How much does it REALLY cost to make a sub?

[flakko 5,000+ posts]

lol yea we should be payin in rocks.

 

[cjjackson85 5,000+ posts]

Like in slate & marble //content.invisioncic.com/y282845/emoticons/confused.gif.e820e0216602db4765798ac39d28caa9.gif

 

[nametaken 10+ year member]

No shit.

//content.invisioncic.com/y282845/emoticons/laugh.gif.48439b2acf2cfca21620f01e7f77d1e4.gif

Hmmm, very good question though.

 

[BeanII 10+ year member]

I believe he meant the manufacturer doesn't make as much as folks would think. But yes dealers make great money on speakers and subs.... that is not there highest profit margin area. That would be the install items? //content.invisioncic.com/y282845/emoticons/crazy.gif.c13912c32de98515d3142759a824dae7.gif they pay $.50 for ft of 0ga and sell it for $5.

yeah, you are right. I wasn't thinking about accessories or even labor. kits/harnesses all that stuff can be marked up to 60-70%

 

[BeanII 10+ year member]

hahaha i didnt see that actually but if you guys are gonna try to tell me that all these companies are making 100%, then I //content.invisioncic.com/y282845/emoticons/laugh.gif.48439b2acf2cfca21620f01e7f77d1e4.gif. Paying 50 and selling for $100 would be 100% markup. A manufacturer selling millions of items is not looking to double there money on each item. //content.invisioncic.com/y282845/emoticons/rolleyes.gif.c1fef805e9d1464d377451cd5bc18bfb.gif The retailer has a greater markup% but at the same time doesnt sell near what say alpine or kicker would.

bimma, I worked for a consumer electronics retailer for 10 years. There is a ton of stuff that is marked up that 50%. From a cost of 50 to a reatail price of 100. A retailer will call this a 50% profit margin because 50% of the selling price is profit. Make sense?

Now, I work on the manufacturings side. WOW have I learned a lot. Manufacturing is where the money is made......!!!! They make up MSRP, they decide costs, they do all of that. They sell it for whatever they want. It's pretty wild. 70-80% markup from manufacturer to retailer is not uncommon.

 

[Steven Kephart 10+ year member]

Now, I work on the manufacturings side. WOW have I learned a lot. Manufacturing is where the money is made......!!!! They make up MSRP, they decide costs, they do all of that. They sell it for whatever they want. It's pretty wild. 70-80% markup from manufacturer to retailer is not uncommon.

Which manufacturer do you work for? Because we would LOVE to make those kinds of profits. However we aren't anywhere close to that. You guys also have to consider that there is a lot of money spent in tooling parts for new speakers. That has to be added into the equation as well. Usually the dealer makes more money on a driver than the manufacturer does.

Steven Kephart

Adire Audio

 

[BeanII 10+ year member]

It's a different industry than 12 volt.....

structured wiring. I just started w/them. Like I said 70-80% is not uncommon...But at the same time it's not the norm.

I didn't know you guys were in Washington. Hmmmm cool. I'd like to chat w/you about some stuff. I'll PM you later. Probably not today though.

 

[vosschs 5,000+ posts]

Which manufacturer do you work for? Because we would LOVE to make those kinds of profits. However we aren't anywhere close to that. You guys also have to consider that there is a lot of money spent in tooling parts for new speakers. That has to be added into the equation as well. Usually the dealer makes more money on a driver than the manufacturer does.
Steven Kephart

Adire Audio

finally some real input

 

[req 5,000+ posts]

i stopped reading this after the 5th post.

so bear with me.

as a few people said, out of the 'car hardware' that retail stores sell, (ie: speakers, subs, headunits, amps, misc [not wires and accessories]), speakers are usually marked up about 60%, wheras headunits are 10~20%. at circuit city for example, headunits are marked up enough to make a profit, but if you buy one that is $99 and up, there is free labor for the installation. and that knocks that 10~20% profit to maye 2~5%. so they are really not making any money.

the BIGGEST profit margin any chain retail stores make - again, taking circuit city for example, are the extended warranties. i was told by my manager YESTERDAY, that the warranties are 80% complete profit, the other 20% going to actual replacement\repair of elegible broken stuff.

so honestly, speakers dont cost that much to put together, but the research to develop a quality speaker, the tooling for all the special (if there is any) stuff, and the labor (not including parts and facilities) do cost quite a bit of money.

 

[Goldenknob 10+ year member]

but his main question was what does it cost to make one... I'm taking this as after the whole production line is set up.. what do the actual parts cost to make one speaker... probably 10-20 like someone said above... now including the manufacturing for all the new tools and parts and machines to make the new speaker and the advertisement.. there wouldn't be a profit for some time probably.

 

[iagrdshaka 5,000+ posts]

Which manufacturer do you work for? Because we would LOVE to make those kinds of profits. However we aren't anywhere close to that. You guys also have to consider that there is a lot of money spent in tooling parts for new speakers. That has to be added into the equation as well. Usually the dealer makes more money on a driver than the manufacturer does.
Steven Kephart

Adire Audio

x2 Steve should know //content.invisioncic.com/y282845/emoticons/naughty.gif.94359f346c0f1259df8038d60b41863e.gif

 

[IRACEMYCOPCAR 10+ year member]

I work at a small retail chain (12 stores) my owner just started her own line(coaxails,subs,amps). she is getting everything custom made in china. she had to put up at least $200k up front for tooling costs and R&D not to mention the actual cost of manufacturing the equipment. a 15" sub shes getting made costs $56 dollars to manufacture (4"voicecoil) which she retails for $299. if one blows she charges the $56 and replaces it at cost. however if you factor in the tooling and R&D the sub really costs her more than that so the markup has to cover the up front loss and the lost profit of replacing equipment. not to mention the 3-4 trips to china every year.

i do know there is huge markup in the retail end. we sell basic harnesses for $8.00 the cost is under $2.00, now the box stores like best buy sell them for $16.99 which is why they say "free labor" really you are paying for it just by getting the parts for installation. they pay their installers about $11 an hour, so if it takes one guy an hour to put in a basic HU they still are making profit because they have more markup than that just in the harness not to mention the installation kit/antenna adapters. they also sell 4ga amp kits for over $100, we charge $35 for them and still make profit.

ok i can only remember the cost for the

15"sub $56(retail$299)

6x9 coaxails $16 per pair (retail$99)

tweeters $1.50per pair (retail $30)

Remember these are manufacturing costs, they will obviously vary depending on who makes it and how much volume you order, but i hope this helps and gives you some kind of an idea.

 

[squeak9798 5,000+ posts]

But then look on eBay for the exact same 'X' subwoofer offered by a non-authorized dealer and the cost difference is usually pretty significant. No, you won't get the same manufacturer support that you do buying retail but is that huge markup percentage truly necessary to support the overhead of an authorized dealer? I don't think so, personally.

I don't agree with that at all. You can't compare some guy sitting at his computer in his living room, having the products drop-shipped by some distributor who has zero overhead, other than the monthly internet bill, to a B&M dealer with a commercial location and all the expenses involved there plus expenses associated with having a staff.

 

[Steven Kephart 10+ year member]

I didn't know you guys were in Washington. Hmmmm cool. I'd like to chat w/you about some stuff. I'll PM you later. Probably not today though.

Actually the best thing to do is contact me at skephart@adireaudio.com. I have PM's turned off where I can, and never check the one's I can't. //content.invisioncic.com/y282845/emoticons/wink.gif.608e3ea05f1a9f98611af0861652f8fb.gif

Steven Kephart

Adire Audio