mains cable rip off

ALL manufactured parts look expensive when one compares to DIY.

Assuming(!) that Isotek did their homework though, you've failed to factor in buying samples of a large range of cables and the huge labour cost of sourcing samples, making them into leads, extended listening test amongst a variety of listeners / systems.

Then, detailed analysis of the critical construcional details of the final cable, and a sensible labour charge to manufacture it, bearing in mind business overheads are greater than the cost of your garden shed and the work above needs to be paid for, with a limited final marketplace where there's plenty of competition.

Of course they may not have done any of that, only your ears will tell you whether it is worth it, or not.

Andy.

P.S. the above is not a defence of Isotek cables, about which I have no experience of any kind.

BTW, have you heard of paragraphs - they make things easier to read

andrew i think all of the above still does not justify a £42.00 mark up.
thats my opinion and i don't work for any of isoteks rival's.
i would have used paragraph's but i was in a rush you english teacher you.

I agree that there seems to be a marked mark-up, however:
1) The 60.14 is less VAT & delivery :-).
2) Do they have to have some sort of certification & insurance to sell mains stuff?
3) Making a cable out of heavy-duty wire is a pain.
4) I think Tough Plugs are 2.55 in B&Q.

Nit-picking aside, like yourself I decided to make up my own leads (there's a thread in DIY). Of course, I've gone off and bought Wattgate & Marinco IEC plugs (£20 each) after trying Schurters and deciding they don't fit too well (unless you tweak them). I haven't tried the Isotek wire, but of course will have to now you've mentioned it.

If you are going to make your own, be prepared for a few rejects and late nights. I've spent DAYS on it (I've just re-wired a 10-socket Olson plugboard with 4mm cable and lots of curses!). If I were to calculate the time I've spent against my hourly rate, I'm sure I could've bought some fairly expensive cables by now.

Can't see what the problem is Minime......why pick on Isotek?Most maufacturers cables can be made for a fraction of the cost if you DIY.What cables are you using in your system?

Cheers,
Paul

home brew ones after seeing them prices i'm glad 2.5mm mains cable 10 amp iec cd 16 amplifier hotplug rf stoppers on both sets mk unswitched wallplugs standard extentsion block for t/table tuners etc. which will be modded soon. no spur because i am waiting to move house.

I would not disagree about huge profit margins for lets face it most manufacturers make the like (rip off Britain and all that) but I would say that I have three Iso-tech cables (both sizes) and am I glad I discovered them, well worth the outlay even if I was over charged? ps Do I get anything (but sarcasm etc) for the longest sentence to appear on this site?

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Originally posted by minime:
i for one will not be buying any of these but will be making my own and calling them meotekk . this is really disgraceful and anyone selling their product should think again .

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It is always amazing to me whenever somebody with no concept of the commercial world wakes up to the hard realities of life relative to retail pricing. For the benefit of minime and anyone else who has never marketed anything (with any prayer of staying in business) let me explain the 1>7 rule. 1 pound at the assembly line results in 7 pounds at retail (or one dollar, sheckle, ringgit, rupee, peso, or beaver pelt, w.h.y.). This formula has been around since the dawn of time, or at least since organized manufacturing and distribution has existed. Some companies are higher (what forum are we on?) but few will survive to see their first corporate birthday cake if it is lower than 1>7.

Since minime has done the maths, it would appear that the retail price of the captioned product is about right (8 x 7 = 56). They probably have a slightly lower cost of the parts than what you or I could get on the open market.

If it is a disgrace, then every commercially successful company is digraceful, including our host. What was the old saying..."he knows the price of everything and the value of nothing!"

minime, get over it. Every time you buy something this rule is in place. Want to really get angry? A tube of toothpaste costs 2 cents to produce (this is a known fact), how much does your toothpaste cost down at Boot's. I guess this will be your next D.I.Y. project (I hear salt works pretty good).

minime - I'd go for 4mm cable, not 2.5.

Prowla,

I can't get 4 mm cable/wire. The thickest cable or flex is 2.5 mm. Is this 4 mm the non-flexible stuff used for sockets etc.?

I was going to make up an extension block as per your DIY post but obviously haven't got too far? Any help mate?

Phil

ok so i am not up to the retail cost of things but let me say this this product has a £42 mark up i am not saying this is the only one what i am saying is their any way isotek or any other company can justify what seems like a very large profit compared to the raw materials. i suppose it's fine if you want to pay for the product and if i saw another product with such a large mark up then i would not buy that product. each to his own i stand by my earlier post this kind of profit is a disgrace and if more people boycotted these proucts then the price would come down to a fairer level.
undertone if i seem angry i am not just a bit shocked at the mark up. if your 1 to 7 ratio is correct if i buy something for 6p does this mean it cost less than nothing to make i think not.

[This message was edited by minime on WEDNESDAY 09 July 2003 at 01:52.]

German Becks alcohol free beer costs nearly a fiver for 6 275ml bottles in Safeways. There is no duty to pay on such a product, and the full 5 abv version in Germany costs about 35p for each 500ml bottle.

Now that's a rip off!

Value for money with ANY hi-fi product is determined by the improvement it brings to your system without the sweat and tears you may pour over it yourself with any supposed short cut.

I didn't regret one minute dropping nearly 600 quid on two pairs of Anthems, but I'd object to paying a fiver for alohol-free beer in my local supermarket.



Regards,

Steve.

[This message was edited by Steven Toy on WEDNESDAY 09 July 2003 at 02:15.]

The 'ol 80-20 principle...

From what I've heard, it seems that these days Audio retailers are making most of their money on aftermarket cables, interconnects, accessories etc...

These items only comprise 20% of the items sold, but produce 80% of the establishment's overall profits!

If you're dealing direct with one of the cable manufacturers, then I imagine a good amount does go towards R+D, maybe advertising and/or packaging... but some of the markups seem to be unreasonable.

I guess that they'll try to "sell the difference" and exploit the audiophiles for whatever the "market will bear". I don't think the 1 to 7 ratio is unreasonable when the initial costs are low ($1 - 10) but, when you have a more expensive base cost (over $10) I think the markup scale has to slide a bit.

E.g. - $70.00 for a cable with $10.00 worth of materials seems pretty fair, $700.00 for $100.00 worth of materials seems rather heavy handed.

Meanwhile, you see numerous cables out there that range way into the $1000's of dollars! I doubt (?) that a $1500.00 cable has $214.29 worth of materials in it. We're talkin' about two (2) connectors and a stretch of wire for God's sake!

I guess it's all relative to how tight your purse strings are!


TNJB

If you own a Naim system then you only have to buy the ridiculously cheap NACA5.
All those aftermarket cables are worse than the cable supplied.

I agree they're a rip-off - cause they don't work!!!

The product is always gonna cost more than the sum of its parts though...

Joe90

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Originally posted by Old Nick:
Anybody want to work out the parts cost of any Naim power, pre or power supply?

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Ooooh, don't go there Nick, you'll scare the children for sure!

Hi Old Nick,
There is a review of the Nait (I think Nait 2) in the TAS archives ..... it was a very positve review by the way, but at the end they did comment on the price (which I think they quoted at USD890) and stated their view that it contained about USD40 worth of parts and USD40 to assemble.

If you accept the 1>7 factor mentioned by another forummer and then add in shipping, customs clearance costs, any taxes the US may add, it's probably not too far off the 1>7 ratio mentioned.

Of course it is not this simple as there are research and development costs, advertising costs, travelling and marketing costs to make dealers etc aware of your product. Plus costs associated with guaranttees and the overhead of carrying spare parts ..... all of this in what a pretty small market. I don't think there can be any complaint at a retail of $890 for such a product. But being (as we all are to some degree) selective about our priorities and values, I wince at the thought that any preamp can ever represent any realisitic VFM at GBP13,000. But of course others will differ and rightly so. I have many friends here who think I'm crazy at the modestly priced system I have but they play golf twice a week at around USD100 per round (not counting the USD2,000 plus they pay for clubs and trundler) and think nothing of it.

Wow, that kind of money would buy my "dream" Naim system and leave me heaps for CD's and I would end up with an asset that still has some value. It all comes down to personal preferences and priorities.

The only difference between small boys and big boys is the price of their toys.

"if more people boycotted these products then the price would come down to a fairer level"
Or the company would go out of business and you wouldn't have the choice.
"if your 1 to 7 ratio is correct if i buy something for 6p does this mean it cost less than nothing to make"
By the ratio it would mean that it cost 6/7 of a penny.
Remember we're talking about luxury goods here. The value is not in the raw materials but rather in the quality of the product (real or perceived). Marketing, support, after-sales and so-on come into play.
A heck of a lot of things have a hefty mark-up: razor blades, champagne, scented candles, Ferraris, restaurants, perfume & aftershave, chocolates, etc.
In this case you're lucky because you can probably make an equivalent product for less. That doesn't necessarily mean the commercial product is a rip-off but rather it reflects the real world.

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Take the nap500

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That's a good example - Julian Vereker is on record stating that the power transistors used in this design date back to 1987.

Now whilst Naim weren't working on the design at that point, it gives an indication of the potential gestation periods of such a product, as the R&D knowledge required to be able to use such devices advances.

The NAP500, the first production amp to use these devices was not released until 2000.

Andy.

Look inside the boxes. Whaddayasee? Transformer, circuit boards - not much really. Computer motherbooards cost from £80 and they are being constantly redesigned - so why does a Naim amp that has a ten year run cost so much? Rip-off.
I went to the factory for a tour and to see how it all goes together.
When I came out I was wondering how they can make this stuff for the price. Really. Labour time is huge. Painstaking component matching is bordering on the fanatical. This is hand built stuff. Its cheap.

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....Its cheap

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I agree with everything up to that point.

You can never call it cheap though, some peoples perspectives are skewed somewhat.

Good value would be a more accurate description.

Andy.

Minime

Actually mr. undertone seems wrong to me - it's more often 1>10 nowadays.

Whether it's a preamp or an IEC cable the ratio remains fairly (if not completely) constant. You are seeing the cost of the raw components only. You fail to take into the massive overheads that add to the price of each component in your piece of equipment. These include things like Production, R&D, Marketing, Sales, Warrantying, CE certification (and all the other certifications around the world to show the equipment conforms to their standards), backup, packaging (hugely expensive) etc.

It's not nice and it's not pretty, but if you want the same level of service to backup your product that guarantees it won't break next year, or that it will be fixed when it does break, or that you will get redress from the company or government when it causes you damage, then you have to accept that there is an associated cost with having those safeguards.

Regards,
Frank.
All opinions are my own and do not reflect the opinion of any organisations I work for, except where this is stated explicitly.

It's so easy.

If you don't like the price don't buy - but for feck's sake stop bitching about it.

cheers

Nigel

Some time ago I designed a small electronic product for a specialist market. When I looked into the cost of manufacturing, marketing and selling it my conclusion was that I would have to sell it for 8 X the material cost to make enough money for it to be worthwhile. I had previously thought that similar products were vastly overpriced - this was why I had a go myself. My design would have to sell at the same price as existing products so I abandoned the idea.
The only electronic products where the material cost is close to what the general public would expect are high-volume, commodity type products (i.e. Computer mother boards).

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I'm so sick and tired of people that always rely on this usual response when people don't agree on something. It's not that people, as you put it,are (bitching) about it. We are just pointing out facts. Why is it so painful for people like Mr Cavendish to hear different points of views?

OK , sir, now that we know you are an arse kisser, and accept EVERYTHING that is told to you as fact, I have some land in Florida I could sell you cheap, It's beachfront property worth about a million dollars, I'll let you have it for a song

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Mad Max, eh? ain't that the obvious truth.

1. So it's a fact? Well even if it is why bitch about it? You are not going to change a thing.

2. It is not painful it is just boring.

3. I don't kiss arses, unless paid more money than you could even dream of, nor do I accept EVERYTHING. I don't buy at rip-off prices. And I don't bitch about not doing so.

4. Florida? Who in their right minds would choose to live there, or Chicago for that matter. If, however, you have a genuine business offer...?

cheers

Nigel

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Good value would be a more accurate description

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Well...cheap = good value.
Try applying your own hourly rate to the man hours put into these products. Whhooaaa..

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Originally posted by Frank Abela:
Minime

Actually mr. undertone seems wrong to me - it's more often 1>10 nowadays.

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You are absolutely right Frank, the 1>7 ratio is a production engineering ratio which should cover all the costs of running a company in the BLACK. Once this number is worked up, it is then handed to the marketing department to see if it can be expanded (or if it's too high), let me give you an example. The cost at the end of the assembly line has been established at 10 pounds. Using the 1>7 ratio, 70 pounds is the target retail, however, there are 7 other companies making a similar product. Current "street retail" of this product is 129 pounds. The marketing department can now increase the price anywhere between 70 and 129 pounds depending on the marketing plan. Not all of the difference (in this case, potentially 59 pounds) is necessarily "disgraceful" profit. They may decide to plow 20 pounds per unit into a higher level (ie: more expensive) of advertising like TV, to reach a wider target audience. Or they may decide to purchase a new and expensive machine that will, over time, reduce the cost to 7 pounds at the end of the assembly line. Or build an extension on their building, develop a new product, or sponsor a Formula 1 team, whatever. When you see a pair of Nike shoes in a shop for 150 pounds endorsed by Michael Jordan or Tiger Woods who have been paid Millions for their endorsement, you see this marketing concept in operation in its most "maxed-out" form. People go into business to try to stay in business and be successful. They must conform to the economic basics.

I have been building my own amplifiers, loudspeakers, cables, turntables, and all types of electo-mechanical devices for most of my life. There is no question I can build a higher quality product for myself for less money than I could buy a commercially made one off the shelf, but I couldn't start making them to sell for that same price.