Quote:
Originally Posted by Slidefox
(Post 25008)
Another reason these JDM manufacturer's price there kits so high is to prevent copying. Your paying for exclusivity. Veilside is a prime example with there Fortune Kits. You have to purchase the entire kit. No one piece can be ordered individually. One price... One Part#
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Well, if you think about it, high pricing achieves the opposite to what you are saying. If you set the price high, then that leaves a good margin for people to make by copying it. If the kit is 4k and I can buy it and make copies and sell the copies at 2k..you have a business. However, if you make the original product more accessible, you will 1) increase your volume of sales and 2) discourage people from copying it because there isn't enough margin to justify the effort.
Quote:
Originally Posted by 370Ztune
(Post 25176)
JDM pricing is always the debate, but I think it's because the average consumer interested in these products doesn't understand the costs of engineering quality as good as an Amuse product, Zele, Sunline, MCR, etc.
The R&D alone can be absurd but factor in simple business economics... let's say a part takes $30,000 for R&D and making a mold to produce the parts. On a 350Z the market might allow sales of 100 units to make back the production costs and make some profit. With a smaller market like the 370Z or G37, total unit sales might be only 30-40% of the volume of the older Z, simply there are less cars and less people modifying right now. If only 30-40% of the volume is there, there is simply no way to recoup the investment cost unless each piece is more expensive. Just simple economics really.
Take for example the GT-R, or even GT3 Porsche, tuning parts are limited editions because the audience is so small compared to other cars people often compare pricing to (Z/G, S2000, EVO, etc). It's a very hard comparison to make. This probably deserves a separate blog post because the topic comes up a lot. Just my two cents!
-Jeff
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This isnt a GT-R or a GT3. There will be tons of Z's on the road as time goes by, just like there are tons of 350Z's out right now. OK yeah they want to make back their money, however by that logic they should sell just one kit at 30K and call it a day. That is just being extreme. The point is, you have to strike a balance price that allows you to make back your R&D costs while maintaining a SUSTAINABLE business. I think they have grossly over-estimated that balance price and that OK, a few people are going to buy the kit, but you are really limiting your market by setting the price so high. Slidefox brings up the point of exclusivity... yeah its going to be super exclusive because this car's target audience, in general, isnt the super wealthy. Most of the people who buy this car, can't afford a $5000 body kit, if they could, they might have bough a Porsche GT3 or a GT-R in the first place. By that logic, companies are better off sacrificing some exclusivity and I don't mean much, in exchange for a sustainable business model. You could price the same kit at $3000 and it would still be plenty exclusive in this market, yet it would allow them to cover costs quicker and make money in the long run... |
