Things you did not know about what is inside your speakers and the Huge markups

I own a pair of Sonus Faber Olympica Nova Vs. When I purchased them they were $18K. Since SF makes speakers of all prices, including ones many time the price of the ones I purchased, one can listen to the differences between their sub $10K speakers and their more expensive ones, and judge for yourself. I think there are audible differences, especially in the trebles and mids.

To me the argument about retail being too expensive is fatuous. I spent many years in retail and wholesale distribution. Everything you buy has multiple markups. It is my understanding that audio dealers get about a 30% margin on speakers, meaning for every dollar in retail they make about 30 cents. A normal markup for items in that price range. Also, on brand speakers like Sonus Faber, the distributor sets the price. That's why you don't see deals on new SF speakers or Magico or other good brands.

Before my Sonus Faber speakers, which are all hand made, including the drivers, I owned Golden Ear 2+, thinking I was getting a hell of a deal. To my ear, they sounded much better than their price. In the end, I had several pairs break. Withuot using explitives, whcih Audiogon frowns upon, they were cheaply made. And the minute I auditioned my Sonus Fabers, I realized what a good speaker sounded like. 

When I have gone to shows, I have seen that the good stuff sounded better. If part of what you're paying for is R&D, the manufacturer also has to pay for it. Good audio engineers don't work for minimum wage. 

Audio dealers are constantly going out of business. Do you think that was because they charged too much? I'm sure there are products out there that are too expensive, but for the most part I would say you get what you pay for. If you don't have $!8,000 for speakers (now $22,000 because of tarrifs), Sonus Faber has relatively inexpensive ones, as do many high-end manufacturers. 

The level of markups has been well known for the last 50 years.  What never stops surprising me is how many still happily pay them.  The DIY crowd has long side-stepped this buy building their own loudspeakers and electronics.  Even the good kit systems are a bargain.

The kit amplifiers from VTA perform just fine thank you at a fraction of the price of the big names.  When you find them on the used market, theyʻre insanely cheap compared to new gear that performs no better.

People love to point to the Big Name brands and go on about how their engineers use proprietary magic dust.  You can get equally good engineering from the better kit designs.  The Joseph Audio Perspective 2, which retails for something around $14k or so today, is almost identical to the SEAS Thor kit, designed by Joe DʻAppolito himself, from Madisound at about $2700.  

The Linkwitz Lab designs have long been hi-end audio reference grade.  Even today, you could build the full LX521 system - loudspeaker enclosures, drivers, active crossover, amp channels and cabling, for well under $10,000.   The LX521 compares just fine to loudspeakers in the $50k+ range.  Tack on the major price tag for the amps buyers of the $50k+ systems use and itʻs not hard to drop more than $100k on an amp/loudspeaker combo no better than a DIY LX521.

Iʻm still running my Linkwitz Orions some 20 years now.  Sill love ʻem.  When you see them on the USED market, they can be had for very low prices.

The direct from manufacturer speakers absolutely have the best value. For 3-5 grand you can get a hell of a speaker! My Tekton Nebos were 3k delivered. If you added the parts cost up just in drivers if you were to buy them from Madisound they would be around 2k. Add in a cabinet, crossover, paint, assembly, shipping etc I think you would have a hard time building them for that. 

@russbutton wrote:

The level of markups has been well known for the last 50 years.  What never stops surprising me is how many still happily pay them.

Eventually it calls for the surprise to be turned into deduction and see the money game for what it really is. By now we know the answer to that. 

People love to point to the Big Name brands and go on about how their engineers use proprietary magic dust.  You can get equally good engineering from the better kit designs.  The Joseph Audio Perspective 2, which retails for something around $14k or so today, is almost identical to the SEAS Thor kit, designed by Joe DʻAppolito himself, from Madisound at about $2700.  

You can have actual, high level engineering from the pro sector that doesn't flaunt its pedigree like the high-end domestic industry that's often more about bark and less about bite. What's more pro products of at least comparable quality and of interest to home use are somewhat, not to mention MUCH cheaper than domestic high-end gear (just like DIY kits are), while not cheap per se. Some of them actually are quite pricey, but they also have something to show for it. When you find them 2nd hand however the level of quality that can be had for a relatively modest outlay is staggering. 

The Linkwitz Lab designs have long been hi-end audio reference grade.  Even today, you could build the full LX521 system - loudspeaker enclosures, drivers, active crossover, amp channels and cabling, for well under $10,000.   The LX521 compares just fine to loudspeakers in the $50k+ range.  Tack on the major price tag for the amps buyers of the $50k+ systems use and itʻs not hard to drop more than $100k on an amp/loudspeaker combo no better than a DIY LX521.

That's what a well executed DIY (as well as, to my mind, pro sector) active setup can do, namely save you a lot of money. And yet it's not only about saving money, indeed at the core of things, to me at least, it's not really about that at all; high quality active brings traits to the table that a passively configured high quality setup can't replicate, so it's really about two different types of setups with different gestalts in a sense. Some may say passive also brings traits to the table that active can't approach, but to me that typically comes off more as a "euphonic," blurry/smeared character than a quality per se. 

I own TAD CR1 speakers (at least until they get shipped to their new owner) but the CST driver using vapor deposited beryllium, cost Pioneer millions of dollars to develop.  I doubt they ever got that R&D back.  
 

The driver in my new speaker, the Prodigio Audio WR1 is just a thin sheet of Mylar with some Metallic particles, and wires up the front and rear.  
 

I’m oversimplifying, but looking at the BOM doesn’t tell the story of the cost of creating these speakers. 

https://youtu.be/hRQymIxonAk