An incredible challenge posted by Audeze official - will Dan, Sennheiser and Focal step up?
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This is real. This isn't a hoax. Attached is a screenshot from the Audeze LCDi4's Amazon page. Transcribed below: Buyer Question: How much do these headphones cost to manufacture? I'm curious what the markup is
Audeze's Response: No problem - just ask Sennheiser, Focal, HiFI Man, Beyer, and Mr. Speakers what their BOM costs are and send it to Audeze, and we'll post our information. (Note from me - BOM = bill of materials) You can see by the SELLER label this is the actual reply from Audeze official. Audeze has since deleted the comment, but I was amazed to see someone both bold enough to ask this question, and Audeze being bold enough to reply. I screenshotted the comment not realizing they later deleted the reply, immortalizing it forever. I think Dan of Mr. Speakers lurks Massdrop, and maybe others do too. What do you say? Can we get sign-offs from the major players to agree to post their production costs? Audeze has issued this incredible challenge, who will step up?
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thumb_upDavid Dobie, c_dubb, and 3 others
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dm94aq7
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ElectronicVices
2207
Mar 31, 2020
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The absurdity of this inquiry is mind-boggling.
Mar 31, 2020
dm94aq7
38
Apr 2, 2020
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Things that are mind boggling: Things that aren't mind boggling:
  • 1. Curiosity about extreme markup
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Apr 2, 2020
ElectronicVices
2207
Apr 3, 2020
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Curiosity isn't mind-boggling, having even the smallest expectation that this might happen is the mind-boggling part. Where do you get the idea that materials cost is ever high a high percentage for complex goods? Ever hear that the whole is greater than the sum of its parts? The other aspect that most of the people making these types of requests fail to ever account for is the overhead and R&D that goes in to making products with more than a couple parts. Combine those expenses with the relatively small market for high-end headphones and you get the cost structure we see today. If anyone is looking to TOTL or high end headphones for a strong value proposition needs to re-evaluate their thought processes, because that is never going to happen. This is a niche luxury market, not something usually associated with cost effectiveness. Luxuries are never a good value, that's inherently why they are considered luxuries.
Apr 3, 2020
Evshrug
1647
Mar 30, 2020
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Would you look Vincent Van Gogh or Claude Monet in the eye, and ask them how much the paint and canvas cost them?
Mar 30, 2020
Ripter
0
Apr 23, 2020
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Apr 23, 2020
Evshrug
1647
Apr 23, 2020
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Hang on, I’ll ask for you... Vincent: “My ear.” Monet: “My eyes.”
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No one asked you, Gimli!
Apr 23, 2020
dm94aq7
38
Mar 30, 2020
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@Evshrug Audeze issued this challenge on the i4 page, where the BOM is more than a "couple times" the cost of materials. I think it's a valid question
Mar 30, 2020
Evshrug
1647
Mar 30, 2020
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It’s a question alright. I really doubt Audeze expects other headphone manufacturers to chime in, and so it was “safe” for them to say, essentially, “If you can get them to share their BOM, then we will.” If you read between the lines, they’re saying the other companies don’t and won’t disclose that information. Again, people will look at the materials cost out of context. At the end of the day, the BOM cost doesn’t matter at all. So what if, say, HiFiman HE-400 S materials cost the same as an HE-6SE? I value the HE-6SE more. Also, the first units off the line for a new headphone (especially for a new company) cost way more than the headphone of equal quality down the line, once the process is optimized and economies of scale kick in.
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Mar 30, 2020
Evshrug
1647
Mar 30, 2020
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This is NOT a challenge from Audeze... you could call it a rhetorical comment to show that no manufacturer is going to disclose their BOM. Frankly, consumers would misunderstand, and the cost of materials is besides the point. Headphones are not like basic carpentry nails or lumber. It is both a highly developed and highly researched science, AND an art. So, cost of materials is besides the point. Maybe Sennheiser’s resin they use to make the earcups of the HD 800 S is inexpensive (I don’t know the cost), BUT they researched it (I think they developed it in-house) specifically because of its low resonance and lightweight properties. Maybe it doesn’t cost Sennheiser any more to set the drivers at an angle, or the cost of the 56mm driver is a miniscule increase over something smaller, or the absorber in the HD 800 S that prevents masking is cheap, but a BOM doesn’t take into account the years of experimentation, iteration, and unique inspiration of the designers behind it. And then there’s operating costs of companies. Margins are an absolutely required part of doing business. The materials and construction labor per unit cost of a headphone doesn’t take into account R&D the the current product or future ones, nor does it pay for marketing, shipping logistics, etc. A company is simply larger than a single product. I don’t want to be price gouged either, nobody does. If I want something, an attainable, affordable price is necessary for me to buy it, and I don’t want something that appears to cost way more than it’s peers in the market. Value and BOM are completely separate things for most products on the market. So, I know it’s going to cost me a couple times more than the cost of materials.
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Mar 30, 2020
dm94aq7
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Mar 30, 2020
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@MrSpeakers @Sennheiser any comment?
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Mar 30, 2020
erickong
4787
Audiophile Moderator
Mar 29, 2020
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This is interesting
Mar 29, 2020
Davestef
131
Mar 29, 2020
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Haha wow. That could go for any high end/luxury brand. Like how much does an Hermès bag cost to make? joshua valor has a YouTube post called the flagship tax. About how companies jack up the prices so much for their high end gear.
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Mar 29, 2020
Evshrug
1647
Mar 30, 2020
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How much for a chair compared to a pile of wood, some nails, and varnish?
Mar 30, 2020
jaxtrauma
418
Mar 31, 2020
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Yep, you’re paying for expertise
Mar 31, 2020