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WTF? $ 4500 (you serious?)

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Flake:

--- Quote from: ChadTower on November 14, 2008, 02:32:30 pm ---
Depreciation is different than setup cost.  He wasn't talking about wear and tear on his tools.  He was talking about their retail cost.

--- End quote ---

Your not following me.  Depreciation is how companies "expense" their fixed asset purchases.  When they purchase a fixed asset for long-term use they place that asset on the books and depreciation is a way to systematically expense or "cost" the purchase price of this asset over time.  This expense is not a "setup cost".  Its just part of the overall overhead cost - which does and should get costed into the finished good costing.  A setup cost is a cost incurred, mostly man hours, to change the production process or cycle in one way or another.  And those costs are definitely figured into the cost of the finished good.  Again, if a company ignored setup costs in costing out the finished good then they would be missing a large chunk of the actual cost in producing said good.

Anyway, I digress, in this case I would liken his purchase of tools to a company's purchase of fixed asset machinery.  It is a needed cost to produce the product and the only difference here really is that he is recouping his depreciation expense through one sale in a short time period rather than through several thousand sales over multiple years.

Anyway, if you dont see my point then I thats fine but I give up trying to explain this.  I'm not getting anything done at work.

ChadTower:

--- Quote from: Flake on November 14, 2008, 02:43:58 pm ---  Its just part of the overall overhead cost - which does and should get costed into the finished good costing. 

--- End quote ---

Okay, let's get back to the topic, then... this is a one-off item and not a business.  What you say works in a sustainable business.  He is not one of those.  He can't expect a single customer to bear the entire setup/tooling cost.  It drives his price way too damn high.

mountain:

--- Quote from: ChadTower on November 14, 2008, 02:57:11 pm ---Okay, let's get back to the topic,

--- End quote ---

I think $4,500 is a steal for someone who has no clue how to do it themselves. Will he get it, probably not. I quoted building a cabinet to member on here a few months ago for around the same price. I calculated a labor rate that would make it worth my while and ballparked all of the controls.

I would never pay someone to put new siding, doors, windows, gutters, and roof on my house. So I did it myself a few summers ago. Mainly because I am cheep. Yet there are people that don't have the skills, tools, or time take on such a project. So, they pull out their check books.

The price is fair, just not a reality.

Flake:

--- Quote from: ChadTower on November 14, 2008, 02:57:11 pm ---
--- Quote from: Flake on November 14, 2008, 02:43:58 pm ---  Its just part of the overall overhead cost - which does and should get costed into the finished good costing. 

--- End quote ---

Okay, let's get back to the topic, then... this is a one-off item and not a business.  What you say works in a sustainable business.  He is not one of those.  He can't expect a single customer to bear the entire setup/tooling cost.  It drives his price way too damn high.

--- End quote ---

Dammit your sucking me back in............first off, the issue of market price isnt based on cost, its based on supply and demand.  My explanation of cost is and what goes into that cost is so that companies know how profitable they truly are on a certain product.  If he gets $4500 for this machine than thats the price the market will bear.  

Secondly, a business has several years to recoup that cost and this guy (assuming he is not going into business building cabs - which he might) has only a one time chance to recoup his cost.  If a business knew that they were only going to have a short window to recoup their costs they would make sure the product they are producing has a market value profitablie enough to recoup their manufacturing costs in that shorter window or they wouldnt produce the product.  

Popcorrin:

--- Quote from: uprightbass360 on November 14, 2008, 05:42:48 am ---Due to your overwelming response, it has been reposted at cost. If you would like to see it :

http://seattle.craigslist.org/see/ele/918536125.html

$2700

--- End quote ---

That's a pretty good deal, especially considering the system that's in there.  What brand of monitor are you using?  I assume it is multisync since you are using the arcadevga.

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