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Magico Extreme Fidelity

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  #31  
Old 01-16-2013, 03:20 AM
Elberoth Elberoth is offline
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I agree that it is absolutely ridiculous. For the price, you can buy 4 hi-tech, active isolation protforms from Accurion.
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  #32  
Old 01-17-2013, 09:55 AM
jazzman jazzman is offline
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Quote:
Originally Posted by Jérôme W View Post
My remark was just ironic.
Of they think they will sell it.
Mr Lacoste, you defend Magico like a Crocodile

BTW, do you know the price of 250 lbs of copper ? Around 600 euros, let's say 800 dollars.
I still don't see the relation with the price asked and I still think it is absurd to spend 50k in a rack but anyone is free to do whatever he wants with his money....

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do you know the price of the raw material of your pair of Wilson? less than 1000USD.
Sorry, but your comparison is meaningless. I happened to have done acquisition due diligence on different hifi OEMs a few years back, so I know quite well industry cost structure, I can guarantee you that most players in the industry don't make any money.
If you really want to understand where your money goes keep in mind that when you buy a hifi product for 100:
- 50 to 60 goes to the pocket of the distributor
- with the 40 left for manufacturer, 40 to 50%% of the cost goes to payment of overhead: accounting, IT, product design cost, sales cost, management cost... So assuming 10% margin, you have less than 20 left for the COGS (cost of good sold).
Talking about COGS, material cost represents nothing in most hifi products. The rack is mainly aluminium (with some copper). It weighs 500lbs, not 250. Keep in mind that machining something like the M-rack probably takes 4 days to 1 week. Just calculate the depreciation of a 3 axis equipment for one week, and the cost of the machining guy (around 4-5k per month in US). Then you need to do ultra fine polishing- because with anodizing, you need to have a quality of finish at the micron level or you will see imperfections. Then add on the top the cost of finishing itself: anodizing like what Magico is doing costs a fortune because it is a very toxic process, only very few facilities to do that. And at the end you need to ship them... in a wooden crate. You can add 300-400USD extra.

Selling price for the rack may be crazy, but you pay the fact that this thing has been developed to sell maybe 10 of them (even not sure, I also believe they just developed their own rack for their own demo because they couldn't find anything good enough for them, the same way they developed their own music server and are not selling it), that everything is produced in US, that finishing is ultra expensive and that distributors capture more than half of the value. The fact it is super expensive doesn't mean they make really money on it. Unfortunately this is the problem of all audiophile niche products.

Last edited by jazzman; 01-17-2013 at 10:03 AM.
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  #33  
Old 01-17-2013, 01:20 PM
Elberoth Elberoth is offline
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You raised some valid points. However, it is hard to overlook the fact that Magico's own Q3 speaker, which also weights 500lbs (600 lbs shipped), contains two sets of expensive drive units, expensive crossovers, is constructed from much greater amount of parts (which makes it also much more labour intensive to build) and yet - is over 20% less (costs $38,950 USD per pair).

It is really hard not to get the impression, that they charge so much because ... they think can !

Last edited by Elberoth; 01-17-2013 at 04:13 PM.
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  #34  
Old 01-17-2013, 02:19 PM
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Jerome W Jerome W is offline
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Quote:
Originally Posted by jazzman

do you know the price of the raw material of your pair of Wilson? less than 1000USD.
Sorry, but your comparison is meaningless. I happened to have done acquisition due diligence on different hifi OEMs a few years back, so I know quite well industry cost structure, I can guarantee you that most players in the industry don't make any money.
If you really want to understand where your money goes keep in mind that when you buy a hifi product for 100:
- 50 to 60 goes to the pocket of the distributor
- with the 40 left for manufacturer, 40 to 50%% of the cost goes to payment of overhead: accounting, IT, product design cost, sales cost, management cost... So assuming 10% margin, you have less than 20 left for the COGS (cost of good sold).
Talking about COGS, material cost represents nothing in most hifi products. The rack is mainly aluminium (with some copper). It weighs 500lbs, not 250. Keep in mind that machining something like the M-rack probably takes 4 days to 1 week. Just calculate the depreciation of a 3 axis equipment for one week, and the cost of the machining guy (around 4-5k per month in US). Then you need to do ultra fine polishing- because with anodizing, you need to have a quality of finish at the micron level or you will see imperfections. Then add on the top the cost of finishing itself: anodizing like what Magico is doing costs a fortune because it is a very toxic process, only very few facilities to do that. And at the end you need to ship them... in a wooden crate. You can add 300-400USD extra.

Selling price for the rack may be crazy, but you pay the fact that this thing has been developed to sell maybe 10 of them (even not sure, I also believe they just developed their own rack for their own demo because they couldn't find anything good enough for them, the same way they developed their own music server and are not selling it), that everything is produced in US, that finishing is ultra expensive and that distributors capture more than half of the value. The fact it is super expensive doesn't mean they make really money on it. Unfortunately this is the problem of all audiophile niche products.
I did not raise the point of the weight of copper relative to price. Lacoste did.
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  #35  
Old 01-17-2013, 05:09 PM
takahwon takahwon is offline
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Quote:
Originally Posted by jazzman View Post
... So assuming 10% margin, you have less than 20 left for the COGS (cost of good sold).....
Talking about COGS, material cost represents nothing in most hifi products..... The fact it is super expensive doesn't mean they make really money on it. Unfortunately this is the problem of all audiophile niche products.
I now nearly feel guilty haggling about price with my audio dealer!!!
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  #36  
Old 01-17-2013, 06:53 PM
jazzman jazzman is offline
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Quote:
Originally Posted by Elberoth View Post
You raised some valid points. However, it is hard to overlook the fact that Magico's own Q3 speaker, which also weights 500lbs (600 lbs shipped), contains two sets of expensive drive units, expensive crossovers, is constructed from much greater amount of parts (which makes it also much more labour intensive to build) and yet - is over 20% less (costs $38,950 USD per pair).

It is really hard not to get the impression, that they charge so much because ... they think can !
Good point. Keep in mind the impact of volume effect: they will sell much more Q3 than M-rack, so productivity increases, share of fixed cost decreases, etc. Margin given to distributors also change by category: a dealer will make for example more money on accessories like cables than on speakers. Don't know about racks.
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  #37  
Old 01-17-2013, 06:54 PM
jazzman jazzman is offline
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Quote:
Originally Posted by takahwan View Post
I now nearly feel guilty haggling about price with my audio dealer!!!
all the opposite... dealers are the one making the larger margin... at least the one who are successful and are selling ;-)
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  #38  
Old 09-09-2015, 03:06 AM
beat5 beat5 is offline
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Quote:
Originally Posted by Masterlu View Post
HRS MXR... The Best I have found, and less money too!

ivan does this rack come in a wide body version - where you can sit two units side by side?
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  #39  
Old 09-23-2015, 04:58 PM
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Quote:
Originally Posted by cmalak View Post
I saw this in Stereophile's CES coverage. It's absolutely ridiculous There is the high-end and then there is the stupid-end. I think this clearly wades in the latter.
+1
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  #40  
Old 09-23-2015, 07:06 PM
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Quote:
Originally Posted by beat5 View Post
ivan does this rack come in a wide body version - where you can sit two units side by side?
Yup, better bring both wallets too!
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