XL-H1 Street Price
 

Right now it is selling strictly for $8999.

But 1-2 months from now, what do you reckon the street price of it will settle at? Anyone know the dealer margin on this camera? If it is the same as the XL-2, then I would guess that it will be obtainable for around $7000 or so.

What do you guys think?

What I can tell you is the pitch from the CPS (Canon Professional Services) rep here in Switzerland: with the introduction of the XL H1, Canon is in the process of selecting/building a network of dealers that can truly provide full service for the intended professional clientel of this product. Such a network of professional Canon video dealers is inexistent in many countries, and its building (complete with sales rep and tech support staff training) is costly. As a result, I was told, the XL H1 will sell exclusively through this 'pro'-channel at the official Canon list price.

Whether or not this situation will change in the future, will largely depend on the popularity of the camera. I'm convinced that a fair amount was invested in R&D of this product, and Canon will aim to recover this possibly rather more aggressively than they have done in the past. For comparison, it may be worth while to look at the D-SLR market, where Canon charges a premium for their professional products compared to Nikon. If they can establish themselves in the lower-end pro-video market as a technological trend-setter (for which the XL H1 is a good start), the attractive street prices of past XL-models may very well not be repeating themselves.

I hope not, but that's the pitch I got from Canon here in Switzerland, and I'm quite confident that this is at least the aim of Canon in most European countries.

HTH,

Ron

I paid $4900.00 (exactly) for the Sony Z1U the day it came out in January 2005 from a reputable retailer (EVS).

One year later....

It still sells for $4900.00 (minimum) from all "REPUTABLE" retailers.

So now we have to define the term "Street Price". Because where I come from, that means stolen $4!^ or the ones that fell off the back of the truck and my homeboy Terrance happens to have some in the trunk of his Cadillac. *smile*

Now, if you're considering "Street Price" to be the ones sold on eBay or from these questionable retailers who lie about being authorized, then....well, yea, you can get a new Z1U for $4500 new today. And you better pray you get everything in the box it's supposed to come with.

However for the reputable retailers, the Sony Z1U is still $5000 bucks one year later.

-------------fast forward to the new Canon XL-H1--------------

It sells for $8,999.99. Not one penny less.

So historically speaking, in one year...they will cost the same. But I am sure you'll be able to eBay and grab one for about $8400.00 in a year. And honestly, in 1-2 months from now it will be $8999.99 from the trustworthy retailers, but by then, there will be enough grey market/refurbs out there that these sub-par stores will be passing their units off as FACTORY FRESH for about $8,700.00.

MORAL OF THE STORY.....

Don't buy anything that costs more the the average persons monthly Paycheck from the "Street".

You're better off getting a used one from someone who bought theirs from a reputable retailer like B&H or EVS or Samys, then getting a so-called "FACTORY FRESH" one from a shaddy-tree company that's most likely lying about it it's freshness.

- ShannonRawls.com

Shannon, do you feel adventurous enough to call B&H and telling them that they're a 'questionable retailer'?? They sell the Z1U for USD 4'600 as of this writing...

FWIW,

Ron

There's a difference between "minimum advertised price" (MAP) and actual selling price; Sony has established a MAP of $4900 for the Z1. Dealers are free to sell it for less than that, but they cannot advertise it for less than that or they'll put their relationship with the manufacturer in jeopardy.

However, what Canon is doing with the XLH1 is different. They're requiring their dealers to offer at 100% list price. They're not just restricted to advertise it at that price, but they're required to sell it at that price. So you should not ever see a street price one penny less than $8999.99, unless Canon someday lowers the MSRP, but if they do, all dealers will sell it at that new MSRP and not a penny less.

I'm not 100% sure that's entirely legal, seems that it would impede a free market economy to fix the price at a certain level, but regardless, that is the way it is. Street Price and MSRP are going to be the same thing for the XLH1.

How do you know that is a fact? If a dealer told you, then that is in his interest to tell you such things...

I don't know if Canon can force their dealers to do that.

Regardless I wonder what the dealers pay for it. $6000?

Dealer prices vary with volume. A dealer that sells a high volume of a certain product (or of a defined line of products that will together count towards volume pricing) will pay less than one that sells a handful a year.

And the higher the price of a product, the higher the margin tends to be. But there are exceptions to this rule.

FWIW, the XL 2 has a dealer single-purchase margin of around 27 %, IIRC.

Regarding the XL H1, time will tell, anyhow. High-volume resellers (such as B&H) will start selling a product as low as they can afford to - to beat the competition. If they can get ahold of it in low-price markets overseas, they will start offering the product in an 'import' (aka Grey Market) variety at lower prices than the units purchased through the official distribution channel. But it's definitely too early to tell if that's going to happen with the XL H1. Unless demand is very strong, it probably won't.

I can add some minor background, albeit from the UK. I rang one of the main UK Canon dealers to ask about the XL H1 and I asked specifically about early availability in case demand exceeded supply. They told me not to worry, interest was very low and in fact mine was the first call they'd had, so availability wouldn't be a problem.

If that low level of interest is widespread, then possibly the price may come down sooner rather than later. However the XL H1 is so much more expensive than the FX1 and Z1 that I suspect Canon are quite prepared to take the drop in sales which the high price means.

Canon representatives at DV Expo said that. And every Canon dealer appears to be abiding by it.

Don't start none, won't be none Ron.

You know you read where I said B&H is a reputable company. Stop fadanglin' my words.
Also, it's $4900.00 at B&H bro, not 4600. I ain't talking about negotiating prices with them like you were at a flea market. I'm talking about going to their website, adding it to your cart and going through the checkout....it will be $4900 + tax & shipping. And it's the same way if you go to the store. ONLY IF YOU ASK "CAN I GET A BETTER PRICE?" to the salesman will they MAYBE give you a deal. And that's only if he likes you. To get a better price on the internet, you have to email them, and that number changes day to day depending on who read your email and how they feel that day. And even then, you have to CALL YOUR ORDER IN. So save it.

Everybody wants to start Static with Shan it seems. *smile*

- ShannonRawls.com

www.bhphotovideo.com --> type HVR-Z1U in the search field on the left --> scroll down to the 4900 buck variety --> click on 'Email me a better price' --> enter your email address --> check your inbox --> 4599.95 bucks.

Maybe it's just me...

And there's noone behind the scenes answering these requests. It's automated...

And the usual disclaimer: I'm not affiliated with B&H in any way other than being a happy customer for the last umph 14 years or so...

I'm savin' it. Nitie-nite...

street price defined
 

> So now we have to define the term "Street Price". Because where I come from, that means stolen $4!^ ...

"Street price is the price at which items actually sell in a free market." — Wikipedia.

Best,
Christopher

price fixing
 

>> They're requiring their dealers to offer at 100% list price. They're not just restricted to advertise it at that price, but they're required to sell it at that price.

In the United States and Canada price fixing can be prosecuted as a felony. Under U.S. law, price fixing is illegal if it is intentional and comes about via communication and specific agreement between firms. It is not illegal for a firm to copy the price movements of a de facto market leader (called price leadership). MSRP and MAP are also common practice and legal.

Best,
Christopher

It's only illegal if somebody complains. LOL

I don't think any of the retailers are complaining about selling the XL-H1 for top dollar. Especially if they are held to the MAP.

- ShannonRawls.com

Then I will complain :)

To who though???

A letter to your state attorney general. A google search will give you the address for your state.

Best,
Christopher

Hello, here in Sweden the XL H1 is advertised for SEK 67920, VAT excluded (http://www.scandinavianphoto.se/?31694).
This should cost you about USD 8565 but this is the PAL version. Wow, for the first time we have something here which is cheaper than in the US!!!
Maybe Canon felt to compensate us for the 25 % VAT? Thanks.

I'm not certain that price fixing, as in Canon coercing dealers to sell at a certain price, is any kind of crime. Felonious price fixing would happen if all the dealers got together and, and agreed amongst each other to set the price artificially. But regardless, I am quite sure that canon is NOT requiring dealers to sell the camera at 8999 or any other amount.(*see below)

There are several ways a manufacturer can control the retail price. There is the MAP, described earlier. The most effective way is to simply set the retail price very close to the wholesale price (and then offer sales incentives based on volume). Apple computer does this. Finally, (and this is the Saturn "one price" model) you simply make the dealers few and far between. This has nothing to do creating an expensive "support network", but is simply a method of limiting competition. The more dealers there are, the more likely you will see price cutting. In reality, more and more manufacturers are combining all of these models, and are getting quite good at controlling the range at which their products are sold.

That said, I am quite certain that within a few months, we will see some relieviing of the price pressure on this camera. This same debate raged around the announcement of the xl2, and with the official voices saying the price was set, when in fact the camera was almost immediately available for less, and was commonly discounted within three months.

Regarding the camera only being available through "professional video" dealers, I disagree. This apparently will be true for the HVX200, but my visit to a local retailer last weekend found the H1(actually 3 H1's) sitting next to quite a few amateur canon and sony palmcorders (and there were no Sony DSR-whatevers, or Varicams on the shelf).

Barry

Edit: OK, so while I stick by virtually everything I just said, I do want to say that I just got off the phone with my longtime dealer here in california, and if he was going to discount this camera for anyone, it would be me, as I've spent more than $100k with him over the last few years. He told me flatly that canon is tightly controlling the cost on this camera, and that he cannot sell it for less, "at this point" -- that a few months down the line it may be a different story. He indicated that that they would be in trouble with canon if they sold it for less, which would tell us that canon is in the "process" of setting up this professional pipeline, and they don't want to jeopardize it (this store doesn't have professional video department, only still photo). However, he immediately offered free accessories as a way of discounting the camera, so I guess that is some sort of workaround.

why we pay up for canon products....
 

canon spends about 8% of revenue on R&D. by comparison, major technology innovators such as IBM, sony and xerox spend between 4% and 6%.

canon received 17,000 U.S. patents between 1995 and 2004, second during that period only to IBM.

i don't like what i'm hearing on this board about canon's biz practices, but i guess innovation doesn't come cheap.....

Canon seems to have a world wide policy: It's the same story here. Canon does not let whoever to sell the XL H1, but instead they insist for certain level of professionalism and experience in selling photo equipments from the retailer. At first, I was supposed to get my camera from Germany, but then, they told me, Canon does not allow them to sell the camcorder to another country.

Johan, this was the first time the same camera body can be set to function both in NTSC and PAL mode. Maybe this affected the European list prices.

We have a similar deal here in the San Francisco area to what is happening in Europe. Dealers who sold the XL1 and XL2 have been told that they cannot sell the H1. There is only one authorized H1 dealer and he happens to be the biggest video dealer in the area. He also offers repair service on most of the equipment he sells. My dealer in Modesto (60 miles away) can still sell the XL1 and 2, but believes Canon was trying to get away from the cut throat way the XLs were sold in the past from on-line box shops with no service. When you limit the outlets of your product so severely, it's pretty easy to control prices.

Being from a retail background and having worked in a place that had an 800 number I like to track this stuff... best GUESS and I'll stress guess is that they are at a 25% mark. I just picked up an XL2 and given that I picked up my cam for 3999 and the thing retails for 4999 my logic is right in line with box house 800 number prices of a 5% profit on a box is a great deal.

Here are the numbers that I ran on the XL2

XL2-List 4999
25%-Cost 3749
5%-Profit 3936 round to 3999 and you hit the price point.

XLH1 List 8999
Cost 6750
5 Up on Cost 7086- figure 7099 and you're in business...

I concur with your estimates. ML

Apple has a similar racket... I highly doubt that retailers are making $2K profit off the XLH1 right now.... I will ask around and find the actual price...


ash =o)

Ash we were an Apple VAR and their thing is a little different, they keep a very low mark on their stuff, sometimes as low as 10%, they also treat the major stores different than the VARs.

The biggest issue with them from memory (this has likely changed since 1993) was that as soon as we got our shippment of Macs with a 1299 list, they lowered the price to 999 and we were sitting on inventory that cost more than the current price, then they wouldn't give you a credit or take the stuff back. We dropped them after 2 years, I can only hope they have changed their ways.

They also controlled the prices, very similary to Sony, where they would call your store and see if you would sell for less than list on your 800# and then pull your dealership if they caught you. Things may be a little different now with the eCommerce economy but back then it was hardcore legal actions for box house low profit and move the gear mentalities.

ML

And that is exactly what we used to face in our shop as well, they want a launch with a set price globally, typically it's the box houses that will take the risk and drop the price but only after a mutually respectful time on the market.

That said, look for the biggest house to do it first since the vendor would rather cut their own throats than cut off the supply to their biggest dealer, it's bad business to kill your biggest dealer to try to send a message. That said, here in the US it's gotta be BH so we'll see how long before they plunge the price and others follow.

ml

I just got a quote from one of the few dealers that carry the XL H1 in Switzerland. I get a 5 % break on the cam itself and a 10 % break on accessories. This is from a dealer that usually gives 10-15 % breaks from MSRP. So there are breaks to be had, I guess. Nice to see that!

HTH,

Ron

LATEST UPDATE:-

B&H have it now for $8499. See this link:

http://www.bhphotovideo.com/bnh/cont...goryNavigation

So much for the "fixed" price :)