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Heritage pricing?


jimjimbo

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Why are the new Heritage speakers (Khorn, La Scala II, Cornwall III, Heresy III) priced as they are? I don't want to open a can of worms here, and don't want this to be construed as a "complaint" or similar, but.....they just seem high to me, especially the LS at $7K per pair.  I don't know, maybe I'm out of touch with manufacturing costs, labor costs, etc, etc.  Just a question....

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Trey and I had a detailed discussion about this back in 2012 at Indy. Yes, there's some padding there, as is with anything marketable, but as was explained, they aren't priced that much over cost. Good supplies and good people to bring it all together don't come cheap.

 

I've rolled my own horns before too. The cabinetry involves significantly more work. That was clearly evident at the plant, where essentially everything involved has a manufacturing dollar value attached to it.

Edited by Quiet_Hollow
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Your conclusion is not supported by the production levels i witnessed in the plant this last weekend. lots of plywood being cut and plenty of assembled heritage cabinets stacked everywhere

 

 

That is a good sign, yet I wonder how many pair of used Heresy's traded hands today in the world, let alone the rest of the Heritage lineup?

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Why are the new Heritage speakers (Khorn, La Scala II, Cornwall III, Heresy III) priced as they are? I don't want to open a can of worms here, and don't want this to be construed as a "complaint" or similar, but.....they just seem high to me, especially the LS at $7K per pair.  I don't know, maybe I'm out of touch with manufacturing costs, labor costs, etc, etc.  Just a question....

I wouldn't question the price on the La Scala II or the Klipschorn NEARLY as much as the price tag on the Paladiums??? You were THERE, you heard for yourself!

Roger

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At least with speakers as a whole and in our case Heritage in particular one can at least see the components and craftsmanship involved. Materials, skill sets etc. add up quickly in all manufacturing. A new pair of LSll or KHorns at retail seems dirt cheap when compared to the pricing of esoteric cables (wire). Thousands of $$$ for a three foot IC, tens of thousands for ten feet of speaker cable. In the sometimes absurd world of hifi prices - a new pair of KHorns for me please. I can Hear where my money went.

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Factoring for inflation, the prices of new Heritage speakers are way under what they could be.

I think guys forget about inflation when they look back to what they paid new in the 50s-70s.

Conversely, it irritates the piss out of me when a craigslister quotes current msrp to justify their 30 year old beaters astronomical price tag.

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At least with speakers as a whole and in our case Heritage in particular one can at least see the components and craftsmanship involved. Materials, skill sets etc. add up quickly in all manufacturing. A new pair of LSll or KHorns at retail seems dirt cheap when compared to the pricing of esoteric cables (wire). Thousands of $$$ for a three foot IC, tens of thousands for ten feet of speaker cable. In the sometimes absurd world of hifi prices - a new pair of KHorns for me please. I can Hear where my money went.

 

I think they are priced about right.  It takes much more work to build a Khorn than some of the overpriced High End speakers we see in the magazines.  And the Khorns and LS IIs probably have lower FM distortion. 

 

I wouldn't want the prices to go up, though, because I think it is a public service to have Heritage -- especially the fully horn loaded models -- heard in the few houses and stores in which they dwell.  It lets people know what clean, tight speakers sound like.

 

Now what is needed would be some showrooms (like Panasonic has for its projectors) where crowds of tourists, business people, the entertainment industry, etc. can hear Heritage and a few of the iterations of the Jub .... perhaps in New York, San Francisco, La La Land Hollywood, etc.  AR used to have a listening room in Grand Central Station.  How about an inviting back room in the Hard Rock Cafe?

Edited by garyrc
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At least with speakers as a whole and in our case Heritage in particular one can at least see the components and craftsmanship involved. Materials, skill sets etc. add up quickly in all manufacturing. A new pair of LSll or KHorns at retail seems dirt cheap when compared to the pricing of esoteric cables (wire). Thousands of $$$ for a three foot IC, tens of thousands for ten feet of speaker cable. In the sometimes absurd world of hifi prices - a new pair of KHorns for me please. I can Hear where my money went.

 

I think they are priced about right.  It takes much more work to build a Khorn than some of the overpriced High End speakers we see in the magazines.  And the Khorns and LS IIs probably have lower FM distortion. 

 

I wouldn't want the prices to go up, though, because I think it is a public service to have Heritage -- especially the fully horn loaded models -- heard in the few houses and stores in which they dwell.  It lets people know what clean, tight speakers sound like.

 

Now what is needed would be some showrooms (like Panasonic has for its projectors) where crowds of tourists, business people, the entertainment industry, etc. can hear Heritage and a few of the iterations of the Jub .... perhaps in New York, San Francisco, La La Land Hollywood, etc.

 

 

 

 

I tend to agree with garyrc. I can’t speak for Klipsch and it has been a long time since I had been able to see some of the cost structure in any specific situation when I was an auditor and, of course, each company will have some variability in cost structure and buying power in relation to inventory such as drivers, various other parts, wood, veneer, etc.

 

However, what would you consider the “higher-end” speaker market to be in an industry where customers are very fickle and fad-driven to the point where a couple of bad reviews or even an indifferent review can scatter this fickle customer-base out in many directions?   I remember guys questioning their sub-woofer purchase before even receiving it because they read a review on another sub that someone “subjectively” ranked better than the one just purchased.  I'm not sure if there is a better definition of fickle and fad.

 

Let’s throw out the $250,000 and up vanity-speaker projects that various forum members have posted links to now and then, but never amount to any real and sustainable sales volume.  What are we left with, maybe the $5,000 to $40,000 a pair range actually has a sales volume in the higher-end market?   

 

It would seem that most of the Heritage speakers (e.g., Klipschorns, La Scala II, and Cornwall IIIs) fit this “higher-end” range that I’ve defined above, and, of course, the Klipsch Palladiums fit very nicely into this range.

 

Unless you are one of these cottage industry “internet direct” companies, you have to worry about distribution channels, marketing, shipping, storage, inventory, regional sales reps, national sales reps and dealer profits, among a multitude of other aspects.

 

What does a national sales rep or regional sales rep get these days?  Maybe somewhere in the 8% - 12% range?

 

What are the dealer expectations for profit where they will actually have any incentive to stock the speaker and even try to sell the speaker?  It used to be 40% - 50% and I suspect that range hasn’t changed much.  If a dealer can't make money, they are not going to carry the speaker or put much into trying to sell it.

 

Now the manufacturer needs to layer in the potential for high overheads in relation to shipping costs and storage costs and the potential for rapid obsolescence.

 

I believe that the “general rule of thumb” used to be the summation of parts cost plus cabinet plus assembly labor of speaker plus and test labor of speaker for which the sum is multiplied by 5 to determine a customer price in an effort to cover the many charges above that are not so readily apparent.  

 

Note that the rule of thumb apparently doesn’t include how to capture “engineering and development” costs.

Edited by Fjd
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I didn't pay $9,000 for my new 2015 Klipschorns! Find a local dealer that will work with you. Heck, some dealers will give you 15-20% off the Heritage stuff just so they can check it out themselves. My dealer had NEVER seen or heard a pair of Klipschorns. After the shipping company dropped them off everybody came by to check them out! Awesome sound and great build quality! It's no wonder they are expensive!

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Why are the new Heritage speakers (Khorn, La Scala II, Cornwall III, Heresy III) priced as they are? I don't want to open a can of worms here, and don't want this to be construed as a "complaint" or similar, but.....they just seem high to me, especially the LS at $7K per pair.  I don't know, maybe I'm out of touch with manufacturing costs, labor costs, etc, etc.  Just a question....

I wouldn't question the price on the La Scala II or the Klipschorn NEARLY as much as the price tag on the Paladiums??? You were THERE, you heard for yourself!

Roger

 

I know Roger, you are right in what you are inferring, and I know exactly what you mean, but we won't get into that....I don't follow the new lines at all, so I wouldn't even attempt to compare or comment on that.

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Unless you are one of these cottage industry “internet direct” companies, you have to worry about distribution channels, marketing, shipping, storage, inventory, regional sales reps, national sales reps and dealer profits, among a multitude of other aspects.

 

What are the dealer expectations for profit where they will actually have any incentive to stock the speaker and even try to sell the speaker?  It used to be 40% - 50% and I suspect that range hasn’t changed much.  If a dealer can't make money, they are not going to carry the speaker or put much into trying to sell it.

 

Now the manufacturer needs to layer in the potential for high overheads in relation to shipping costs and storage costs and the potential for rapid obsolescence.

 

 

You can't listen to a speaker on the Internet. :)   I would like people to be able to buy speakers the way they used to -- after a few hours of listening, perhaps with a few other customers (or potential customers) present.  Everybody could bring their own music discs.

 

Dealer expectation used to be about 50%, I was told by some dealers.

 

One of the great things about Khorns is that they push into corners, and really don't take up as much space as demo speakers that have to well away from the walls, with wires going to them!  Back when many stores stocked Khorns, their sound could be a standard to aspire to on the part of people who couldn't affford them.  Customers would pick out a speaker that came as close as possible to the clarity and dynamics of the Khorn, then might come back over the years, "trading up" to better and better speakers as they could afford them, ending with purchase of a pair of Khorns.  I was one of them.  My dealer in those days made a point of having other top-of-the-line speakers (like B&W) to compare to Khorns in the same room.  Nowadays, the dealer could "sell up" to the Jubs.

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The markup is very high just like anything else, everyone along the chain has to make their profit.

 

Factor in shipping and dealer profit and still you can usually get 20-25% off retail prices in most cases.

 

I'm sure not all models have the same markup either, i could have picked up the top of the line palladium speakers right down the street just a few years ago at 40% off retail pricing but was not in the market, i just wanted to hear them to see what they were like.

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