If I pay 499$ for a ------

[stan 58]

If I pay 499$ for a epi les paul from say Musicians Friend, how much do you think they pay for that same guitar?Stan.

[matiac]

I bet right around half...

[Billybob Dylan]

I bet right around half...

At the most.

 

And I'd be surprised if it costs Epiphone much more than around $50 to make.

[JefferySmith]

I think a 100% markup is common in the jewelry business, but not so common in this area. I think that it is probably closer to 30%.

[layboomo]

40% is pretty widely accepted as "industry standard"

[RotcanX]

Yup. 40-45% is standard on medium-ticket items. More on the little stuff. We'll go less on a big item like a Gibson.

[jfalkens]

If this item : Gibson SLASH Les Paul is $4400!!!!!! How much do you think SLASH gets per guitar?

 

 

Slash Guitar at Musicians Friend

 

I say he would get $1000 for the Gibson one and probably $250 for the Epiphone one.

 

Just My guess.

[Ricochet]

 

I say he would get $1000 for the Gibson one and probably $250 for the Epiphone one.

 

 

Too generous' date=' it's more like 10-15% of the [i']production cost[/i] for every guitar sold.

[jfalkens]

 

Too generous' date=' it's more like 10-15% of the [i']production cost[/i] for every guitar sold.

 

I would agree, but for pete's sake, it is a Les Paul with the crummy vinatage sunburst, not even the nice spray, but the crummy teardrop that epi uses on most guitars now. Is it really worth $4400 Clearance price??? LOL. I could see that if it was about $2500, but I think for what they charge for it, he has to be getting more.

[Biff]

If this item : Gibson SLASH Les Paul is $4400!!!!!! How much do you think SLASH gets per guitar?

 

I say he would get $1000 for the Gibson one and probably $250 for the Epiphone one.

 

IMO very unlikely. The royalties would be much less than the dealer's share and he probably got a flat fee deal anyway.

[Sheik Yerbouti]

Honestly, 'big ticket' items like guitars and such have minimal markup compared to cables, strings, etc. I used to sell mountain bikes and the markup was very minimal. We made up for it with component prices, clothing etc. I really doubt it's more than 20 - 30%.

Just guessing, but going on a similar pricing scale (entry level mountain bike = 250/300 bux entry level guitar 250/300 bux) not talking about walmart bikes here, but specialized, trek, cannondale, etc. Same things could be probably said for Fender, Gibson, Epiphone, etc.

[stan 58]

I don't know but the big guys buy these guitars buy the shipping container, I can't believe they pay more then 200 bucks for a les paul. Stan.

[ricach]

Most of us know this already, but in an interview with Slash in GuitarPlayer he said

 

"The Epiphone Signature model is more affordable than the Gibson USA model, but it actually has a lot of the same exact gear on it."

 

Wonder if Gibson was very happy with that comment?

[RotcanX]

Back on the original forum there was a heated debate as to whether or not Epi's 'Korina' guitars were actually made of solid Korina. One of the clinchers to the argument was the calculation that in order to get the guitar to the consumer at $600, and figuring in all the markups along the way, the cost of manufacturing for one of these - including raw materials, hardware, plus labour and overhead - had to be on the order of $100 max. That would be the cost to Saein or Unsung, say. Of course that's just a guess, and it's probably on the high side, but I figure it's in the ballpark.

 

Oh and remember that a store's 40% markup only represents the gross profit; once you figure in all the overheads, the actual net profit is going to be less than that.

[stan 58]

I know we've been over this before, but I remember the story as the guitars put together with smaller pieces of 'korina' and then covered with veneer for looks. Spud, I know you disagree with this but I still hope its true and that epiphone is not lying to us.Stan.

[The_Buffalo]

Don't know how true it is, but I've heard that besides paying low wages, these factories are subsidized by the Chinese government - you couldn't match their price & quality here in Canada or the U.S. even if you used slave labour.

[RotcanX]

I know we've been over this before' date=' but I remember the story as the guitars put together with smaller pieces of 'korina' and then covered with veneer for looks. Spud, I know you disagree with this but I still hope its true and that epiphone is not lying to us.Stan.[/quote']

 

They're not lying to you, Stan. They never say that these guitars are 'solid' Korina. Phillipine mahogany with a veneer of Korina can be called 'Korina', just as a dining room table made out of particle board with a walnut veneer can be called 'walnut'. As long as they don't use the word 'solid', it's acceptable. And since they don't use the word 'solid', well, you can draw your own conclusions.

[stan 58]

Made from real korina for light weight feel and tone. Body material- korina. Thats what is says on the epi web page. Now you may be right but if the body is not made of korina, to me thats a lie. Stan.

[tulsaslim]

I heard this many years ago so things might've changed but in days of old it was said the 'list price' of a guitar was approx 250% of the cost of manufacture.

[RotcanX]

Made from real korina for light weight feel and tone. Body material- korina. Thats what is says on the epi web page. Now you may be right but if the body is not made of korina' date=' to me thats a lie. Stan.[/quote']

 

I hear you, and I agree with you. I think there should be more disclosure as to what they really mean. However you have to admit that 'Philippine mahogany body with maple veneer over Philippine mahogany cap' sounds a lot less appetizing than 'Mahogany body with maple cap'. But heck, what are you going to do? Welcome to the wonderful world of marketing hype.

[RotcanX]

I heard this many years ago so things might've changed but in days of old it was said the 'list price' of a guitar was approx 250% of the cost of manufacture.

That was most likely true for the US manufacturers such as Gibson' date=' Fender, Martin etc... but with regard to the Asian-made stuff I think you're looking at a [i']much[/i] larger figure, at least 600%.

[Manimal]

 

I hear you' date=' and I agree with you. I think there should be more disclosure as to what they [i']really[/i] mean. However you have to admit that 'Philippine mahogany body with maple veneer over Philippine mahogany cap' sounds a lot less appetizing than 'Mahogany body with maple cap'. But heck, what are you going to do? Welcome to the wonderful world of marketing hype.

EXACTLY!!!!!!!!!

[Manimal]

That was most likely true for the US manufacturers such as Gibson' date=' Fender, Martin etc... but with regard to the Asian-made stuff I think you're looking at a [i']much[/i] larger figure, at least 600%.

 

Now, these markup assumptions are based on MSRP? or street price? I just bought a Seventies Vintage Modified Squier P Bass which set-up is pretty decent for only $249. I ordered it first from an online source which said that they had it in stock. Well I get notified a few days later on the phone that they were actually out of stock. They were willing to give me further discounts on in-stock bass's, none that I was really interested in for the price. The rep said that they only had about a 12% mark up on Fender and Squier stuff. Makes you wonder. I sold cars for a while in the past, and believe it or not, a car that costs $16,000 MSRP has only about a $700 mark up from invoice, and about $375 in dealer hold-back under the actual invoice. Pretty sad.

[Dave]

Before the internet, band members and other regular customers could count on a 30% discount on anything in the store. Once Musicians Friend and other internet dealers came into the picture, music dealers would sell the instrument based on the internet ad price plus the shipping costs from the online dealer. The online dealers started giving free shipping deals to get back the business that was going to the music stores. Now, you can pretty much count on the local dealer matching the internet price.

 

I like dealing with mom and pop stores where I can. If I can't get it from the mom and pop store, I drive to GC. There have been times when our band suddenly needed sound equipment rentals and had to get the owner to meet us after hours to rent equipment to us (when there was supposed to be a house system that didnt materialize), or an amp failure. It's nice to have someone who will go back to the store and accomodate you. GC won't do this and you can forget about online dealers in those cases. We try to buy locally when we can for this reason.

[TWANG]

You can spend all day trying to find out how much profit somene makes.

but without talking about overhead, it's pointless.

 

in addition to the guitar, you have to have a store, heat, air conditioning, furniture,

and that's not mentioning all the business end of stuff you have to buy.

 

In the end, there's no real way to figure out what something costs to build and compare it to what you pay unless you take into account

everything it takes to sell more than one.

 

the reason stores don't offer much discount on small items is because you have to invest, have a stock and sit on it.

 

The market decides in the end. and we are paying fair prices across the board.

my god, I've never seen so many really nice low end guitars in my life.

and I've never seen so many pro quality instruments in the median range.

And that's just epis!

 

I don't know of a single busines which would really discount a product based on manu. costs alone.

It would be insane to do that.

So you cant expect to barter about it.. you'll get a low enough price to sustain the business, because that's the way it has to be.

 

Back in the day we used to get 30% off list price at the stores I visited.

Dealers typically buy at 50% off list as a general rule.. plus shipping. and some things closer to 40% or 45% off list.

guitars probably are less than 50% off to them.

again. then you ship it. you have to work to unpack it, keep it displayed, and all of that adds to the cost.

 

I used to laugh at people who complained about 1.25 drinks at the bar I worked at..

why they're .75 across the street.. says mr. drunky.

 

yeah. across the street is a hole in wall with four tables and a plywood bar.

here is a building three times that size, with modern everything bands and dancing girls.

the air conditioning alone on a big place would probably justify the cost increase.