GuyDebord;284074 Wrote: > Without mentioning costs like marketing, representation, distribution, > etc. Suddenly the 15 dollars of components are worth so much more, > arent they?
The rule of thumb often used by most analysts is that for the average high-tech company MSRP is generally 3X product cost. (My wife used to work in Investor Relations, so I cribbed this from her). This means a $99.99 product from a high-tech company is assumed to cost about $33 to build. By this rule, a cable with $15 product cost should retail for something closer to $45. Since I work for a publicly traded company in the high-tech sector, I can't comment on the validity of the 3x number. She was pretty adamant that the analysts used it across the board in estimating product costs and that they felt it was pretty accurate, at least for typical high-tech companies. FYI, in the world of products, gross margin % is calculated as: Gross_Margin$ / Total_Sales So for $15 cost and $300 sell price, the gm% is (300-15) / 300 or 95% gross margin. -=> Jim -- JimC "well, she wasn't all of that, but she sure was some of that." -- BKlaas' college buddy ------------------------------------------------------------------------ JimC's Profile: http://forums.slimdevices.com/member.php?userid=9428 View this thread: http://forums.slimdevices.com/showthread.php?t=45323 _______________________________________________ audiophiles mailing list audiophiles@lists.slimdevices.com http://lists.slimdevices.com/lists/listinfo/audiophiles
