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JERRY2KONE
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Manufacturing - 03.17.2011, 09:37 AM

With manufacturing such an intricate product as these trucks and buggies there are always design costs, setup costs, production costs, material costs, legalities of running the company, building rent, utilities, equipment, and a whole bunch of other expenses that only a company owner would know and understand that have to be paid for in some manner. These costs get passed on to the customer. When you think about what it takes to manufacture the parts, assembly, electronics, and testing just to get something like this out onto the open market I do not think there is much chance that we will see these selling for much less than they are right now.

I have no idea what the profit is for one of these, but it surely can not be all that much. Which is why the only way these things can pay off is to produce a very large quanity of them. How many is a judgement call that can make or break any companies bank roll. They have to keep initial runs at a reasonable amount so they don't go bankrupt on the very first run just trying to get the product out the door and onto the shelves. If popularity is good, then maybe the second run is a little bit higher. Most companies starting out have to turn every cent of profits right back into the company to keep it running (utilities, payroll, building expenses). It is only after a few years that any of these R/C companies really turn any kind of marginal profit, and that probably is not much. That is the nature of most business. Most of these companies make their profits on replacement parts not the RTR's anyway. Only the very large comapnies can afford to be generous and provide better quality and more bells & whistles as they grow. Even then they have to watch their bottom line just like everyone else out there. I would suspect that in the future we may see better and better quality, but if anything the prices will go up.


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Last edited by JERRY2KONE; 03.17.2011 at 10:05 AM. Reason: ADDING INFO
   
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