Daniel Quinn
Banned
All things that can be bought in if cheaper .
Linn Keel - What's so special?
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All things that can be bought in if cheaper .
The point is that outsourcing is not a guarantee of being cheaper, and we don't know the decision making process Linn went through in their decision to outsource, and to whom.
FWIW, I do think Linn's pricing for a lot of stuff is indefensible without the need to criticize them for things we, from the outside, can't possibly know.
There is no way Linn could have CNC'd the Keel in house as none of their products need the technology, which is very expensive.
My precision engineered aluminium turntable is made by a turntable division of a precision engineering company (Claro Precision Engineering Ltd) and they engineer turntables for other brands, costing upwards of £20,000.
My server (effectively a Naim UnitiServe) is cased in aluminium. The manufacturer (Tranquil plc) mainly make fanless servers. They have their own CNC kit and so it is better made than the Naim, much smaller and £500 cheaper.
Ava also made a 50w digital amplifier in aluminium casing for under £200. This is the process from a block of metal to a finished product.
http://ava-media.com/blog/?author=2&paged=2
My precision engineered aluminium turntable is made by a turntable division of a precision engineering company (Claro Precision Engineering Ltd) and they engineer turntables for other brands, costing upwards of £20,000.
My server (effectively a Naim UnitiServe) is cased in aluminium. The manufacturer (Tranquil plc) mainly make fanless servers. They have their own CNC kit and so it is better made than the Naim, much smaller and £500 cheaper.
Ava also made a 50w digital amplifier in aluminium casing for under £200. This is the process from a block of metal to a finished product.
http://ava-media.com/blog/?author=2&paged=2
John
Rack’em Up!
I am staggered that this bit of metal costs £2,450.
But then it's Linn, so maybe I'm not that staggered.
My point of reference is, of course, my own turntable, which is made entirely of precision machined aluminium, steel and acetal. And when I say precision, I mean 0.01mm tolerance, but then the manufacturer makes satellites and such like most of the time and have their own £multi-million CNC lathes.
http://www.claro-audio.co.uk/claro_newsite/blog/wp-content/uploads/2012/02/diagram-12.jpg
http://www.claro-audio.co.uk/claro_newsite/blog/black-beauty/
The base of my unit is probably three times more complex to manufacture than the Linn Keel, as it has fixings for two arms, two separate motor housings underneath, the bearing housing and the leg fittings. Taking all the other bits into account, it's seeming a bit of a bargain.
I do know that the power supply, which is solid aluminium and is a work of art, costs £450 to machine.
So how much should the Keel sell for? I would have been willing to go maybe $1,500.
I think people are rather missing the point about the price here.
As much as I consider the price way too high, the fact is, this is (mostly) free market economics, where the price is almost entirely dictated by what people are willing to pay for an item. That usually has, at best, only a remote correlation to the development and manufacturing costs.
And clearly, enough people are willing to pay Linn's price, so.......
As much as I consider the price way too high, the fact is, this is (mostly) free market economics, where the price is almost entirely dictated by what people are willing to pay for an item. That usually has, at best, only a remote correlation to the development and manufacturing costs.
And clearly, enough people are willing to pay Linn's price, so.......
Daniel Quinn
Banned
And what people are willing to pay for it may be determined by the profit margin . So there is no missing the point just a quest for knowledge .
Knowledge is power .
People seem to like paying the Linn price.
The aircon compressor on my wife's car went bang. The Honda genuine part was £900 and the (very popular) clone part £360. You want the branded thing so what do you do? I haggled with Honda and got it for £500. Unfortunately not many audio companies work like that.
If it's of interest, just checked Linn's 2014 accounts.
£19.2million sales
58.4% gross profit margin !!! 56.6% in 2013
8.9% net profit margin. 4.6% in 2013
£1.97million spent on R&D, but only £532,000 expensed in the year
75.6% of sales were for export
£427,000 directors costs.
Staff: 71 making, 31 R&D, 28 sales, 43 admin.
So they are not ripping you off, they just have a big overhead because they have a large and complex product range.
If the Keel is £2,350, £1,960 excl VAT, at 58.4% gross margin it would cost £814 to make. I suspect it costs a lot less than that, so they are charging a big premium compared to their normal margin.
£19.2million sales
58.4% gross profit margin !!! 56.6% in 2013
8.9% net profit margin. 4.6% in 2013
£1.97million spent on R&D, but only £532,000 expensed in the year
75.6% of sales were for export
£427,000 directors costs.
Staff: 71 making, 31 R&D, 28 sales, 43 admin.
So they are not ripping you off, they just have a big overhead because they have a large and complex product range.
If the Keel is £2,350, £1,960 excl VAT, at 58.4% gross margin it would cost £814 to make. I suspect it costs a lot less than that, so they are charging a big premium compared to their normal margin.
yuckyamson
pfm Member
I can't understand it. Why do some of you love bagging on Linn so much?
They make a good product. You're not obligated to buy it. You wanna B*tch, b*tch about taxes. That's something you have to pay. The fact that you can go out and buy a greenstreet for less is a great option (or Mark's new Tangerine thingy or a Rubikon or whatever) and clearly has reasons why they're less.
It's so easy to criticize but at the end of the day why is a manufacturer obligated to charge as little as possible for a product? It's "free market". If something is inappropriately priced it won't sell and they'll end up getting served for their mistake.
Man it's like a kvetch session out here.
They make a good product. You're not obligated to buy it. You wanna B*tch, b*tch about taxes. That's something you have to pay. The fact that you can go out and buy a greenstreet for less is a great option (or Mark's new Tangerine thingy or a Rubikon or whatever) and clearly has reasons why they're less.
It's so easy to criticize but at the end of the day why is a manufacturer obligated to charge as little as possible for a product? It's "free market". If something is inappropriately priced it won't sell and they'll end up getting served for their mistake.
Man it's like a kvetch session out here.
rhgbristol
pfm Member
I was lucky enough to have a keel when it first came out, along with Ekos SE and Akiva.
It was a nice enough sound but hardly value for money.
I'm now happy with the Lp12, basic chassis, ittok and 0c9.
I don't think I'm missing anything having climbed the tree and back down again.
It was a nice enough sound but hardly value for money.
I'm now happy with the Lp12, basic chassis, ittok and 0c9.
I don't think I'm missing anything having climbed the tree and back down again.
I bought Linn (Akurate) and sold the lot inside 18 months, so I'm allowed to kvetch. Found the sound dry and thin, dull frankly. I have just posted the figures and the fact is that it is a successful company but not unusually profitable because it obviously costs a lot of money to design, manufacture and market the product range, that seems to change far more rapidly than many other companies.
My Keel figures were wrong. Assume £2,000 retail net of VAT, retailer makes 30% so £1,400 to Linn, so 58.4% gross margin implies £582 cost to make. Still seems a bit high, so margin may be a bit higher.
pocketkitchen
Registered User
Interesting figures. Worth noting that margin won't necessarily be the same scross all lines though.
yuckyamson
pfm Member
yuckyamson
pfm Member
Out curiosity, what did you replace the Akurate with?
Replaced the ADS with a PS Audio DAC mk2
Replaced the 2200 amp with a Bryson 4BSST2, but found it slow to warm up and then fatiguing, so changed to a valve amp.
yuckyamson
pfm Member
And you're STILL kvetching? You suffered barely any loss for a system that you used for 18 months and YOU'RE complaining that you think it's bad value for money? I'd love to meet the guy you sold it to. Imagine how he would feel knowing that you basically charged him 50% mark-up when you take into account a 3%/month use value....wow. You're a ripper man. A real shark. I'm going to investigate your income and savings for the year and see just how UNjust your trades of hi-fi gear goes.
Anyway you never answered what did you replace it with?
Anyway you never answered what did you replace it with?
yuckyamson
pfm Member
You bought a 4B. A bryston. To replace a 2200. Man, now it's not just your scruples that are in question, also your sanity.