What is the Parts Cost for pickups? Dead cost.

[Gearjoneser]

I realize any pickup company has to pay to design, manufacture, market, pay operating cost, but my question....

What is the total cost of the parts used in a Duncan, Dimarzio, EMG, Fralin
humbucker and single coil?

It may be a trade secret, but what is the approximate amount put into these?

 

[Jeff_H]

Re: What is the Parts Cost for pickups? Dead cost.

I'm just going to guess....and see how close I am.

$4 per pickup, wire, magnet, bobbin, dye, baseplate, wax....everything. $4

 

[Artie]

Re: What is the Parts Cost for pickups? Dead cost.

I'll bet that Jeff is real close. Unfortunately, some idiot will come along now and accuse SD of "ripping us off", 'cause they won't understand about winding machines, research & development, buildings, electricity, salaries, and toilet paper in the bathrooms.

Edit: By "idiot", I was not refering to any current SD forum members.

 

[beandip]

Re: What is the Parts Cost for pickups? Dead cost.

Not to mention the cost of pure mojo that Seymour has to put into every single pickup

 

[Bones]

Re: What is the Parts Cost for pickups? Dead cost.

Not to mention the cost of pure mojo that Seymour has to put into every single pickup

Brown noser

 

[7th Hell]

Re: What is the Parts Cost for pickups? Dead cost.

Or the cost of all the Monkey Brains and Cat Tails!

 

[aleclee]

Re: What is the Parts Cost for pickups? Dead cost.

I'll bet that Jeff is real close. Unfortunately, some idiot will come along now and accuse SD of "ripping us off", 'cause they won't understand about winding machines, research & development, buildings, electricity, salaries, and toilet paper in the bathrooms.

Edit: By "idiot", I was not refering to any current SD forum members.

If they did, I'd tell 'em this joke:

A guy spends his entire career working in a plant. He knows the place inside and out--better than anyone else in the place. One day he finally retires, takes his gold watch and goes home.

About a year later, something goes terribly wrong with one of the machines. Not even the machine's manufacturer knows what the problem is. The company is desparate and they beg the retiree to return as a consultant to diagnose the problem.

He walks in, looks around for about five minutes and draws an "X" on one of the parts of the malfunctioning machine. He then informs the plant manager that his fee is $50,000. The plant manager realizes that this is a lot more than they ever paid the guy when he was an employee so he asks for an itemized invoice. This is what he got:

Chalk Mark: $1
Knowing where to put it: $49,999

==========================

If you think that the expertise to design and wind pickups isn't worth a lot, try winding your own. If you place any value on your time, even Custom Shop pickups are a bargain.

FWIW, I'd bet that the raw materials' cost is more like 2-3 bucks (unless magnets are way more expensive than I'm guessing) in industrial-size quantities. Of course, having winding machines, employees, buildings, and all that stuff add to the cost as well.

 

[Farkus]

Re: What is the Parts Cost for pickups? Dead cost.

It's so funny, I was actually thinking about this topic this morning...

I was wondering how many pickups SD has to sell just to pay his employees. I mean, if you think about it, the guitar market isn't really all that large, and of that market, you have to consider that many of us don't even switch out pickups to start with. Then, you have your dedicated users of other manufacturers' pups. Then, that leaves you with SD's slice of the pie. Now, granted, many of us have multiple SD pups, but still, it's a market that could be easily saturated if pups were too cheap, and it would dry up if they're too expensive. Needless to say, I think the pup business would be tough from the ownership standpoint.

So, I think that while the pups PARTS probably cost $4-5 American, someone has to stand by the pup winder (overhead), put them into the plastic boxes (overhead), ship them to dealers (overhead)...all of this is besides the time devoted to R+D.

I feel fortunate that the pups aren't more expensive, to be honest.

Farkus

 

[Kent S.]

Re: What is the Parts Cost for pickups? Dead cost.

If they did, I'd tell 'em this joke:

A guy spends his entire career working in a plant. He knows the place inside and out--better than anyone else in the place. One day he finally retires, takes his gold watch and goes home.

About a year later, something goes terribly wrong with one of the machines. Not even the machine's manufacturer knows what the problem is. The company is desparate and they beg the retiree to return as a consultant to diagnose the problem.

He walks in, looks around for about five minutes and draws an "X" on one of the parts of the malfunctioning machine. He then informs the plant manager that his fee is $50,000. The plant manager realizes that this is a lot more than they ever paid the guy when he was an employee so he asks for an itemized invoice. This is what he got:

Chalk Mark: $1
Knowing where to put it: $49,999

==========================

If you think that the expertise to design and wind pickups isn't worth a lot, try winding your own. If you place any value on your time, even Custom Shop pickups are a bargain.

FWIW, I'd bet that the raw materials' cost is more like 2-3 bucks (unless magnets are way more expensive than I'm guessing) in industrial-size quantities. Of course, having winding machines, employees, buildings, and all that stuff add to the cost as well.

Excellent post, and well said! ...

 

[Kent S.]

Re: What is the Parts Cost for pickups? Dead cost.

I'm going to guess higher though, for single coils $8 for HBs $12, I remember Lindy used to sell singles for $30 a piece, and he wasn't making much on it ... a lot of people miss the facts of all the aforementioned points though, pertaining to the business in it's entire aspect. It would be interesting to hear a correct ball park answer though, just to be in the know.

 

[dr.barlo]

Re: What is the Parts Cost for pickups? Dead cost.

I'd say Kent is right, checking the ampge prices. Of course a pickup manufacturer gets those parts in lots, hence cheaper.

And the knowledge of how to do it is called human capital in economics, not just labor. This distinction (labor vs human capital) is essential. Aleclee gave a great example, another one would be seen when considering a heart operation. The material cost is virtually noting, some blood, and other equipment which all are fixed costs. Yet, that does not mean anybody can do it!

B

 

[Kent S.]

Re: What is the Parts Cost for pickups? Dead cost.

I'd say Kent is right, checking the ampge prices. Of course a pickup manufacturer gets those parts in lots, hence cheaper.

If I am I'd love to know it ... because it was just an off the top of my head guess ...

And the knowledge of how to do it is called human capital in economics, not just labor. This distinction (labor vs human capital) is essential. Aleclee gave a great example, another one would be seen when considering a heart operation. The material cost is virtually noting, some blood, and other equipment which all are fixed costs. Yet, that does not mean anybody can do it!

B

Thanks you B, I was wondering what the term for that was (skills baby, skills), not only is there labor involved but human capital as well, then one might add material resources ... not the same as materials, but the resources of such ... tracking, suppliers, evaluation of materials, procurement and transportation, etc.

 

[dr.barlo]

Re: What is the Parts Cost for pickups? Dead cost.

Thanks you B, I was wondering what the term for that was (skills baby, skills), not only is there labor involved but human capital as well, then one might add material resources ... not the same as materials, but the resources of such ... tracking, suppliers, evaluation of materials, procurement and transportation, etc.

Sure. The thing is in economics there is a distinction between skills and human capital. More skill would refer to the ability to acquire human capital (the ability to perform better, experience whatever...) faster. I see why those terms might be confusing, but we need standards one way or the other.

B

 

[Kent S.]

Re: What is the Parts Cost for pickups? Dead cost.

Sure. The thing is in economics there is a distinction between skills and human capital. More skill would refer to the ability to acquire human capital (the ability to perform better, experience whatever...) faster. I see why those terms might be confusing, but we need standards one way or the other.

B

Your right ... now I'm confused ... I thought I understood what you meant by human capital ...oh well sleep time....

 

[dr.barlo]

Re: What is the Parts Cost for pickups? Dead cost.

Your right ... now I'm confused ... I thought I understood what you meant by human capital ...oh well sleep time....

Sleep well!

B

 

[Curly]

Re: What is the Parts Cost for pickups? Dead cost.

although the raw material cost, as in a lot of manufacturing, is not great, the fact is that Seymour's gone to a lot of trouble to provide stuff like the "right" material for bobbins and spacers on pickups like the Seth, in order to produce something that's honest to the original, both tone and material wise

that took time, experience and reverse engineering to get right

stuff like the aging on my Antiquities is pure alchemy .... back in the Middle Ages, he coulda been arrested! ... and THAT has nothing to do with material cost, but EVERYTHING to do with "getting it right"

I'm pretty sure Joneser didn't intend to start a debate, but was just curious. But, you could apply the same question to a lot of manufacturing:
"Why is that Mercedes $80,000 - it's only $400 worth of raw steel?"

if you look at this from another angle, why don't other pickup makers use better grade materials, if the material cost is not much to begin with?

when I replaced the stock Fender pickups on my AS tele recently, the Fender pickups had plastic parts, like on the base plate, where Seymour's had metal. I don't know, SDs stuff just seems more real, honest, and authentic to me ... it's a company ethic, I'm sure.

you know, in a way, Seymour took what was a repair business, and turned it into an industry.

 

[theboatcandream]

Re: What is the Parts Cost for pickups? Dead cost.

I think that cheeper is better, but I do not expect companies to sell their product for just enough to prevent their employees from starving.

 

[Lightning]

Re: What is the Parts Cost for pickups? Dead cost.

@ ampge $8.22 Stainless frame, $11.57 Nickle frame. Doesn't include coil wire or cover. Kinda makes you realize what a value SD & DMZs are!!!

 

[Evan Skopp]

Re: What is the Parts Cost for pickups? Dead cost.

Here's a weird thing... even though we're the biggest and we buy in larger quantities than our competition, our prices for raw materials are often higher than our competition. Why? Because our quality standards are higher than "Industry Standards."

For example, our magnet wire has a tolerance of +/- 5%. We could get cheaper wire with a wider tolerance, but then the d.c. resistance of the pickups would be all over the map.

The nickel and gold plating on our humbucker covers is higher than industry standards, which means each substrate has to be hand buffed for twice the time as a standard nickel-silver cover. We end up paying a 30% surcharge for this.

On the Seths and Antiquity humbuckers, the bobbins are made of a type of plastic called "butyrate." This is the same plastic Gibson used on the originals P.A.F.s. Practically nobody uses butyrate anymore. And what happens if you pop the cover off a Seth or Ant? You might find a cream-colored bobbin underneath. That means we not only had to source butyrate, but cream butyrate dye -- and color match it to our polycarbonate cream dye.

Plus, a lot of the raw materials are custom-made for us. Things like single-conductor braided shield cable is not an off-the-shelf item. Or the waxed cloth cable used on vintage single coils. Or the wooden spacers used on the vintage pickups. Honestly, our Purchasing Guy gets laughed at half the time he gets on the phone to source a lot of our materials. :laugh2:

Then, there's things like the cost of keeping the Leesona winder up running. Hand-removal of the hot wax. All the custom-made tools and dies. Plus, the cost of manufacturing in Santa Barbara, California, where the median home price is over $1 million.

:smack:

Oh, and so far, all your guesses are low. But that's all I can say.

 

[flank]

Re: What is the Parts Cost for pickups? Dead cost.

evan... everything about what you just said is so kick A S S