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Elecraft's Business Model

Posted by Jim Brown-10 on Feb 25, 2012; 10:24pm
URL: http://elecraft.85.s1.nabble.com/Key-Down-Amps-tp7316632p7318243.html

On 2/25/2012 1:04 PM, Oliver Dröse wrote:
> But what do monitors/displays have to do with amateur radios/transceivers?

The key here is that products that are high volume items that can be
sold to a very large market are CHEAP because they are built and sold in
very high quantities.  This means that design, manufacturing, sales, and
support costs can be spread over hundreds of thousands of pieces rather
than the 5,000 or so that is typical of a popular ham radio rig.   It is
also true that mass market products are sold with very low mark-ups over
their cost.

For these reasons alone, it is pointless for Elecraft to manufacture or
market anything  in product categories for which high quality products
can be bought in the mass market.  This includes products like
microphones, headsets, computer monitors, and so on. We can buy CM500
headsets for $40-$50 -- Elecraft would have to add $20 or so to that
cost to sell it to us, and they still wouldn't be making money on it.

It also does not make sense for Elecraft to build products in categories
that are well covered by other high quality manufacturers.  One big
reason that there IS a KPA500 is that Alpha does not sell a 500W amp.
Another is most  other 500W amps aren't great. And Elecraft is building
the KAT500 because other options in that product category either aren't
so great or that the KAT500 can provide much better integration with the
KPA500.

73, Jim K9YC
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