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ReefLove
Guest
rygh said:
It's about cost, GE already produces LEDs so for them adding few more lines would make much sense and cheaper choice than my starting LED manufacturing business. That's all.
bondolo's defunct tanks
- Thread starter bondolo
- Start date
It's about cost, GE already produces LEDs so for them adding few more lines would make much sense and cheaper choice than my starting LED manufacturing business. That's all.
rygh
Guest
Well, yes/no.ReefLove said:
They still have to deal with amortizing all the marketing and sales costs.
And a reef fixture does have some special constraints due to salt water exposure, so might mean more than
just a bit of repackaging on an existing line.
The volumes are still really low.
Perhaps the biggest issue is support. GE is happy selling bulbs and small components.
But selling a full fixture means real end user support. And it is hobbyist end user, not
corporate or business, which is what they have for some other products.
denzil
Guest
BAYMAC said:denzil said:ReefLove said:Thanks Mike. Great info. I just got 105G quote. Expensive. Not sure why things are so expensive. You can get an 60 inch LED TV for $1000 and one kesil light cost $400. Very unfair.I feel this is a rip-off, everything is so expensive. Even mp40 cost $500 and for that much you can buy a laptop or iPad.
On the other hand I understand that corals grow slow and so they are expensive but equipments should be much more cheaper. How can we conserve environment if equipments are so expensive.
Yeah, the markup on the equipment is pretty high. It's basically the Apple model.
Not at all the Apple model of mark-up.
You cannot compare a hundred plus billion industry with one that isn't even a billion. The economy of scale allows them to offer stuff cheaper.
There is not a ton of money in this trade despite what hobbyists think. Margins are tight all around.
Wouldn't the idea be to sell with a smaller margin so that there are (potentially) more units sold resulting in a larger demand of materials which then bring their costs down? I remember MacBook Pro's being cheaper a few years ago and the base model pricing has shifted upward since then. I understand it's a different industry but I'm not entirely convinced that the margins are slim for these electronic devices... If they are, I think there must be a better way for companies to get better reach while still maintaining great husbandry. With those efforts, they could achieve greater profit margins and gradually boost prices up with great justification (great performing product; not to say said products aren't already).
My point is that all companies start small and eventually grow to bigger companies (at least that's what most companies do at varying levels). While economies of scale is a play for any market, I still think that there's still room for improvement in pricing.
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ReefLove
Guest
denzil said:BAYMAC said:denzil said:ReefLove said:Thanks Mike. Great info. I just got 105G quote. Expensive. Not sure why things are so expensive. You can get an 60 inch LED TV for $1000 and one kesil light cost $400. Very unfair.
On the other hand I understand that corals grow slow and so they are expensive but equipments should be much more cheaper. How can we conserve environment if equipments are so expensive.
Yeah, the markup on the equipment is pretty high. It's basically the Apple model.
Not at all the Apple model of mark-up.
You cannot compare a hundred plus billion industry with one that isn't even a billion. The economy of scale allows them to offer stuff cheaper.
There is not a ton of money in this trade despite what hobbyists think. Margins are tight all around.
Wouldn't the idea be to sell with a smaller margin so that there are (potentially) more units sold resulting in a larger demand of materials which then bring their costs down? I remember MacBook Pro's being cheaper a few years ago and the base model pricing has shifted upward since then. I understand it's a different industry but I'm not entirely convinced that the margins are slim for these electronic devices... If they are, I think there must be a better way for companies to get better reach while still maintaining great husbandry. With those efforts, they could achieve greater profit margins and gradually boost prices up with great justification (great performing product; not to say said products aren't already).
My point is that all companies start small and eventually grow to bigger companies (at least that's what most companies do at varying levels). While economies of scale is a play for any market, I still think that there's still room for improvement in pricing.
To say the least, I completely agree. That said, It must be hard for the local fish shop owners because its kind of speciality business. But only way to grow business is to get more tanks build,and that will only happen if the prices comes down. It's no brainier for me.
lattehiatus
Past President
I love the spirit of discussion in this thread and the various perspectives presented!
I am actually not convinced that lowering the cost barrier to entry will actually bring more hobbyists in. Once you are bitten by the reefkeeping bug, the cost of equipment and livestock are not really a deterrent. I am considered to be frugal in most respects, and I love value and stretching a dollar more than most people, but a considerable chunk of my disposable income goes to support this hobby. At the end of the day I know where my priorities are.
The problem with low prices is discussed previously - where does the cost reduction come from? Again if there are companies making money hand over fist in this industry competition is bound to follow, it is simple economics. I know I prefer to support innovation in hardware design and ethical/sustainable livestock collection, rather than cost reduction that has negative trade-offs. A good case in point is "You're complaining about paying $59 for a cardinal fish?"
Personally I believe that the cause and effect are reversed, and I would put forth that more people in the hobby will bring about lower prices with scaling economies. The role of clubs like BAR is to foster education and enable success with reef aquariums. The better you are at reefkeeping, the more likely you are to stay in the hobby, and help others with their new builds. This is how the community grows.
The founders of BAR did the club and the community a huge service by meticulously crafting an appropriate mission statement! Would it not be an admirable (if over-reaching) goal to have every person excited about having and providing the best possible care for aquatic organisms? Awareness and education is the key to success in this hobby - nobody here is born with the skills to keep a successful aquarium, it is all acquired (although some make it look effortless ). IMO what we have is accessible to anyone who has the desire to learn and tenacity to put into practice.
ReefLove said:That said, It must be hard for the local fish shop owners because its kind of speciality business. But only way to grow business is to get more tanks build,and that will only happen if the prices comes down. It's no brainier for me.
I am actually not convinced that lowering the cost barrier to entry will actually bring more hobbyists in. Once you are bitten by the reefkeeping bug, the cost of equipment and livestock are not really a deterrent. I am considered to be frugal in most respects, and I love value and stretching a dollar more than most people, but a considerable chunk of my disposable income goes to support this hobby. At the end of the day I know where my priorities are.
The problem with low prices is discussed previously - where does the cost reduction come from? Again if there are companies making money hand over fist in this industry competition is bound to follow, it is simple economics. I know I prefer to support innovation in hardware design and ethical/sustainable livestock collection, rather than cost reduction that has negative trade-offs. A good case in point is "You're complaining about paying $59 for a cardinal fish?"
Personally I believe that the cause and effect are reversed, and I would put forth that more people in the hobby will bring about lower prices with scaling economies. The role of clubs like BAR is to foster education and enable success with reef aquariums. The better you are at reefkeeping, the more likely you are to stay in the hobby, and help others with their new builds. This is how the community grows.
BAYMAC said:Honestly, anyone that is aligned with the BAR mission statement would take issue with this hobby expanding to every living room in the US, I do and I would greatly profit from such a thing. I put life above profit
The founders of BAR did the club and the community a huge service by meticulously crafting an appropriate mission statement! Would it not be an admirable (if over-reaching) goal to have every person excited about having and providing the best possible care for aquatic organisms? Awareness and education is the key to success in this hobby - nobody here is born with the skills to keep a successful aquarium, it is all acquired (although some make it look effortless
). IMO what we have is accessible to anyone who has the desire to learn and tenacity to put into practice.
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ReefLove
Guest
Well, as far as I'm given promise of my safety in next BAR meet up. I'm willing to continue discussion here. LoL :bigsmile:
I happen to know people who makes LEDs for cosmetic surgery and for skin enhancement. And more or less aware of the cost of production in china. So all I'm saying is even though it makes sense to buy 1500$ worth LEDs, does it really cost that much to make them? And can that money be used in buying something else for hobby, ie bigger coral colonies ? MP40 too I bet costs less than $100. May be even way less. But I guess we would not know whole economy behind price setting because usually in hobbies like golf and Reef keeping, there is the show element too. Like I have to have best golf driver and irons no matter what. Also, mostly people think cheap in price means bad quality and more expensive means better quality, which isn't always true as you know.
I happen to know people who makes LEDs for cosmetic surgery and for skin enhancement. And more or less aware of the cost of production in china. So all I'm saying is even though it makes sense to buy 1500$ worth LEDs, does it really cost that much to make them? And can that money be used in buying something else for hobby, ie bigger coral colonies ? MP40 too I bet costs less than $100. May be even way less. But I guess we would not know whole economy behind price setting because usually in hobbies like golf and Reef keeping, there is the show element too. Like I have to have best golf driver and irons no matter what. Also, mostly people think cheap in price means bad quality and more expensive means better quality, which isn't always true as you know.
lattehiatus
Past President
ReefLove said:
This is a safe place for discussion! Disclaimer: You're protected from anyone I can stop, so that's not saying much.
The way I see it, we're basically talking about the same things, but our cause-and-effect are reversed. You believe that lower prices would result in more people in the hobby, and I believe that more people in the hobby would mean lower prices.
I laughed out loud when I read your words about price and quality, because when I worked extensively with business partners in Japan, I used to poke fun at these colleagues for their mentality of "Why is this so cheap? What's wrong with it?"
Just as a background, I work for an electronics hardware company that incorporates LEDs into its products, with all the manufacturing done in China.I've suggested that cost savings can be both positive and negative. On the positive side, cost savings are driven by optimization and a push towards greater efficiency (technology, upgraded tools, better trained staff, reduction in waste, etc.). This type of cost reduction requires significant effort but the rewards are substantial. On the negative side there is cost reduction driven by the use of cheaper materials, labor, and in some cases design (i.e., knock-offs). Often one of the first things to be sacrificed in the drive towards negative cost reduction is R&D. This is probably more of a critique of what I've seen from upper management making a poor decision for long term viability. If a company has no profits to re-invest, it is the start of the death spiral.
Personally I think it is strange to arbitrarily set a figure for how much something should cost, then work backwards to reach the cost target. For instance, a whole roasted rotisserie chicken can be had at Costco for $5, because someone in corporate decided that $5 was the price that would lead to peak sales and generate traffic. It makes me wonder about the hidden costs incurred, in terms of the environmental impact of industrial farming, the kind of life the animal had, and the long-term effects on the human body of the feed and hormones that were provided to the chicken. Again, I think it's worthwhile to ask "Where is the cost reduction coming from?"
Consequently I am cautious to say that low prices will bring more people into the hobby. If the wrong type of cost reduction occurs, you end up with very frustrated beginners being set back by unreliable equipment and poor quality livestock (come to think of it, it wasn't too different a few decades ago in the hobby!
). The role of clubs like BAR is to spread passion for the hobby and provide a supportive community to provide the best husbandry possible for the organisms in our care. The more successful reefkeepers there are, the more economies of scale come into play to make this hobby more affordable.
BAYMAC
Supporting Member
ReefLove said:
If you ever even in the slightest feel threatened/unsafe/harassed, report it to the BOD and the violator will be moved along. BAR has never allowed for such things to occur, and I've never seen it happen in the nearly 10 years I've been involved with the club
I think discussions like this are excellent as there aren't a ton of people that know subjects like this like those in this thread and it allows them a window into that world
Not to mention it highlighted a few reefers to me, in a good way.
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ReefLove
Guest
lattehiatus said:This is a safe place for discussion! Disclaimer: You're protected from anyone I can stop, so that's not saying much.
This doesn't give me courage
...@BAYMAC..i was just having fun....
I'm a Systems Architect for a company whichis one of the leaders in Business Intelligence, What we do is save lots of money for companies by giving them rapid intelligence into their business using the data they have, usually business intelligence reporting take months and years in some cases to make them perfect and usable, our Software does this in days and weeks. you can have BI reports implemented in days instead of months and this too can be driven by Business not IT. So what it means is that Leaders can get upto-date information and take informed decision in minutes than waiting for someone to generate a report which would take a week. our ROIrate is more than 300% in first year only, in many cases even more.
So, what i'm trying to say is that innovation and investing in latest technology can also lead to cost cutting and making informed decisions will lead to better products and better positioning and also stop wasting money on things that are not necessary etc.
lattehiatus
Past President
ReefLove said:
We are on the same page! Optimization is key.
You need to adapt your company's BI suite to the needs of the marine ornamentals industry and get the sales team to go pounding the pavement.
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ReefLove
Guest
lattehiatus said:ReefLove said:
We are on the same page! Optimization is key.
You need to adapt your company's BI suite to the needs of the marine ornamentals industry and get the sales team to go pounding the pavement.
Well, sales is not something I'm connected to, we are big company and not sure if our inhouse people would knock the doors. But using technology is one way, that's all I'm saying.
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ReefLove
Guest
denzil said:So what kind of Systems Architect are you? Are you familiar with Chef?
Sorry Denzil, didn't get this one.
Familiar with Chef ?
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ReefLove
Guest
BAYMAC said:
I'm in computers, so it's also called software architect.
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ReefLove
Guest
Neared that, but never used it. It's more for on the infrastructure and I'm more on Business Intelligence and software side.
