Quote:
Originally Posted by StirCrazy
ya they were a couple K, but about 1 to 1.5K of that was probably profit for PFO. I actualy think PFO was stupid and let greed run there release of the solaris, as they new there was a patent aplication but they decided to cash in on it while they could befor the patent was granted, which is viable, but instead of just stopping production when the patent was granted they decided to figh it as the solaris was a cash cow for them..
they were using exhisting extrusions which cost them next to nothing, they were using off shore LEDs which are a fraction of the price of the cree. and they were driving them at lower levels which reduced the requirment for a heat sink. I would be willing to bet including labour there cost was under 500 bucks, and they probably sold the one unit to the stores for about 1700 and then the stores resold for about 2 to 2.5K
If they wouldn't have had as many problems they did with the cheep LEDs burning out they would have made a killing, but they had to many warenty issues which ate into there profit a little to much.
Steve
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I don't think that is a completely fair assessment. PFO used Phillips Luxeon emitters in their fixtures from day one. Now I have spent around $1200 to $1300 so far to buy parts for my DIY 48" fixture and that is with very good volume pricing through the nano-reef group buy for alot of it and also includes a free housing and cheap used heatsinks from eBay.
So I would be surprised if the cost of materials for a Solaris fixture was significantly less than that in 2006 even with their crappy excuses for heatsinks (which were probably responsible for the emitters burning out). now that also doesn't account for the R&D work to create a commercial fixture, tooling for bespoke parts if necessary, labour (even if it is cheap in China), shipping from China (not cheap), and any safety/electrical certification they required in North America. And then you have your operations cost in North America for offices, warehouses, staff etc.
Now normal retail markup is 40% so if the retail was $3500 then the wholesale price from PFO was probably $2100. I don't think it is unusual for a manufacturer to have a markup of 100% over the cost of materials therefore I don't think the pricing was wildly out of line. You may want the manufacturers to have razor thin margins but they won't bother if they can't make any money.