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Old April 24th, 2010, 11:54 AM   #1
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The cost of video equipment

This is a bit of a rant i guess but can anyone justfiy the prices that some companies charge for video gear ? Im just in the hobbysit category for the most part so i am really shocked at how much some things are priced at..

Ive worked in retail in the past and seen the markups on various products in different categories and know how much money some companies make it gross profit terms and ever since its made me alert to such things.. I have to say that after looking at various gear in "pro video" category i think a lot of it is pure highway robbery.. It makes me ponder the term rip off and what it means and when it becomes valid..

For example... B. Hague & Co. Ltd Tracking Systems

That might do an ok job but at 1800 pounds it would want to.. The materials in that would cost all of about 200-300 pounds to make.. I cant swallow the idea that the rest of that markup is to repay R&D or there are channel cost which bring it anywhere beyond 500 pounds or so.. Which would suggest the markup is very large.. I think cameras for the most part seem to be ok value when you consider all the components and work in making them, but stuff like this dolly system and most camera support gear is way over the top.
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Old April 24th, 2010, 07:48 PM   #2
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The industry needs more quality gear at cheaper prices. If you feel that you could make a comparable product, market it worldwide, guarantee it like this company does, and do it for 1/3 the cost, PLEASE make it. And many people will buy it.

I'm sure this company looked at the dolly track systems for ten thousand pounds and though they could do it better for less money. And did. Clearly this company sells enough units at the current cost to justify making them. I can't fault them for that.

But if you can do it better and cheaper...
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Old April 24th, 2010, 08:21 PM   #3
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You're right, Randy, but the prices are high because people are willing to pay that price. I've tried to DIY a couple of projects and in both instances my results were far inferior to what a commercially-produced product looks like even though I started with similar or the same materials.

And some of the mark up goes to justify the "professional look." I made a dolly. It works. It also looks like I pulled the parts out of the rubbish and people snicker when I turn up with it. When I turn up with a commercially-made piece of grip, on the other hand, people are impressed. That's part of the price difference.

I think everything is marked up! I cannot believe that a 16gig CF card costs more than $15 to produce.
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Old April 24th, 2010, 08:46 PM   #4
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Back in the 1980's when I worked at Motorola in Austin, Texas, the word was take the price of raw materials, triple it, and that's what you had to charge to pay for materials, the employees, the building & plant, all the insurances, and the taxes, social, medical, personal income, business property, business income. It all adds up, and in a great big hurry.

And the group I was in was a relatively low volume, high end commercial customer sort of operation, similar to a lot of camera equiptment manufacturers. There just wasn't / isn't a ton of volume to spread the overhead over.

In Australia you have to add VAT to that, don't you Randy? Another 20%...

Bob, have you checked out what a modern semiconductor plant costs to build & furbish?
Bring boat loads of money is all I can say... ;-)
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Old April 24th, 2010, 08:56 PM   #5
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The item you highlighted is manufactured by Libec, not B. Hague, is bought by B. Hague at a trade price (whatever that is) and has a margin added on to cover that companies costs and make a small profit.

At the price point it occupies it is at the top of the semi pro market and bottom of the pro market (very bottom, actually).

The price also includes 17.5% tax which is beyond the control of anyone involved.

You have already identified yourself as "just in the hobbyist category" which puts this unit way beyond what you either require or could want.

Much of the non electronic paraphenalia involved in video is, to all intents and purposes, hand made, because the small number of units actually sold in any one year do not warrant the cost of a production line.

Throw in "you get what you pay for" and the more pricey materials and processes required to manufacture a unit push costs through the roof.

How about this:

B. Hague & Co. Ltd Tracking Systems

This is aimed at the serious hobbyist/ semi pro and works exceedingly well, I know, I happen to have one.

I also happen to have a considerable amount of other B. Hague equipment, all of which is well made, solid, reliable and very modestly priced for the performance delivered.

If you feel the price shown for the hand made unit I have highlighted is "a rip off" you would be well advised to heed Perrones' advice and start knocking them out yourself.


CS

PS:

To provide further proof that B. Hague isn't ripping anybody off, here is the the same unit you highlighted (unfortunately tagged to B. Hague) on the Libec USA web site:

Libec-Tracking Rail systems

The indicated US price of $2640.00 is, at todays exchange rate, GBP 1716.85. On top of that needs to be added shipping, import duty and VAT @ 17.5%. The price indicated by B. Hague of GBP 1789.95 would appear very reasonable indeed.

Last edited by Pete Bauer; April 24th, 2010 at 11:14 PM.
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Old April 24th, 2010, 11:58 PM   #6
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Any professional equipment for any industry will seem like it is overpriced to those who do not make money with it. Once you start having to rely on the quality and durability of equipment you use everyday, you will understand why some things cost as much as they do. Sure, you could go out find or make something for a fraction of the cost, but it will end up costing you much more if you have to use it repeatedly and rely on it for income.

A good example are tools. Why are professional carpenters willing to pay $700 for a miter saw when they could by one for $90. Because it will last and it will give more precision. Does the DIY'er need a $700 saw, no but in the long run the extra money spent by the professional will save him money. The same holds for the hobbyist vs. professional in videography.

BTW, I've been looking into DIY dollies. The most expensive part seems to be getting a good set of wheels and bearings. And the size makes most design I've seen difficult for transport to locations.

Chris, I have a question about the dolly you noted but I don't want to hijack this thread. Could you see my other post here:

Inexpensive track dolly

Thanks,
-Garrett
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Old April 25th, 2010, 01:04 AM   #7
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That Libec dolly system was my example but there are many others.. I went to the Libec site and saw they charge almost $1000 USD for about 1 meter of curved tracking for that same system.. We are talking about some aluminium tracks.. I just find it ridiculous..

i understand the lower volumes versus cost factors in and also the materials, r&d and other components are going to add up. i just still cannot fathom that even after all those things the prices can be justifiably so high..

A good reference to this would be an audio company behringer.. For years and years before behringer came along audio gear was fairly expensive (still not half as bad as video gear though) but then suddenly behringer came along and proved you could still make similar items and sell them for a fraction of the cost and over the course of the last 15 years they have changed the entire landscape.. Now other companies are forced to be more cometitive because of them and you have got a market with real competition and has regulated itself because of that..

So part of me wonders if theres an abscence of a company taking that mindset and business model with video gear to help regulate things. All things considered it just doesnt add up to me when i see some of these prices..

That Libec dolly is in more of a "prosumer" category.. But the funny thing is so many people expect a prosumer videographer to work for nix.. How often do you see on sites like craigslist people listing a "gig" as being without pay. Its expensive if you arent making money back from it but then again i wonder about the rate of return for most people on these things, especially considering you need another 15k worth of gear to complete your kit.

The other thing in all this is, Im sure the chinese workers that make most of this gear are probably getting paid minimum wages.. I hate capitalism and greed though which forms a percentage of where im coming from by mentioning this.
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Old April 25th, 2010, 01:53 AM   #8
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Hey Randy,

With Chinese labor in mind, if you think the mark up on video gear seems crazy, you wouldn't want to know how much in materials and labor those pants and shirt you have on cost. My brother use to work for Levi's and it blew me away how much the total mark up was once it got into the consumers' hands.

As far as filling in a cost niche market, there are several makers of "inexpensive" video gear. The most saturated is probably in the lighting arena. Many cheap knock offs come out of China but as most eventually learn, you do get what you pay for. As for mechanical devices such as dollies, tripods, jibs, to make a good product takes a lot of good design and manufacturing at some pretty tight tolerances. In order to do that takes skilled labor and specialized machines. A metal lathe alone costs about $5000.

Video gear is in a very strange period. There are tons of hobbyists who want to produce something like what they see coming out of established production houses and wonder why they can't. In a lot of cases it's a combination of talent and not having the right tools. Most hobbyists wouldn't even consider using a dolly; and remember, if you are on this forum and are a hobbyist, I don't think you can consider yourself the average hobbyist. The average hobbyist picks up a camera and maybe a $150 tripod and just wants to shoot. You are really talking about specialized tools that won't be used very often. I am considering purchasing a dolly because I can see a need to us one in maybe 5% of the shots I will be doing. Considering the number of shots I might have to do in a movie, it makes it worth it for me to buy one rather than have to rent one each time I need it. So, overall a manufacturer won't really sell to many of these devices. Hence, the cost per unit has to be high enough to keep them in business.

Would I like to pay less for my gear. Of course. do I think it's overpriced? You bet, every time I have to purchase something. But as I mentioned, there are already several companies trying to make equipment that can sell for less. Have they been successful? to a certain degree some have and some haven't. If you can produce this stuff for less I'd say go for it. Every time I try to make something instead of purchasing it I end up spending a lot of time and while I may save a little on the cost of materials I end up spending way more in time. I just like to make things so there is a payoff in that.

If you do decide to try to make one or find a better value please let us know. Like I said, I'd love to pay less for something that will do an equivalent job.

That's just my opinion which quite often can't be considered entirely sane.

Good luck,
Garrett
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Old April 25th, 2010, 02:06 AM   #9
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Randy................

I don't know what experience you have in the (video) business in Oz, but I'd say, given what you've written, not a great deal, please correct me if I'm wrong.

There are any number of pro video companies working in Oz and I can assure you, they don't work for nix (nor anything like it), nor are their equipment purchases dictated by "how cheap can we get it".

They are companies that cover their equipment costs through cash flow and tax depreciation/ writedowns, as all companies fund any equipment purchase.

As a "prosumer" you are stuck between a rock and a hard place - you can't write off equipment purchases against tax and you're still having to pay GST AND you have to fund that purchase with money that has already been taxed as income AND.......well, you can see where this is going.

Video is bloody expensive, it's as simple as that, no ifs, buts or maybe's.

If you can't find or build a business model that can fund this business, don't do it as a business and do it as a prosumer. You won't make much (if any) money, but you may just enjoy it.

If you don't (enjoy it) then take up another hobby.

Finally, turning up for a paid job with gear that looks like it would be better off at "Amateur Night at The London Palladium" is a dead cert business killer (think someone else may have said that already) so don't oversell yourself if you can't pay for the price of admission to the pro or semi pro club.

Sorry mate, there's no "get out of jail free" card going on this, you can either stump up the cash for gear and shoot damn good, or you can't.

If it's the latter, you're stuffed, quite frankly, end of story (as a business, I hasten to add).

Sorry if this sounds terribly depressing, it's meant to be a realistic evaluation of the industry as a whole, not just where you are or you personally.

I do know that here, some of the pro outfits are running fit to bust and others are seriously eyeing that brick wall they're rapidly heading towards - head first.

Just accept that good gear costs, end of another story, it isn't going to change any time soon.


CS
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Old April 25th, 2010, 03:58 AM   #10
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You can save some money by having kit manufactured as a one off, I did this with the Garfield mount that I had made for hard mounting my Steadicam. However, it wasn't cheap either and from memory it cost more than the cost of the tracking system mentioned and that was 20 years ago.

Specialist dealers tend to higher mark ups than the local supermarket. That's not unique to film & video equipment, it applies to many types of product.

On the Levi jeans front you can buy 501s online from Macys in the US at $34.99 (regular price $48), jean shops in UK charge 70 for the same item.

If you're prepared to act as your own middle man, you can make savings, but sometimes you also must accept some the risks involved as well.
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Old April 25th, 2010, 04:25 AM   #11
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Quote:
Originally Posted by Chris Soucy View Post
I don't know what experience you have in the (video) business in Oz, but I'd say, given what you've written, not a great deal, please correct me if I'm wrong.
No not a great deal, as i said im a hobbyist with video and thats all i want to be, i make money as an audio engineer.

Quote:
Originally Posted by Chris Soucy View Post
There are any number of pro video companies working in Oz and I can assure you, they don't work for nix (nor anything like it), nor are their equipment purchases dictated by "how cheap can we get it".
I realise there are pro companies that dont work for nix. That wasnt the point i was making.. I was saying things like the libec dolly is considered prosumer grade and its price tag is high for what it is, which is essentially not much in terms of engineering or materials.. The prosumer category of videographers often dont make much money also.. So the nucleus of my point is about high price tags and return of investment for the demographic likely to buy them. In this case the prosumers not the real pros.

If that Dolly system was 800-1000 pounds you would say its expensive for what the components are but i personally could accept it as not being overpriced.. When you are talking almost 2000 pounds it the size of the figure that makes alarm bells ring with me.


Quote:
Originally Posted by Chris Soucy View Post
Video is bloody expensive, it's as simple as that, no ifs, buts or maybe's.
Sorry but that statement is just fluff.. The point i make is the materials, manufacturing and channel costs in delivery, versus the user base and the income potential in the prosumer category.. The proportions are way off.. A lot of the gear is way overpriced for what it is (especially the mounting side) and the income potential in the mid range category is fairly average..

I believe its possibly because no one in the market place has taken an aggressive attutude like the example i made with behringer. Im not excluding pressures that go into business entirely, what i am saying is the size of the price tags for the items and what you actually get is disproportional.


Quote:
Originally Posted by Chris Soucy View Post
If you can't find or build a business model that can fund this business, don't do it as a business and do it as a prosumer. You won't make much (if any) money, but you may just enjoy it.

If you don't (enjoy it) then take up another hobby.
Im aware of my options and really your advice is misdirected.. I didnt need a lecture on how i can try and make money from this, its got nothing to do with why i raised the topic..



Quote:
Originally Posted by Chris Soucy View Post
Finally, turning up for a paid job with gear that looks like it would be better off at "Amateur Night at The London Palladium" is a dead cert business killer (think someone else may have said that already) so don't oversell yourself if you can't pay for the price of admission to the pro or semi pro club.

Sorry mate, there's no "get out of jail free" card going on this, you can either stump up the cash for gear and shoot damn good, or you can't.
Again the topic i raised is not about me trying to make money.. It was about market observation.

But in response to the concept of brands and trying to look good.. Ive found most prosumers who put too much creedence into having the best brands are often overcompensating for crap skills.. Thats a very broad generalisation and im certainly not convicting everyone in that, but i see so many people in audio who talk about how they are held back because they cant mix on an SSL or they dont have some amazing list of outboard gear but the fact is their gear is capable of much better than what they actually turn out. Ive heard guys mix stuff ITB which sounds amazing on a few plugins and the right ability..

Also i know a guy who almost mortgaged his house to buy a REDD camera because he had dreams of making movies.. Yet his stuff looks like garbage. But according to him anyone with a Z1 or similar is an amateur.. Its a messed up proposition and that mindset is probably what allows companies to overcharge for things.


Quote:
Originally Posted by Chris Soucy View Post
Just accept that good gear costs, end of another story, it isn't going to change any time soon.
End of another story ? Maybe in your eyes.

Fact is i wont be accepting that proposition anytime soon sorry.. A statement like that allows for far too much "creative license" in terms of pricing. Personally i dont believe their is enough compeition in video gear or at least the right type of company doing business and thats probably where the problem lies for the "prosumer" category at least.

The high end stuff which is going to make good income has probably got better return on investment percentages and can be justified.. Even the prosumer cameras like Sony and Canon HDV stuff is fairly well priced for what it is i think.. Im talking about things like a few bit of alluminum from libec costing $960USD being the problem.

Libec-Tracking Rail systems
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Old April 25th, 2010, 05:13 AM   #12
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Quote:
Originally Posted by Garrett Low View Post
Hey Randy,

With Chinese labor in mind, if you think the mark up on video gear seems crazy, you wouldn't want to know how much in materials and labor those pants and shirt you have on cost. My brother use to work for Levi's and it blew me away how much the total mark up was once it got into the consumers' hands.
Yes thats when i wonder if our capitalism ideologies have gone too far

Quote:
Originally Posted by Garrett Low View Post
As far as filling in a cost niche market, there are several makers of "inexpensive" video gear. The most saturated is probably in the lighting arena. Many cheap knock offs come out of China but as most eventually learn, you do get what you pay for. As for mechanical devices such as dollies, tripods, jibs, to make a good product takes a lot of good design and manufacturing at some pretty tight tolerances. In order to do that takes skilled labor and specialized machines. A metal lathe alone costs about $5000.
I am willing to accept that to a degree, though I have seen examples in other categories where im not sure paying more always means better quality. If you are talking about the worst brand versus the best brand it obvious you will notice better quality but in the middle it gets a bit grey.

Also these days lots of things are OEM and rebadged or often times manufacturers claim something will last longer but still arent willing to offer longer warranties.. I would be interested to know the real figures on some of this..

Quote:
Originally Posted by Garrett Low View Post
Video gear is in a very strange period. There are tons of hobbyists who want to produce something like what they see coming out of established production houses and wonder why they can't. In a lot of cases it's a combination of talent and not having the right tools. Most hobbyists wouldn't even consider using a dolly; and remember, if you are on this forum and are a hobbyist, I don't think you can consider yourself the average hobbyist. The average hobbyist picks up a camera and maybe a $150 tripod and just wants to shoot. You are really talking about specialized tools that won't be used very often. I am considering purchasing a dolly because I can see a need to us one in maybe 5% of the shots I will be doing. Considering the number of shots I might have to do in a movie, it makes it worth it for me to buy one rather than have to rent one each time I need it. So, overall a manufacturer won't really sell to many of these devices. Hence, the cost per unit has to be high enough to keep them in business.
The last portion of what you say is fair enough, i know you need higher returns if you have lower turn over.. Im just very skeptical about the size of the price tags.. As i say its hard to know exactly but my gut feeling says things like that dolly example would be making a very solid return at 800 pounds let alone 1800.



Quote:
Originally Posted by Garrett Low View Post
Would I like to pay less for my gear. Of course. do I think it's overpriced? You bet, every time I have to purchase something. But as I mentioned, there are already several companies trying to make equipment that can sell for less. Have they been successful? to a certain degree some have and some haven't. If you can produce this stuff for less I'd say go for it. Every time I try to make something instead of purchasing it I end up spending a lot of time and while I may save a little on the cost of materials I end up spending way more in time. I just like to make things so there is a payoff in that.
I would like to see a startup with solid parent company come into the video field with a low cost higher turn over philosophy, if not to buy their products but to keep the market moderated. Thats the fundamental part of my point, it looks fairly unmoderated to me at the moment.. A few smaller companies are there but maybe without much cash flow or backing.. Its just something to think about, to be honest i dont want to argue with anyone over it.


Quote:
Originally Posted by Garrett Low View Post
If you do decide to try to make one or find a better value please let us know. Like I said, I'd love to pay less for something that will do an equivalent job.

That's just my opinion which quite often can't be considered entirely sane.

Good luck,
Garrett
Ironically i wasnt actually looking to buy a dolly, i was just browsing through to see what things are out there and how much they are.. The only thing im looking at buying anytime soon is a motorised head and then im possibly going to build myself a joystick controller with a LANC interface to control it while also manning an audio position at live gigs.
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