(Only cars really have more value in individual parts than unit as whole)
Aren't you going on retail price? If you go by small volume / retail price on parts, then everything has more value in individual parts than the whole unit.
Aren't you going on retail price? If you go by small volume / retail price on parts, then everything has more value in individual parts than the whole unit.
Sure, but it is car more prevolent in the Auto Industry, I guess Microsoft sold a lot of XBoxes and Zunes for a loss as well, trying to artificially create demand. The iPod Touch does have a around a 180% markup based on those numbers, but really, that isn't as bad as a lot of other things, say for instance....
You buy a 20 oz Coke at a restaurant for something like $2.00, that Coke only cost the restaurant a nickel. So that is a 4000% markup. My dining room table analogy is 667% markup, look at any Amish built furniture you will see those numbers easily. Something from Ethan Allan might be closer to 1000% markup. This is purely based off material cost. Except the Coke that already has the labor figured in.
Sure, but it is car more prevolent in the Auto Industry, I guess Microsoft sold a lot of XBoxes and Zunes for a loss as well, trying to artificially create demand. The iPod Touch does have a around a 180% markup based on those numbers, but really, that isn't as bad as a lot of other things, say for instance....
That's not what I mean.
Try to buy single piece quantities of an iPod hard drive, a replacement screen, touch pad or other major pieces of the device. The cost can add up quickly, beyond the cost of getting a new one. It's the same thing as trying to put together a car buying the parts in single piece quantities. It's more visible for cars because very few people seem to bother fixing consumer electronics because they're so cheap, not many people can replace a car so easily. Buying a new hard drive for a 5th gen iPod is probably more expensive than buying a used, fully functional iPod, the suckers drop in value at an astonishing rate.
Quote:
You buy a 20 oz Coke at a restaurant for something like $2.00, that Coke only cost the restaurant a nickel. So that is a 4000% markup. My dining room table analogy is 667% markup, look at any Amish built furniture you will see those numbers easily. Something from Ethan Allan might be closer to 1000% markup. This is purely based off material cost. Except the Coke that already has the labor figured in.
Raw materials is different than finished component. A log in the woods isn't worth much, but a replacement leg for a chair has quite a few steps to get there.
Try to buy single piece quantities of an iPod hard drive, a replacement screen, touch pad or other major pieces of the device. The cost can add up quickly, beyond the cost of getting a new one. It's the same thing as trying to put together a car buying the parts in single piece quantities. It's more visible for cars because very few people seem to bother fixing consumer electronics because they're so cheap, not many people can replace a car so easily. Buying a new hard drive for a 5th gen iPod is probably more expensive than buying a used, fully functional iPod, the suckers drop in value at an astonishing rate.
The story is about the "high" margin, My point was that at 180% it is hardly the margin of 4000%, It doesn't matter at all what industry it is. If the iPod touch had the same margin as Coca-Cola the thing would cost over $6000. I'm questioning who determines that the margin is high? You'll find no less of a margin in many products made my Sony, Bose, or even Tiffany & Co. Apple is a premium brand that is what you get. The story talks about the cost of the components going into the unit as compared to the final cost, they don't take into account the labor, R&D, shipping, or the fact that the cost of all those components fluctuate daily, especially Flash memory. They built all of that into the cost to the end user. My original point about the Automobile industry points out that it is probably the only industry where these basic rules don't apply. Remember GM sold cars to everyone at the employee price, they sold a record number of cars and still managed to lose 8.6 Billion dollars.
Let's not let up on AppleInsider for this type of shoddy reporting...
There is valuable information in iSuppli's numbers. However they are far from a complete costing and should not be used as a sole source of costs when computing margins.
The rest of the story is good. But please stop reporting this margins crap based purely on component costs.
I have plenty of love for you. But I'll be back here to ridicule the reporting whenever it stoops to this level of inaccuracy and sensationalism.
[QUOTE=echosonic;1186294]it will never cease to amaze me how some people will find a reason to gripe no matter what. First, its that the PRICE is too high. No SALES....then they have a sale but it isnt GOOD ENOUGH a sale to make you happy.
customers have a right to make the decision to buy or not buy.
customers do not have a right to set the price.
so far, each successive fiscal quarter has proven that more customers are opting to buy than the year before.
pretty simple indicator that Apple is doing it right.[/QUOTE
It never ceases to amaze me how some people will never admit Apple has done anything wrong ever in any way. Apple's black Friday "sale" is actually what brought their stinginess to my attention. I was all excited to see large discounts (its the first Black Friday sale I've ever paid attention to with Apple) the discounts were sad quite frankly. As for pop being sold at 4000 percent or whatnot yea I believe a large Coke at McD's costs about 12 cents in syrup, and percentage wise 3 bucks might be a lot more than that but its still only 3 bucks, things that are super cheap can't have 10 percent profit margins because that would amount to pennies and be pointless to sell. Basically I don't understand why Apple doesn't want to put an emphasis more on getting people to use their products- they have a ton of cash on hand, they are making a lot of money with these margins even if they aren't as high as reported they are still making a lot of money on each product. It wouldn't kill them to have the occasional sale to get some customers.
it will never cease to amaze me how some people will find a reason to gripe no matter what. First, its that the PRICE is too high. No SALES....then they have a sale but it isnt GOOD ENOUGH a sale to make you happy.
customers have a right to make the decision to buy or not buy.
customers do not have a right to set the price.
so far, each successive fiscal quarter has proven that more customers are opting to buy than the year before.
pretty simple indicator that Apple is doing it right.[/QUOTE
It never ceases to amaze me how some people will never admit Apple has done anything wrong ever in any way. Apple's black Friday "sale" is actually what brought their stinginess to my attention. I was all excited to see large discounts (its the first Black Friday sale I've ever paid attention to with Apple) the discounts were sad quite frankly. As for pop being sold at 4000 percent or whatnot yea I believe a large Coke at McD's costs about 12 cents in syrup, and percentage wise 3 bucks might be a lot more than that but its still only 3 bucks, things that are super cheap can't have 10 percent profit margins because that would amount to pennies and be pointless to sell. Basically I don't understand why Apple doesn't want to put an emphasis more on getting people to use their products- they have a ton of cash on hand, they are making a lot of money with these margins even if they aren't as high as reported they are still making a lot of money on each product. It wouldn't kill them to have the occasional sale to get some customers.
So you want Apple to sell at a loss then? Computers, even Apple computers, have a very, VERY tight margin, I work at a retail store that sells Macs and our margin for a Mac is only about 4%. That's right the government gets more in sales tax. It has been consistent for me for years now that the only thing I can get very deep discounts on are XServes I got nearly $1500 off the last XServe I bought. If you want a deal, buy a refurbished Apple product from Apple, they carry the same warranty a new one does and you know they have undergone more rigorous testing before sale. Apple has never run "sales" the best way to get deals is buy a closeout model from MacMall or get yourself an Apple sales rep, that is how I saved $1500 on the XServe.
You would think apple could maybe have one of those things- what is that, oh yea, a sale. A discount of some sort at some time maybe? Nevermind Apple will never drop the price of anything for any reason.
Didn't they knock $100-$200 off the price of the iPhone?
So you want Apple to sell at a loss then? Computers, even Apple computers, have a very, VERY tight margin, I work at a retail store that sells Macs and our margin for a Mac is only about 4%. That's right the government gets more in sales tax.
That's the margin that Apple offers to retailers, they're known to be stingy to retailers like that. I think Apple's side of the equation is considerably more.
The story is about the "high" margin, My point was that at 180% it is hardly the margin of 4000%, It doesn't matter at all what industry it is. If the iPod touch had the same margin as Coca-Cola the thing would cost over $6000. I'm questioning who determines that the margin is high?
I think the per industry comparison is correct. Comparing margins between different industries makes no more sense than comparing the buyer's price of two different kinds of products. If I can buy a Coke for $2, then why does Apple charge $599 for a Mac?
Comments
(Only cars really have more value in individual parts than unit as whole)
Aren't you going on retail price? If you go by small volume / retail price on parts, then everything has more value in individual parts than the whole unit.
Aren't you going on retail price? If you go by small volume / retail price on parts, then everything has more value in individual parts than the whole unit.
Sure, but it is car more prevolent in the Auto Industry, I guess Microsoft sold a lot of XBoxes and Zunes for a loss as well, trying to artificially create demand. The iPod Touch does have a around a 180% markup based on those numbers, but really, that isn't as bad as a lot of other things, say for instance....
You buy a 20 oz Coke at a restaurant for something like $2.00, that Coke only cost the restaurant a nickel. So that is a 4000% markup. My dining room table analogy is 667% markup, look at any Amish built furniture you will see those numbers easily. Something from Ethan Allan might be closer to 1000% markup. This is purely based off material cost. Except the Coke that already has the labor figured in.
Sure, but it is car more prevolent in the Auto Industry, I guess Microsoft sold a lot of XBoxes and Zunes for a loss as well, trying to artificially create demand. The iPod Touch does have a around a 180% markup based on those numbers, but really, that isn't as bad as a lot of other things, say for instance....
That's not what I mean.
Try to buy single piece quantities of an iPod hard drive, a replacement screen, touch pad or other major pieces of the device. The cost can add up quickly, beyond the cost of getting a new one. It's the same thing as trying to put together a car buying the parts in single piece quantities. It's more visible for cars because very few people seem to bother fixing consumer electronics because they're so cheap, not many people can replace a car so easily. Buying a new hard drive for a 5th gen iPod is probably more expensive than buying a used, fully functional iPod, the suckers drop in value at an astonishing rate.
You buy a 20 oz Coke at a restaurant for something like $2.00, that Coke only cost the restaurant a nickel. So that is a 4000% markup. My dining room table analogy is 667% markup, look at any Amish built furniture you will see those numbers easily. Something from Ethan Allan might be closer to 1000% markup. This is purely based off material cost. Except the Coke that already has the labor figured in.
Raw materials is different than finished component. A log in the woods isn't worth much, but a replacement leg for a chair has quite a few steps to get there.
That's not what I mean.
Try to buy single piece quantities of an iPod hard drive, a replacement screen, touch pad or other major pieces of the device. The cost can add up quickly, beyond the cost of getting a new one. It's the same thing as trying to put together a car buying the parts in single piece quantities. It's more visible for cars because very few people seem to bother fixing consumer electronics because they're so cheap, not many people can replace a car so easily. Buying a new hard drive for a 5th gen iPod is probably more expensive than buying a used, fully functional iPod, the suckers drop in value at an astonishing rate.
....was going to continue, but what's the point.
High Fructose Corn Syrup is NOT raw materials.
High Fructose Corn Syrup is NOT raw materials.
That not even in a comparable industry anyway.
That not even in a comparable industry anyway.
The story is about the "high" margin, My point was that at 180% it is hardly the margin of 4000%, It doesn't matter at all what industry it is. If the iPod touch had the same margin as Coca-Cola the thing would cost over $6000. I'm questioning who determines that the margin is high? You'll find no less of a margin in many products made my Sony, Bose, or even Tiffany & Co. Apple is a premium brand that is what you get. The story talks about the cost of the components going into the unit as compared to the final cost, they don't take into account the labor, R&D, shipping, or the fact that the cost of all those components fluctuate daily, especially Flash memory. They built all of that into the cost to the end user. My original point about the Automobile industry points out that it is probably the only industry where these basic rules don't apply. Remember GM sold cars to everyone at the employee price, they sold a record number of cars and still managed to lose 8.6 Billion dollars.
There is valuable information in iSuppli's numbers. However they are far from a complete costing and should not be used as a sole source of costs when computing margins.
The rest of the story is good. But please stop reporting this margins crap based purely on component costs.
I have plenty of love for you. But I'll be back here to ridicule the reporting whenever it stoops to this level of inaccuracy and sensationalism.
customers have a right to make the decision to buy or not buy.
customers do not have a right to set the price.
so far, each successive fiscal quarter has proven that more customers are opting to buy than the year before.
pretty simple indicator that Apple is doing it right.[/QUOTE
It never ceases to amaze me how some people will never admit Apple has done anything wrong ever in any way. Apple's black Friday "sale" is actually what brought their stinginess to my attention. I was all excited to see large discounts (its the first Black Friday sale I've ever paid attention to with Apple) the discounts were sad quite frankly. As for pop being sold at 4000 percent or whatnot yea I believe a large Coke at McD's costs about 12 cents in syrup, and percentage wise 3 bucks might be a lot more than that but its still only 3 bucks, things that are super cheap can't have 10 percent profit margins because that would amount to pennies and be pointless to sell. Basically I don't understand why Apple doesn't want to put an emphasis more on getting people to use their products- they have a ton of cash on hand, they are making a lot of money with these margins even if they aren't as high as reported they are still making a lot of money on each product. It wouldn't kill them to have the occasional sale to get some customers.
it will never cease to amaze me how some people will find a reason to gripe no matter what. First, its that the PRICE is too high. No SALES....then they have a sale but it isnt GOOD ENOUGH a sale to make you happy.
customers have a right to make the decision to buy or not buy.
customers do not have a right to set the price.
so far, each successive fiscal quarter has proven that more customers are opting to buy than the year before.
pretty simple indicator that Apple is doing it right.[/QUOTE
It never ceases to amaze me how some people will never admit Apple has done anything wrong ever in any way. Apple's black Friday "sale" is actually what brought their stinginess to my attention. I was all excited to see large discounts (its the first Black Friday sale I've ever paid attention to with Apple) the discounts were sad quite frankly. As for pop being sold at 4000 percent or whatnot yea I believe a large Coke at McD's costs about 12 cents in syrup, and percentage wise 3 bucks might be a lot more than that but its still only 3 bucks, things that are super cheap can't have 10 percent profit margins because that would amount to pennies and be pointless to sell. Basically I don't understand why Apple doesn't want to put an emphasis more on getting people to use their products- they have a ton of cash on hand, they are making a lot of money with these margins even if they aren't as high as reported they are still making a lot of money on each product. It wouldn't kill them to have the occasional sale to get some customers.
So you want Apple to sell at a loss then? Computers, even Apple computers, have a very, VERY tight margin, I work at a retail store that sells Macs and our margin for a Mac is only about 4%. That's right the government gets more in sales tax. It has been consistent for me for years now that the only thing I can get very deep discounts on are XServes I got nearly $1500 off the last XServe I bought. If you want a deal, buy a refurbished Apple product from Apple, they carry the same warranty a new one does and you know they have undergone more rigorous testing before sale. Apple has never run "sales" the best way to get deals is buy a closeout model from MacMall or get yourself an Apple sales rep, that is how I saved $1500 on the XServe.
You would think apple could maybe have one of those things- what is that, oh yea, a sale. A discount of some sort at some time maybe? Nevermind Apple will never drop the price of anything for any reason.
Didn't they knock $100-$200 off the price of the iPhone?
Or was it $300.....I don't remember exactly.
So you want Apple to sell at a loss then? Computers, even Apple computers, have a very, VERY tight margin, I work at a retail store that sells Macs and our margin for a Mac is only about 4%. That's right the government gets more in sales tax.
That's the margin that Apple offers to retailers, they're known to be stingy to retailers like that. I think Apple's side of the equation is considerably more.
The story is about the "high" margin, My point was that at 180% it is hardly the margin of 4000%, It doesn't matter at all what industry it is. If the iPod touch had the same margin as Coca-Cola the thing would cost over $6000. I'm questioning who determines that the margin is high?
I think the per industry comparison is correct. Comparing margins between different industries makes no more sense than comparing the buyer's price of two different kinds of products. If I can buy a Coke for $2, then why does Apple charge $599 for a Mac?