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[TT] Surface gets teardown treatment, costs $271 to build the 32GB model. - Page 3

post #21 of 123

11/5/12 at 10:04am

frankth3frizz
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I see this like the LEXUS LFA, $400,000 car because of engineering and such.

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post #22 of 123

11/5/12 at 10:05am

XNine
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Quote:

Originally Posted by Chakravant

R&D and manufacturing costs are offset by the ridiculous reduction in material costs through bulk wholesale discounts. It likely costs around $271 to make in total.
Most tablets are sold at an insanely high markup. Which is why we need Google and Amazon in this market, to drive prices down to a reasonable level.

No.

How many people here work in the manufacturing business? Show of hands?

When you factor in all of the expenses MS has had to incur just to get this onto a shelf, the profit margin would be extremely small (if they're even making a profit, lord knows MS is the king of selling hardware at a loss just to gain market share). Speculation over what they pay in bulk isn't based on any knowledge or facts. IF anyone thinks otherwise, go ahead. Build one of these from scratch (that includes coding the OS, marketing, R&D, mfg process, etc). Now, make 1 million of them. Yes, your materials cost is lowered, but that doesn't mean they're making an insane profit. In all likelihood, once all of these factors are taken into consideration, you're probably looking at 450 bucks per unit. Maybe more, but I doubt less.

Markup on electronics isn't as high as some people think. It's actually very minimal. Where the real profit is, is accessories like cables, docks, covers, etc.

post #23 of 123

11/5/12 at 10:08am

andrews2547
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Quote:

Originally Posted by XNine

No.
How many people here work in the manufacturing business? Show of hands?

When you factor in all of the expenses MS has had to incur just to get this onto a shelf, the profit margin would be extremely small (if they're even making a profit, lord knows MS is the king of selling hardware at a loss just to gain market share). Speculation over what they pay in bulk isn't based on any knowledge or facts. IF anyone thinks otherwise, go ahead. Build one of these from scratch (that includes coding the OS, marketing, R&D, mfg process, etc). Now, make 1 million of them. Yes, your materials cost is lowered, but that doesn't mean they're making an insane profit. In all likelihood, once all of these factors are taken into consideration, you're probably looking at 450 bucks per unit. Maybe more, but I doubt less.
Markup on electronics isn't as high as some people think. It's actually very minimal. Where the real profit is, is accessories like cables, docks, covers, etc.

Wow, someone on OCN who actually understands how businesses and manufacturing works.

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post #24 of 123

11/5/12 at 10:10am

barkinos98
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Quote:

Originally Posted by frankth3frizz

I see this like the LEXUS LFA, $400,000 car because of engineering and such.

i see that car as a V10 monster

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post #25 of 123

11/5/12 at 10:17am

The Lurking Ninja
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Quote:

Originally Posted by XNine

No.
How many people here work in the manufacturing business? Show of hands?

When you factor in all of the expenses MS has had to incur just to get this onto a shelf, the profit margin would be extremely small (if they're even making a profit, lord knows MS is the king of selling hardware at a loss just to gain market share). Speculation over what they pay in bulk isn't based on any knowledge or facts. IF anyone thinks otherwise, go ahead. Build one of these from scratch (that includes coding the OS, marketing, R&D, mfg process, etc). Now, make 1 million of them. Yes, your materials cost is lowered, but that doesn't mean they're making an insane profit. In all likelihood, once all of these factors are taken into consideration, you're probably looking at 450 bucks per unit. Maybe more, but I doubt less.
Markup on electronics isn't as high as some people think. It's actually very minimal. Where the real profit is, is accessories like cables, docks, covers, etc.

Thank you for having common sense, +1

-Ninja

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post #26 of 123

11/5/12 at 10:21am

Thread Starter

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Quote:

Originally Posted by andrews2547

Quote:

Originally Posted by XNine

No.
How many people here work in the manufacturing business? Show of hands?

When you factor in all of the expenses MS has had to incur just to get this onto a shelf, the profit margin would be extremely small (if they're even making a profit, lord knows MS is the king of selling hardware at a loss just to gain market share). Speculation over what they pay in bulk isn't based on any knowledge or facts. IF anyone thinks otherwise, go ahead. Build one of these from scratch (that includes coding the OS, marketing, R&D, mfg process, etc). Now, make 1 million of them. Yes, your materials cost is lowered, but that doesn't mean they're making an insane profit. In all likelihood, once all of these factors are taken into consideration, you're probably looking at 450 bucks per unit. Maybe more, but I doubt less.
Markup on electronics isn't as high as some people think. It's actually very minimal. Where the real profit is, is accessories like cables, docks, covers, etc.

Wow, someone on OCN who actually understands how businesses and manufacturing works.

He works at NZXT, he has experience

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post #27 of 123

11/5/12 at 10:22am

Chakravant

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Quote:

Originally Posted by XNine

How many people here work in the manufacturing business? Show of hands?

I used to manufacture semi truck tires for Kenworth. It isn't electronics manufacturing, and I don't do it any more. But it does give me insight into profit margin levels and how much cheaper things are with bulk wholesale discounts.

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post #28 of 123

11/5/12 at 10:35am

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This is Microsoft's first tablet. Forgive them for playing it safe.

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post #29 of 123

11/5/12 at 10:51am

paulerxx

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There are other fees.........

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post #30 of 123

11/5/12 at 11:17am

chinesekiwi
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Are you guys forgetting retailer margins? Yes, the retailer margins would be slim, but it's still a factor.
And what Xnine has said. I understand business too having grown up in a family business and worked in electronics retail (different things)..
Brick and mortar retailers often take a loss on say cheaper TVs to clear them. Even newer cheaper TVs (say below US$600) have very little margin on them once they've been in the market for a few months i.e. past the 'initial adopter' stage. (at max $20).
Edited by chinesekiwi - 11/5/12 at 11:23am

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[TT] Surface gets teardown treatment, costs $271 to build the 32GB model.

I honestly love this cooler, but I think I'm gonna move on to another one soon, it just looks... A bit to bland compared to other flaming red (literally) coolers on the market.

Metro 2033 is one of the greatest FPS games ever made. Although not usually recognized as such, due to the horrible state the gaming industry is in, it succeeds largely on its storytelling,...

This is an update of the original Fractal Design Arc Midi. The solid left panel has been replaced by a panel with a plexiglass window and the top USB ports are now USB-3.0. Let me state at the...

I've used this headset extensively for MAG on PS3. The sounds were wonderful, the mic was crisp, and the ability to adjust peoples voice volume is absolutely invaluable. For $100 ( or less ) this...

The Pros The reason this card is one of the better non-Tahiti 7870s is because of Gigabyte's custom PCB. Gigabyte took the 7870 and replaced it's memory chips with Hynix memory so they perform a...

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[TT] Surface gets teardown treatment, costs $271 to build the 32GB model. - Page 3

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