Worth reading.

[Just Thumpin']

At the risk of tossing a political hot potato into the thread, this kind of thing is what is never factored into the equation when our leaders (on BOTH sides of the political aisle) speak about how "great" global competition is. Yes, it is wonderful when you want to buy something inexpensively, but it has also created a world of hurt among our friends and neighbors here at home.

In our small little world of lutherie, we must compete against instruments that are built in countries with no environmental protection, with woods that were probably harvested unsustainably, by workers that make pennies per hour. The resulting instruments sometimes cost $200 or less...less than the COST to my Company of just the preamp in one of our instruments alone.

So the entire price point for things is absurdly distorted and, in the end, while we can all buy things less expensively, many of us do not have the money to afford the things we want (or need) because the value of our work and labor has been so denuded by this wonderful "global competition."

Sorry for the rant!!

J

Thanks, guys!

I pay about $330 per month for my health insurance (I'm 57 and in California). I got mine through joining a small business association, which gets better rates through a group buy. Yes, health insurance is a big chunk of my overhead. It's more than my utilities and auto insurance combined.


Here's another of my posts, copied from the other thread. This may help clarify some of the explanations:

Let me restate the two main points from my post a few pages back, and try to get this thread back on the subject:

1.) I should charge $100/hour. By any rational calculation of my business costs, that's what it would take to cover my overhead and non-billable hours, and leave me taking home a modest income. And most of you would agree that's a reasonable rate, comparing my skills, experience, and shop equipment to other skilled trades.

But:

2.) I can't charge $100/hour. Basses are bought on a fixed price, which is determined by the market. That is, the customers will decide to buy or not buy based on what they think is the value of my bass. And if I take that market valuation price that customers are willing to pay for my bass, and work the numbers backwards, it comes out to $45/hour. That's what customers are actually willing to pay me.

The conflict between those two things is the problem. That's why I build my basses and take home hardly any real pay for my labor.

The four main ways to resolve this are:

1.) Find some way to significantly reduce my overhead, such as a shop with no rent.

2.) Dramatically improve my efficiency by increasing my Billable Hours and reducing wasted time.

3.) Dramatically reduce the labor hours needed to build my basses, without reducing the quality or features.

4.) Significantly increase the selling prices of my basses, and find some way to convince my customers that they are worth it, so that they are willing to pay that much.

You can see how those things are conflicting, particularly 3.) and 4.). It would take major changes of any or all of them to bridge that gap between $45/hr and $100/hr.


And, after another poster suggested that I needed to hire some help, I replied:

Glenn, I disagree. That actually makes things worse. With employees, my fixed overhead costs go up, my efficiency goes down, the labor hours per instrument probably goes up, and the risk factor goes way up.

As I tried to explain in my post about Fodera, with employees, I would be forced to charge $100/hour. I would have to charge $6300 for my basses, and have to produce and sell more per month. That would make my life much harder.

The only reason I'm surviving as I am is because I don't have any employees.

The argument about getting help would apply here IF the market was willing to buy my instruments at prices that work out to $100/hr AND I wasn't able to build basses fast enough by myself to keep up with the demand. But that's not the case here.

 

[tjclem]

so true. I am amazed at how we don't protect our labor force.....

 

[Musiclogic]

There are many reasons for the elevated cost of instruments, and the biggest factor is what the market will bear. Are there a bunch of people that are going to pay $12,000 for a Warwick Steve Bailey "Rusty" or the ridiculous price for the Mike Pope Fodera? No, but there are a few, so instruments like this are geared to those rare sales. There are many more that will spend the $5-7000 for more standardized models, so the product has to be built for the market.

Someone commented about how economical custom basses are compared to other instruments such as violins or cellos? Here is a little insight for you from someone that builds all 3;
The amount of work and the range of skill it takes to build a quality violin or cello goes WAY beyond the skill set used to build a solidbody bass guitar. Most builders of bass guitars could never build a high quality violin, but most violin makers could build a high quality bass guitar. This is an apples to oranges comparative. A relatively standard woodworkers skill set is needed to build a bass guitar, the skills to build a violin go vastly beyond that of a standard woodworkers skill set.

 

[Jeff Bonny]

so true. I am amazed at how we don't protect our labor force.....

And not protecting the offshore labor force too. We're not doing those people any favors with the low wages, unfair and often unsafe working conditions that make a playable $200 instrument possible.

 

[tjclem]

And not protecting the offshore labor force too. We're not doing those people any favors with the low wages, unfair and often unsafe working conditions that make a playable $200 instrument possible.

True.

 

[dremy2006]

Good stuff....