ThePianoMan
500+ Head-Fier
- Joined
- Mar 18, 2014
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Things that need to be considered when setting a price:
1. Cost to purchase the device components
2. Labor to stuff the board, test and program the board, assemble the board in to the chassis, burn in the unit, final testing, cleaning and bagging
3. Cost to package and ship the item
4. Warranty service costs
5. Overhead that is not directly related to the cost of the individual unit: Lease on the warehouse, liability insurance, customer service, advertising
6. Price theory: AKA why does every product cost end with a 9
7. Distribution model: B&M, Direct, some hybrid of the two- each of these models has costs that impact price.
8. R & D (Thanks judmarc)
9. Risk & Profit: Every product that is manufactured at the most essential level is a bet that someone will want to purchase what you produce. You risk losing your investment if you get it wrong. There needs to be a reward when you get it right. Without this, we'd still be a subsistence level species hunting with our hand-made spear chuckers. When James Watt invented the steam engine he wasn't doing it because his wife was out of town and he didn't have anything better to do with his time.
As of summer 2012, everyone was still a contractor. Since nobody had set hours (and everyone came in at fairly bizarre times…hell, Eddie frequently worked from 1AM to dawn), we could kinda squint and get away with it. But I knew that, very soon, someone would say something about it, and we’d be in trouble. We also really, really needed to provide healthcare and all the normal job perks, since we were starting to have employees with families and such. Sounds simple, doesn’t it? Well, stepping into full-boat employee status, tax reporting, and benefits is a very big step. We didn’t make it until January 1, 2013.
Alex tried to combat the heat with a portable air conditioning unit, but it really struggled in the uninsulated space. We mostly used it to keep the products on the burn-in racks from going full Chernobyl. Indoor temperatures of 90+ were common.
"Now, we only had part of the Schiithole (about 1000 square feet) at the time, not the entire building. It was just as crappy, dusty, and miserable as I’ve described. And, as an added bonus, the Santa Clarita summer was on us, bringing 100-110 degree temperatures during the day to a building with no air conditioning and no insulation.
Yeah, Alex pretty much cooked. Eddie, Tony, and I only came in during the evening when we could prop the doors open and run some big industrial fans to circulate the cooler air outside. Alex stayed there pretty much all day, to keep the shipping going.
Alex tried to combat the heat with a portable air conditioning unit, but it really struggled in the uninsulated space. We mostly used it to keep the products on the burn-in racks from going full Chernobyl. Indoor temperatures of 90+ were common."
…and sometimes you get a big surprise.
Like the one that came next.
I think that it's pretty easy to figure out...having seen the coverage of the great schiit flood...what product came out after magni/modi...that had the opposite of a massive undershot in presumed demand?
Loki