By objektivone
Sun Feb 01, 2009 12:44 pm
jaem wrote:objektivone wrote:jaem wrote:
ok great competition.......now as for putting together the capital to manufacture x amount of said drum machine will easily be $200k in China and exponentially more domestically, are they even capable of this?
sorry guys just not a big fan of product announcements on products from unknown entities that are still in development
Its called venture capitalist and investors. If they make this thing good enough people will invest to have it built and shipped, etc. But for now THEY HAVE TO MAKE IT GOOD ENOUGH FOR THAT TO HAPPEN.
if it were only that simple...lol
You don't get VC money for the release of one product in the MI market, the return on the investment is not high enough....
and as a manufacturer with no other products, brand name, and a current share of the market you get zero investment
initial setup costs and prototypes for products like this is easily $50-100k if not more, and then after you fix the hardware bugs you get to layout another $50-100. internal power supply add another $20k for FCC certification. all of this before you even have units manufactured and ready to ship. so with R&D you're looking at half a million easy (to do it right).
if parts cost is $500, they sell direct at $1k retail, thats $500 per unit profit
or 1000 units to break even.....
in 2007 approx 21,000 drum machines were sold in the US (according to NAMM)
say 40k units globally
1k/40k=2.5%
so they would need a 2.5% market share selling direct with no marketing budget to just break even
Like I said, I wish them the best but I don't see how they can bring this to market successfully
Okay, you might be right. I can't argue with some hard statistics. Good call.
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