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Your expensive guitar and its actual low value

Discussion in 'Sidewinders Bar & Grille' started by axis69, Mar 8, 2018.

  1. johnnymg

    johnnymg Senior Stratmaster Strat-Talk Supporter

    Sep 5, 2015
    Central Coast Ca
    "He said they made their money on lower end Fenders, not the handful of CS models they sell each year"

    Wow, ain't that an eye opener.
     
    Last edited: Mar 8, 2018
    Paperback Rocker likes this.

  2. Percy

    Percy Most Honored Senior Member Strat-Talk Supporter

    My 1991 Fender '62 AVRI sold for just over 1k USD's in '91.....

    It is worth 1200 or 1300 American now....maybe....
     

  3. Stratoskater

    Stratoskater Senior Stratmaster

    Age:
    42
    Feb 8, 2011
    Raleigh NC
    Depends on what goes into that guitar. Nitro is more costly to spray, two piece bodies cost more than 4-6 piece ones because you get less bodies from the wood and you have to have pieces that match up better. Pearloid dots cost more than plastic, mia comes with case, MIM a gig bag. AVRI, Sig models and CS have more work done to “finish” them. Buy yes as mentioned before Fender makes more profit on their lower priced guitars than the high end.
     

  4. abnormaltoy

    abnormaltoy BushBaby Strat-Talk Supporter

    Apr 28, 2013
    Tucson

    Something can cost very little and yet be priceless.
     
    henderman, Rudi and Bob the builder like this.

  5. CalicoSkies

    CalicoSkies Senior Stratmaster

    Jun 10, 2013
    Hillsboro, OR, USA
    So now that Fender sells guitars directly to consumers, why are their prices the same as a retailer? For instance, both Fender and Guitar Center sell the American Special Stratocaster for $999.99.

    Yeah, I would imagine consumers have driven prices down about as low as they can go, although I imagine there's definitely still some wiggle room.
     

  6. vid1900

    vid1900 Senior Stratmaster

    Nov 25, 2016
    USA
    That's for sure.

    Just un-sticking those Fender Nitro necks from everything they touch in the factory probably doubles the handling costs right there.
     
    Stratoskater likes this.

  7. Ebidis

    Ebidis Providing the world with flat bends since 1985 Strat-Talk Supporter

    Age:
    51
    Nov 14, 2013
    Alabama
    There are probably contractual, or at least company policy, requirements that Fender does not undercut it's dealers.

    If Fender dropped outside dealers altogether, and only sold direct, then they could indeed lower their prices.
     
    Stratoskater likes this.

  8. CalicoSkies

    CalicoSkies Senior Stratmaster

    Jun 10, 2013
    Hillsboro, OR, USA
    I can understand that, although it also seems a bit like price fixing, which I thought was illegal.. I'm not familiar with all the laws though.
     

  9. Musekatcher

    Musekatcher Strat-Talker

    Age:
    53
    396
    Jun 30, 2016
    Heart O' Dixie
    If China can retail Squier-like and Epiphone-like instruments with shipping for $39, I think Mexico can approach $75 for a guitar. There's just not much to a solidbody guitar. Maybe $15 of materials, and the rest is labor, much of which is assembly line, very efficient in large quantities. We may not like that we paid $500 for it, thinking it cost more to produce.
     
    axis69 likes this.

  10. RobZ69

    RobZ69 Strat-Talker

    Age:
    48
    380
    Apr 22, 2017
    The Netherlands
    Most of what you mention is cost of material. Fender doesn't generally use high cost exclusive materials, not even the custom shop (unless bespoke).
    Maybe $100 difference.
    Between, MIM and MIA even less.

    The real cost is labour. And I recon only Masterbuilt only cost significantly more hours per product than a MIM.

    So, it's all about the ratios labour cost versus numbers sold, versus margin achievable (hello, marketing department).
     
    Ebidis likes this.

  11. Guitarhacker

    Guitarhacker Strat-Talker

    388
    Apr 19, 2013
    California
    I think it all depends on the guitar and the market. I bought a Gibson Les Paul R0 in 2011 and its still pretty much holding its value. I will never sell that guitar anyway.
     

  12. Paperback Rocker

    Paperback Rocker Nitro-mancer Strat-Talk Supporter

    Sep 18, 2014
    Victoria TX
    Get real. I'm a good customer there, and they know me. They know I'm a guitar teacher, and I've sent a lot of business their way. I'm not some mark out there getting played for a fool buying guitars.

    The guitar was a Postmodern Journeyman, $3300 online. $2499 at Clawson's.
     
    Stratoskater, johnnymg and Ebidis like this.

  13. Bob the builder

    Bob the builder Senior Stratmaster

    Age:
    57
    May 2, 2016
    Cranston, Rhode Island
    Manufacturing has nowhere near 100% profit. There money is in big production runs at a much lower %.
     
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  14. Bob the builder

    Bob the builder Senior Stratmaster

    Age:
    57
    May 2, 2016
    Cranston, Rhode Island
    But why would they lower thier prices? They've already proved they can sell, let's just make all the $$$
     

  15. Ebidis

    Ebidis Providing the world with flat bends since 1985 Strat-Talk Supporter

    Age:
    51
    Nov 14, 2013
    Alabama
    I said they could. Could, and would, are two different things. ;)
     
    Bob the builder likes this.

  16. Stratoskater

    Stratoskater Senior Stratmaster

    Age:
    42
    Feb 8, 2011
    Raleigh NC
    Because as cheap as labor is in Mexico it’s still nothing compared to the slave labor in China. Mexican works can strike for better wages, etc. try that crap in China and not only do you loose your job but perhaps your life. This is why if I have any other reasonable option I will not buy stuff from China.
     

  17. Stratoskater

    Stratoskater Senior Stratmaster

    Age:
    42
    Feb 8, 2011
    Raleigh NC
    I’d wager the select 2 piece alder used in my EJ is more costly that the 5-7 pieces used in a MIM. I agree the labor is the big difference in price though. The signature models and AVRI have more details in the finishing too and the EPA regulations and cost of nitro drive it up more. I’m sure the price difference in MIA and MIM are much closer though.
     

  18. anderz

    anderz Strat-O-Master

    944
    May 4, 2014
    Denmark
    Cost is irrelevant the long time joy is the only thing that matters.

    You can always make the money you want.

    Multiple sources of income is the key to not trading time for money and leave investing to pros who knows what they are doing well.

    With the Internet you get leverage to setup multiple sources of income all working for you making your yearly income in a month.
     

  19. LeicaBoss

    LeicaBoss Senior Stratmaster Strat-Talk Supporter

    Sep 4, 2015
    New Jersey
    Value and "cost of manufacturing" aren't the same thing.
     
    RobZ69 and RJ Squirrel like this.

  20. Paperback Rocker

    Paperback Rocker Nitro-mancer Strat-Talk Supporter

    Sep 18, 2014
    Victoria TX
    Maybe Fender is keeping their margins tight because that puts pressure on their competitors. Maybe Fender thinks they are big enough to ride it out through this changing time in how musicians buy things while their competitors struggle as well, but without the resources and name Fender has.

    Just throwing it out there for discussion. I have no idea if this is valid whatsoever.