[BC] Absurd markups!

[Thomas G. Osenkowsky]

I am not trying to defend unreasonable markups, however,
here are a few reasons why some items cost more from one
source than others:

1. Buying parts from a transmitter manufacturer cost more
because that manufacturer has to outlay funds to purchase
the materials which may sit on a shelf for a considerable
period of time. Those funds could be earning interest. The
manufacturer has to pay Parts Department employees, many
times after hours. Those employees must be familiar with
the many products, often times very old products. The
manufacturer must maintain the infrastructure and utilities
for said storage. They have costs associated with the ability
to ship parts on-demand. They also have a right to earn a
profit after all this.
Some parts are "manufactured parts". These are specific to
their products and not available from wholesalers. Resistors,
capacitors, etc. are common parts. PDM coils, Harris FMx H
series PA tuning assemblies are not. There are manufacturing
costs associated with these and investing in making these
components and having them sit on a shelf only causes the
price to rise as the investment returns a zero dividend.

2. Some resellers purchase at a great quantity directly from
the component manufacturer. Independent record stores
frequently bought through one-stops whereas Tower,
Strawberries and other national chains bought direct in large
quantities. Wal*Mart versus the downtown store.

3. Some equipment manufacturers purchased large quantities
of overstock from component manufacturers. One transmitter
manufacturer had problems with intermittent RF Drive dropouts
on one of its transmitter lines. The problem was loss of drive
following a TTL divider chip. Input to the chip was fine. The
manufacturer bought thousands of 4.7V Zener diodes for very low
cost and used them as regulators for the TTL chip. That was on
the ragged edge so they had to issue a Service Bulletin and 5.1V
Zener diodes to all users.
When I worked in manufacturing years ago, the design had
something like a 98.8k 0.5% 1/4W ressitor in series with a 10k
single turn trimpot. From an engineering point it didn't make sense.
The company was able to purchase a large quantity of these at a
very reduced overstock price. 

4. Costs of transportation, storage, taxes, middle persons, etc.
all add to the final sale cost of a product. You will pay more in 
a mall store than you would at a large department store like Wal*Mart,
generally speaking.

Tom Osenkowsky, CPBE