Path: utzoo!utgpu!news-server.csri.toronto.edu!rutgers!apple!vsi1!zorch!xanthian From: xanthian@zorch.SF-Bay.ORG (Kent Paul Dolan) Newsgroups: comp.sys.amiga Subject: Re: An issue for the entire Amiga Community. Message-ID: <1990Jun17.024600.826@zorch.SF-Bay.ORG> Date: 17 Jun 90 02:46:00 GMT References: <141@cbmcel.UUCP> <30762@cup.portal.com> Organization: SF Bay Public-Access Unix Lines: 67 In article <30762@cup.portal.com> Classic_-_Concepts@cup.portal.com writes: [This next part was mine, but my article isn't in the references nor was I attributee here - xanthian] >> I even bought one eminently playable game for $15.00 early in my Amiga's >> career .... except for profits, the cost of getting that game to me was >> the same as the cost of getting that $45.00 game .... I have decided to >> start focusing my attention on the $30.00 and under market. If enough >> folks did the same ... > >Sorry, so many logical flaws here I feel rather compelled to respond. > >How can you possibly assume that development, research, packaging, distribu- >tion costs are equal from one situation to another? There are wide diver- >gences in development time (a year, 2 weeks, 3 years). There are wide >divergences in support costs (1-800, long distance, upgrades, etc.). There >are wide divergences in manufacturing costs. A company with a dozen products >can get volume discounts on labels, diskettes, boxes, etc. A small company >with one product cannot. Packaging can cost them 2 to 3 times as much as >the cost to a large, established company. To the contrary, this game was from a hole in the wall company I never had heard of, but which had several games in a rack at a store I was in, all in the same price range. Being small, I must assume that all the "economies of scale to which you refer above were working _against_ them, not for them. 800 level phone support for a game is ludicrous! It is just such poor judgement on the part of management that continues to escalate the distribution costs of games. Wide divergences in manufacturing costs point right back to rotten management, with no interest in providing a cost controlled product to the customer. As long as we keep paying outrageous prices, companies will keep finding ways to charge them and justify them. >You also made a very large unsupported assumption. You assumed the $15.00 >game was commercially viable and therefore that everyone could sell products >in this price range. Bzzzt, wrong. The low price tag could reflect poor >business practices. It could reflect a company not viable over the long >term. It could be a loss leader to get people in the store, or to notice >the company, or ... The game was certainly commercially viable _to me_! The price was a large factor in my buying decision. It is the _high_ price tag that indicates poor business practices; if Joe can sell a tire at $40, and Firestone sells one at $120, and they both keep your car in rubber for 40,000 miles, the one with the poor business practices isn't Joe. It is this "all the traffic will bear" attitude on the part of American business that lets the Japanese and others trounce us in our own markets. >Go ahead and concentrate on the under $30 market. That's your prerogative. >There will always be mispriced products, or poor products, or cheap products >or fledgling companies who haven't learned all the hidden costs. But don't >expect, in this instance, for it to make much difference. On a $30.00 >product, the wholesaler only gets $12.00. This has to pay long distance, >rent, salaries, diskettes, labels, manuals, packaging, advertising, upgrades >if there are bug fixes, bad debts, defective merchandise returns, future >r & d and a whooooole lot more. Under normal commercial conditions, $12.00 >doesn't go very far, and it definitely won't cover salaries and office space. > Julie Petersen (LadyHawke) There is no reason for a wholesaler to require more than $2 to pass a product from a producer to a retailer; it is just such obscenities of the distribution system that create the ludicrous prices we are currently paying for our Amiga games. Why does the wholesaler pay for "diskettes, labels, manuals, packaging, advertising"? Those are producer costs. Kent, the man from xanth.