They sell gear because it’s cheap… they HAVE to be cheap/cheaper to exist.
For example, if they sold a TD3 for around the same price as a Roland TB303, which one would you buy?
So, without selling on price alone, they’d be dead in the water… their approach is a ‘race to the bottom’… make it as cheap as possible, sell in high quantities with a low margin.
Remove Behringer from the equation, and costs are pretty level (give or take).
I wanted to avoid it becoming a Behringer thread. But they are part of the equation yes.
i’d probably still buy the TD3 in that equation though because it’s the actual circuit and you can get in and mod it and stuff.
(but I get what you mean)
oh wait, an actual 303, not an 03.
right. erm. and is the 303 sixty quid, or is the TD3 three grand?
Yes, the point I was making is that they’re an outlier in the industry/market… there are similar approaches in other sectors… think of high street fast fashion using sweatshops to rip off fashion designers, etc.
Ok, let’s talk numbers…
On the P5/Take 5 scenario, behind the scenes, companies will often work on a multiplier from the cost price, lets say it’s 3x to the end user;
P5- £2400 approx retail (ex VAT)/3 = £800 cost price.
Take 5- £900 retail/3 = £300 cost price.
A Take 5 is probably going into retailers like Andertons and the likes for £570-ish from the distibrutor.
The distributor is probably buying it in for around £400-450 from Sequential.
I meant the current Roland Boutique one… TB-03.
I think if they are priced the same, most people would want to get the Roland version for the all round kudos/karma. (I do get the modding thing though on that example).
Not a typo, (sorry if I was muddled in my explanation) the hardware on a module means:
Faceplate, knobs, sliders, pots, jacks etc. This is where a lot of the expense comes from, the chips and circuit boards etc are relatively inexpensive (although current trends means this is changing).
Manufacturing costs, raw material costs, shipping costs, R&D.
if you have high Cost of sales you need to increase the price to make sure you have a good profit margin
This is hardware too. That’s what my point was.
Paying people a living wage or better, in a country where the cost of living is higher than other countries. Whether it is in design, assembly, or both. For more in demand creative designers, there is also competition which drives wages up. This increases the cost to build.
Not in the context of the podcast I was referencing, they saw electrical components as separate from ‘hardware’ i.e Pots, knobs, sliders etc.
I was using the distinction made by Tom Whitwell , who knows a hell of a lot more than I do about module/synth design and all this sort of stuff.
The definition can be used widely, I was just using a definition more suited to DIY eurorack, maybe?
I’m really curious about this too. Fwiw, strictly speaking from my own user experience and absolutely nothing else-
The p5 feels and sounds more than twice as good as a take 5 to me. I have no attachment to the p5 or nostalgia, I’ve only gotten into synths recently. The first time I tried a p5 reissue in store I was annoyed that it didn’t have an Arp or sequencer. I was super excited to try the take 5!
The p5 feels better than any synth I’ve ever played and sounds more alive to me. For those two reasons and nothing else, I figured “this high price makes sense.”
The take 5 is really nice. For me personally, to my surprise, the sound and “feeling” of it did nothing for me and I was really surprised. Based on that and nothing else, the price difference makes sense to me. For all I know though, one doesn’t or shouldn’t cost anymore than the other. It’s just a feeling for me.
Yeah, maybe in the DIY scene there are different definitions. I’ve never once heard chips or circuit boards be considered anything but hardware, but that’s me – my experience in this stuff comes from engineering, not DIY stuff, so my definitions might be a bit pedantic.
Sorry, I wasn’t trying to argue. I was mostly trying to understand the original point and now I totally get it.
Back on topic: I do think it’s interesting to hear that chips and circuit boards are less expensive than pots, knobs, faders, etc. – especially considering all the recent chip supply issues in the past couple of years. I know it’s been hell for the musical instruments industry, and I’ve even heard it referred to as “chip-aggedon” by some in the business.