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Schiit Happened: The Story of the World's Most Improbable Start-Up

Discussion in 'Jason Stoddard' started by jason stoddard, Jan 23, 2014.
  1. Jason Stoddard
    Thanks for answering! Any other takers?
    Schiit Audio Stay updated on Schiit Audio at their sponsor page on Head-Fi.
    https://www.facebook.com/Schiit/ http://www.schiit.com/
    tincanear and Ableza like this.
  2. Ableza
    I await my score, dunce hat at the ready. :wink:
    QueYo and Gazny like this.
  3. sam6550a
    The board porn photo show that the PWB was made by Allfavor, a Chinese company. Is this a new trend for these products to contain costs?
    Paladin79 likes this.
  4. QueYo
    I have a favorite. The black top with the gray base. Doesn't matter which electronics you put in it, that sounds the best to me. Luckily I'm happy with my Vali2.
    ev666il likes this.
  5. Jason Stoddard
    The PCB is assembled in Nevada from a kit sourced by us with a US- and UK-based strategic partner.

    It's possible that the Nevada assembly house is using a Chinese-made PC board, but the PCB isn't being assembled in China. Alex selected this company from a short list of candidates, and has verified they actually produce our products in their factory. He was just out there on Monday.

    That said, we'll contact them and see why they aren't using a US-based company, like most of our other products, but I suspect they are outsourcing the boards for cost reasons. (Which happens even at many US PCB manufacturers as well, sigh.)

    For those of you wondering what all of this is about, there are many ways to have products made:

    1. Buy the product from an ODM in China, complete down to the shipping box. Boxes show up on your doorstep, you ship them out, you support them. You need to have 100% confidence that your design will be produced as intended--no counterfeit parts, no quality slip-ups on the chassis side, etc. There's nothing wrong with this approach, but you're not going to claim "Made" or "assembled' in USA on this one.

    2. Buy a finished, stuffed PCB from an assembly house in China, and mate it with a chassis (also maybe from China, Malaysia, Mexico, wherever). You screw it together. Again, you have to have confidence that no fake parts are going on the PCB, etc. Again, nothing wrong with this approach. This is also legit "Assembled in USA."

    What we do:

    3. Provide a kit of components sourced from the actual suppliers (Vishay, Nichicon, Alps, etc.) to a US-based assembly house, either in California or Nevada. Much of the time we also provide the PCB. In some cases, we provide the assembly house with the PCB files so they can "panelize" the boards to fit their exact requirements in order to keep costs down. We then take in the finished PCBs, test them, mate them with chassis that are produced literally minutes away from us in California. If the PCB has transformers on it, or if there are transformers in the chassis, they are also made in California. Then, after assembly, everything is tested on instruments (Avermetrics, etc) and is listened to. Anything $199 and above gets 1-4 days of burn-in and is tested again.

    This is ALSO legit "Assembled in USA." This is, however, NOT "Made in USA," because we cannot tell you that literally every resistor came from the USA. Yes, this matters to the FTC.

    You can also go beyond what we do, and make your own chassis in house, heck, you can make your own PC boards. Heck, there are tube amp companies that make their own transformers. That's called vertical integration. There's nothing wrong with that.

    But, here's the kicker: you could be making your own boards, chassis, and transformers...and you STILL can't claim "Made in USA!"

    Why? Any manufacturer that cannot prove that literally everything--the cold rolled steel in the chassis, the plastic in the knob, the thin-film resistors on the board, all of it comes from the USA, cannot say "Made in the USA," per the FTC. So if you're making your own transformers, but the laminations come from China, well, that's not made in USA. Or worse, your lamination supplier changed to a Chinese source and didn't tell you. Yeah.

    Hope that clears things up!
    Last edited: Nov 29, 2019
    Schiit Audio Stay updated on Schiit Audio at their sponsor page on Head-Fi.
    https://www.facebook.com/Schiit/ http://www.schiit.com/
  6. sam6550a
    I did this post just to bring it to your attention----you cannot be aware of all happenings in a relatively large organization. The outcome might modify your "assembled in the USA" claim.
  7. Ableza
    Not at all. "Assembled in the USA" means exactly that: The components might be of foreign origin but it was put together in the USA. Even "Made in the USA" means that "all or substantially all" of the components were physically made in the US, but the product might contain some parts of foreign origin. See the Federal Trade Commission web site.
    Jason Stoddard likes this.
  8. Mad Lust Envy Contributor
    I feel like I've owned the Magni 3 for the better part of half a year,

    Jason, Y U DO DIS

    Not that I'm the intended market anymore.

    My next baby is probably gonna be the Asgard 3 or Lyr 3.

    I still gotta do the writeup of the Hel/Fulla 3. I haven't forgotten. It should be done this coming week, all hoping. I hate holding on to loaned gear, but it's been a terrible time for me getting anything done.

    Led inside chassis = god yes.

    If there was one thing, I'd want.... is volume knob on top of all your amps like Asgard and Magnis. I mean, sexy top knobs are best knobs. Anyone who disgarees...fight me. After having the top volume knobs on both the Fulla 3 and HEL, I look at the volume knob on the Magni 3 with disdain.
    Last edited: Nov 29, 2019
    bcowen likes this.
  9. Jason Stoddard
    Nope, see my expanded comment above, where I go into the nuances.

    Yep, and if you want to claim "Made in USA," you better have a very strong stomach. All it takes is one supplier not telling you they're using Chinese steel and you're fried. They really want 100%, and if you want to claim under "substantially all," you better have 100% proof and hope nothing changes. For every product.

    Hence, "Assembled in USA."
    Schiit Audio Stay updated on Schiit Audio at their sponsor page on Head-Fi.
    https://www.facebook.com/Schiit/ http://www.schiit.com/
    Khalaris, ev666il, tincanear and 3 others like this.
  10. bcowen
    ev666il likes this.
  11. Rensek
    Alot of companies have wording in their contracts regarding origin of materials, with their suppliers. Granted many of the companies I deal with are worried about Nafta claims and have to calculate Regional Value Content, net cost, etc. But the safeguards they put into their terms to satisfy Nafta admissibility would transfer over pretty easily to what you are concerned about.
    bcowen and Jason Stoddard like this.
  12. AudioGal
    I'd love the silver top on a purple body.
    US Blues and bcowen like this.
  13. Jason Stoddard
    True, but when it comes down to it, we have to prove it if the FTC comes knocking. Plus, there are exactly zero US manufacturers of thin-film resistors, etc. So it's better to claim "Assembled in USA," and explain what we mean by that on every product page. Makes life a lot more sane.
    Schiit Audio Stay updated on Schiit Audio at their sponsor page on Head-Fi.
    https://www.facebook.com/Schiit/ http://www.schiit.com/
  14. Rensek

    Yes, sorry I was talking irrespective of made in the USA vs assembled in the USA. If origin of components is important to you, your brand, and what the public perception is of your brand then you could put wording in the contracts to reflect that, and help safeguard the things that are important to you. If you have folks traveling to verify assembly, it's obvious it's important to you on some level. How far you want to take it is your call and subject to the limitations of your suppliers. I'm not completely opposed to China (or any other countries) components making their way into yours or anyones products. The supply chain is complicated, and you aren't Samsung.

    That said I like when stuff is made mined/grown/assembled here as much as possible. A better manufacturing base is better for all of us. Any further comment would be deemed politics, so I'll leave it at that.
    tincanear and bcowen like this.
  15. Jason Stoddard
    No, I hear you. But consider this: there are exactly ZERO US suppliers of thin-film SMD resistors (amongst other parts). No amount of wording will get around the fact that there are components that are not made in the USA by anyone. So getting a legit "Made in USA" just isn't possible. You can try to explain it to the FTC. I prefer to minimize my gray hair.

    Agreed on keeping things local and having an actual manufacturing base...which is why we are careful to specify where things are made, literally on every single product page.
    Last edited: Nov 29, 2019
    Schiit Audio Stay updated on Schiit Audio at their sponsor page on Head-Fi.
    https://www.facebook.com/Schiit/ http://www.schiit.com/
    Khalaris, Mike-WI, thebmc and 8 others like this.

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