Thread: Mega buck systems.

I was browsing the Munich thread and most of the pics were of super expensive systems. I wonder if there is actually a market for systems like these. Where I live the Magico dealers don’t have anything above the S5 or most likely only the S3 in store. The Raidho dealers stop at the D3 and Wilson dealers might have a Sabrina or Yvette but nothing above that.
So I wonder if there actually is a market for the mega buck systems (systems above €100k) or if the top end speakers, DACs, etc are mostly for marketing purposes.

There are very few people in the world that can truly afford the Uber expensive gear.

The median income for a family of 4 in the Minneapolis area is 67,000. If I recall, West Palm Beach was around 51,000. 100k in disposable cash is more than most people will ever see. When a product reaches that price tag, it’s not going to fly off the shelves.

Not to mention the dealers buy the floor items, so it’s a huge risk to have the mega buck items in stock given the incredibly small section of the population that could afford them.


Sent from my iPhone using Tapatalk

The people shopping for Harbeth 30.2’s are amazed someone actually buys a much more expensive speaker like Magico S5’s or Avantgarde Duo’s. People buying S5’s are amazed someone buys a more expensive speaker like M3’s. People buying M3’s are.... you get the point.

Yes, people buy equipment across a wide variety of price points.

I’ve sold several pairs of speakers costing well over $150,000. What may surprise you is that 85% or my customers are not on any forum. They’re too busy installing knees and shoulders (Orthopedic Surgeon) or working as a world class eye surgeon or running multiple successful businesses or a top lawyer in Manhattan. I just spent two days in my store with a top attorney from New York because he disliked all the New York dealers and their attitudes and had several things to hear and buy to build out his system.

As for demos, well, yes, we have to buy all of our equipment. That’s why I’m very picky over what I bring in and only bring in what I love and what I would buy myself....because I do have to actually buy it!

Originally Posted by Mordante

I was browsing the Munich thread and most of the pics were of super expensive systems. I wonder if there is actually a market for systems like these. Where I live the Magico dealers don’t have anything above the S5 or most likely only the S3 in store. The Raidho dealers stop at the D3 and Wilson dealers might have a Sabrina or Yvette but nothing above that.
So I wonder if there actually is a market for the mega buck systems (systems above €100k) or if the top end speakers, DACs, etc are mostly for marketing purposes.

Yes .


Sent from my iPad using Tapatalk

There’s a market for everything, the more expensive, fewer buyers

I get what the OP is saying though

Something else to ponder is items purchased and hardly used cost even more.

Assuming one puts together a 100K system and listens to it 4 hours per week, for 5 years it comes to something like $96 per hour or $384 a week.

For the finance guys what would that look if it was invested for that same period?

For the psychology guys what would this do to a person not having the mega buck system?


Sent from my iPhone using Tapatalk Pro

Originally Posted by Phishphan

There are very few people in the world that can truly afford the Uber expensive gear.

The median income for a family of 4 in the Minneapolis area is 67,000. If I recall, West Palm Beach was around 51,000. 100k in disposable cash is more than most people will ever see. When a product reaches that price tag, it’s not going to fly off the shelves.

Not to mention the dealers buy the floor items, so it’s a huge risk to have the mega buck items in stock given the incredibly small section of the population that could afford them.


Sent from my iPhone using Tapatalk

The average income for a family with children would be around euro80k before tax. So after tax that would be around euro40k

Originally Posted by Mike

The people shopping for Harbeth 30.2’s are amazed someone actually buys a much more expensive speaker like Magico S5’s or Avantgarde Duo’s. People buying S5’s are amazed someone buys a more expensive speaker like M3’s. People buying M3’s are.... you get the point.

Yes, people buy equipment across a wide variety of price points.

I’ve sold several pairs of speakers costing well over $150,000. What may surprise you is that 85% or my customers are not on any forum. They’re too busy installing knees and shoulders (Orthopedic Surgeon) or working as a world class eye surgeon or running multiple successful businesses or a top lawyer in Manhattan. I just spent two days in my store with a top attorney from New York because he disliked all the New York dealers and their attitudes and had several things to hear and buy to build out his system.

As for demos, well, yes, we have to buy all of our equipment. That’s why I’m very picky over what I bring in and only bring in what I love and what I would buy myself....because I do have to actually buy it!

Maybe it is because in the USA consumer goods tend to be cheaper and wages are higher.

As example the S5mkII costs about $38k in the USA and $59k in the Netherlands in basic M cast finish. A surgeon working for hospital would earn between €70k and €130k a surgeon working for himself might earn max €250k annually before tax. So a surgeon at the top of his career can maybe afford a S5 mkII. A top lawyer might earn €250k.

My dealer is also very picky. That is why he will not buy speakers for his store costing more than say €80k since there is no market for anything more expensive. He sometimes has a "statement product". Years back he had a pair of the Magico M5 speakers the wooden model and now he has the small EMM labs mono amps. But no shop actually has stuff like MSB dacs, TechDas turntables or Kronos turntables on stock. At least not with a few hundred km from where I live.

There is another aspect to this as well why most shops don't have the super expensive gear on stock. But that is for another discussion.

Big egos generally need big expensive gear. The number of high end set ups (100k and up) that I've seen and heard that don't live up to their potential is greater than one would think.

Originally Posted by Mordante

I was browsing the Munich thread and most of the pics were of super expensive systems.

Yes, it looks more like a high fashion jewelry show.
But keep in mind, it is very expensive to exhibit there. I think close to 10k euro for even a small room, far more for the bigger ones. As such, it would make little sense for a manufacturer to show their entry level $1-3k equipment...even though that is probably what the vast majority of show attendees can afford. Especially the younger crowd "budding audiophile", which many high end writers pay lip service lamenting about...then go on to swoon almost exclusively over the mega price jewelry.
If the exhibit spaces were significantly less costly, an exhibitor might be more tempted to show both lower and higher ends of line, perhaps in multiple rooms, as to appeal to a wider array of the spectrum of attendees. Perhaps a win win for both seller and consumer.

Originally Posted by ben

Mike, you brought a good point. I really don't understand why manufactures expect dealers to pay full MSRP to demo their products? Wouldn't it be better if they loan few samples to the dealers for demo with condition that if dealers able to sell certain number of units in certain time period then dealers don't have to pay for the demo samples or just pay only manufacturing costs. They don't have to carry the entire lines but just few samples. This way dealers don't have to invest so much in inventory, manufactures able to increase their dealer networks, and increase sales. These days more and more B&M stores are closing and cost of high end gears are getting higher and higher. My jaw dropped when I looked at the price of new Dynaudio Confidence line, Dan D'agostino monster monoblocks costing $250K per pair.

An awesome idea. I would support that big time. To their credit, that’s what Lampizator did with me and they were rewarded with sales they would not have otherwise received.


Sent from my iPhone using Tapatalk

Originally Posted by Mike

The people shopping for Harbeth 30.2’s are amazed someone actually buys a much more expensive speaker like Magico S5’s or Avantgarde Duo’s. People buying S5’s are amazed someone buys a more expensive speaker like M3’s. People buying M3’s are.... you get the point.

Yes, people buy equipment across a wide variety of price points.

I’ve sold several pairs of speakers costing well over $150,000. What may surprise you is that 85% or my customers are not on any forum. They’re too busy installing knees and shoulders (Orthopedic Surgeon) or working as a world class eye surgeon or running multiple successful businesses or a top lawyer in Manhattan. I just spent two days in my store with a top attorney from New York because he disliked all the New York dealers and their attitudes and had several things to hear and buy to build out his system.

As for demos, well, yes, we have to buy all of our equipment. That’s why I’m very picky over what I bring in and only bring in what I love and what I would buy myself....because I do have to actually buy it!

My post may be a little OT, but something Mike said made me want to say something.

This reminded me of an experience I had last year. I went to my favorite Portland, OR dealer to ask about auditioning a pair of speakers. They are a Spendor dealer. I really wanted to audition the SP100 speakers, but was told they would have to first buy a pair in order to have them in store. At $10k they'd be lucky to sell one pair per year. If I didn't like them enough to buy them, the dealer might be stuck with them for many months or longer. It turns out no one within many hundreds of miles had a pair. I did spend 2 hours listening to their Focal Sopra No.3 demo speakers, but decided they weren't what I wanted.

Soon after, I drove something like 6 hours north to the Daedalus Audio showroom/workspace to audition three pairs of floor standers. That was enough to convince me to buy a pair of Lou's new Apollo speakers. A six hour drive is nothing to sneeze at, but it beats having to fly to LA, Chicago, or New York to audition a pair of SP100 speakers. It must be tough to be a brick & mortar dealer now.

Originally Posted by mresseguie

My post may be a little OT, but something Mike said made me want to say something.

This reminded me of an experience I had last year. I went to my favorite Portland, OR dealer to ask about auditioning a pair of speakers. They are a Spendor dealer. I really wanted to audition the SP100 speakers, but was told they would have to first buy a pair in order to have them in store. At $10k they'd be lucky to sell one pair per year. If I didn't like them enough to buy them, the dealer might be stuck with them for many months or longer. It turns out no one within many hundreds of miles had a pair. I did spend 2 hours listening to their Focal Sopra No.3 demo speakers, but decided they weren't what I wanted.

Soon after, I drove something like 6 hours north to the Daedalus Audio showroom/workspace to audition three pairs of floor standers. That was enough to convince me to buy a pair of Lou's new Apollo speakers. A six hour drive is nothing to sneeze at, but it beats having to fly to LA, Chicago, or New York to audition a pair of SP100 speakers. It must be tough to be a brick & mortar dealer now.

It's definitely interesting. I come from a background of over 25 years dealing with huge multi-billion dollar companies like Coca-Cola, Bristol-Myers Squibb, Nike, US Army, Navy, etc. So, I find the audio industry a refreshing change, but not without its quirks thats for sure. I would love to sometime sit down over a drink and tell you about some of the interesting things that go on. For the most part, the manufacturers are awesome. Really terrific people and fun to deal with. They are also very supportive.

As for the model of speaker you wanted to hear, I can sympathize with that other dealer. I've had more than a few folks ask about the S7's and I have the A3's, S3 mk2's, S5 mk2's and M3's. You just can't have them all. Luckily, I have local customers who have been willing to open up their homes and demo their S7's with me for the customer.

Originally Posted by ben

Mike, you brought a good point. I really don't understand why manufactures expect dealers to pay full MSRP to demo their products? Wouldn't it be better if they loan few samples to the dealers for demo with condition that if dealers able to sell certain number of units in certain time period then dealers don't have to pay for the demo samples or just pay only manufacturing costs. They don't have to carry the entire lines but just few samples. This way dealers don't have to invest so much in inventory, manufactures able to increase their dealer networks, and increase sales. These days more and more B&M stores are closing and cost of high end gears are getting higher and higher. My jaw dropped when I looked at the price of new Dynaudio Confidence line, Dan D'agostino monster monoblocks costing $250K per pair.

What makes you you think dealers pay full MSRP for any products they purchase from an OEM?

Originally Posted by Mikado463

The number of high end set ups (100k and up) that I've seen and heard that don't live up to their potential is greater than one would think.

Agreed.

Nowhere close to their true potential as opposed to how they perform when (or if) set-up properly.

And yes, there are definitely a number of components that simply don't compete at their price points.

IMO.

Originally Posted by ben

Mike, you brought a good point. I really don't understand why manufactures expect dealers to pay full MSRP to demo their products? Wouldn't it be better if they loan few samples to the dealers for demo with condition that if dealers able to sell certain number of units in certain time period then dealers don't have to pay for the demo samples or just pay only manufacturing costs. They don't have to carry the entire lines but just few samples. This way dealers don't have to invest so much in inventory, manufactures able to increase their dealer networks, and increase sales. These days more and more B&M stores are closing and cost of high end gears are getting higher and higher. My jaw dropped when I looked at the price of new Dynaudio Confidence line, Dan D'agostino monster monoblocks costing $250K per pair.

I think there are some problems with this idea. Most manufacturers don't deal with dealers, they deal with distributors. Distributors are often not big companies. I have seen distributors where only one persons works. Sometimes even as a side job because there is little money to be earned in it. Some distributors are a little bigger but most of the time no bigger than three of four people.

Also some brands/distributors "force" shops to sell the whole product line while the retailer might only be interested in one or two products.

Originally Posted by Mordante

I think there are some problems with this idea. Most manufacturers don't deal with dealers, they deal with distributors. Distributors are often not big companies. I have seen distributors where only one persons works. Sometimes even as a side job because there is little money to be earned in it. Some distributors are a little bigger but most of the time no bigger than three of four people.

Also some brands/distributors "force" shops to sell the whole product line while the retailer might only be interested in one or two products.

That’s changing because too many distributors acted like sole sellers.


Sent from my iPhone using Tapatalk

Originally Posted by Mordante

The average income for a family with children would be around euro80k before tax. So after tax that would be around euro40k



Maybe it is because in the USA consumer goods tend to be cheaper and wages are higher.

As example the S5mkII costs about $38k in the USA and $59k in the Netherlands in basic M cast finish. A surgeon working for hospital would earn between €70k and €130k a surgeon working for himself might earn max €250k annually before tax. So a surgeon at the top of his career can maybe afford a S5 mkII. A top lawyer might earn €250k.

My dealer is also very picky. That is why he will not buy speakers for his store costing more than say €80k since there is no market for anything more expensive. He sometimes has a "statement product". Years back he had a pair of the Magico M5 speakers the wooden model and now he has the small EMM labs mono amps. But no shop actually has stuff like MSB dacs, TechDas turntables or Kronos turntables on stock. At least not with a few hundred km from where I live.

There is another aspect to this as well why most shops don't have the super expensive gear on stock. But that is for another discussion.

I think you might be surprised.
I don't know how the situation is in the Netherlands, but in Belgium we still have a handful of stores (Antwerp, Gent, Brussels) with amazing gear in stock and on demo.

As Mike stated, guys with megabuck systems don't always post on forums, but they do exist.
And by the way, there are lawyers and doctors also in our countries who earn millions of € per year.
As there are very wealthy people with their own business(es).
And then you have people who retire, having saved a good sum of money, that buy a dream system for 100-200K.

Originally Posted by Mike

That’s changing because too many distributors acted like sole sellers.


Sent from my iPhone using Tapatalk

Maybe it is changing in the states. But as far as I can tell not in Europe. Most manufacturers don't want to deal with all the different languages and different laws/rules within Europe. Also with the top brands you only need one or two points of sales within a country. So if the distributor is also the sole seller I don't see the problem. How many MSB point of sale doe you need in the EU? I would guess no more then three maybe four.

Originally Posted by bart

I think you might be surprised.
I don't know how the situation is in the Netherlands, but in Belgium we still have a handful of stores (Antwerp, Gent, Brussels) with amazing gear in stock and on demo.

As Mike stated, guys with megabuck systems don't always post on forums, but they do exist.
And by the way, there are lawyers and doctors also in our countries who earn millions of € per year.
As there are very wealthy people with their own business(es).
And then you have people who retire, having saved a good sum of money, that buy a dream system for 100-200K.

In the Netherlands there are as far as I know 3 high end audio shops.

A10 Amsterdam http://a10audio.nl/
Chattelin the Hague http://chattelin.nl
Rhapsody Hilversum https://rhapsody.nl/

I don't think one of them has the mega buck systems. They are all great stored and can provide great gear but don't expect them to have €250k speakers in store or a TechDas airforce one. According to the latest stats of all people who pay taxes about 1.3% earn more than €100k.

My generation I'm borne in 1975 will never retire. I am estimating that buy the time I'll reach 70(retirement age) all the crooks (bankers and insurance people) will have made sure there will be no more retirement. Work till you die just like the pre war generation.

Originally Posted by Mordante

In the Netherlands there are as far as I know 3 high end audio shops.

A10 Amsterdam http://a10audio.nl/
Chattelin the Hague http://chattelin.nl
Rhapsody Hilversum https://rhapsody.nl/

I don't think one of them has the mega buck systems. They are all great stored and can provide great gear but don't expect them to have €250k speakers in store or a TechDas airforce one. According to the latest stats of all people who pay taxes about 1.3% earn more than €100k.

My generation I'm borne in 1975 will never retire. I am estimating that buy the time I'll reach 70(retirement age) all the crooks (bankers and insurance people) will have made sure there will be no more retirement. Work till you die just like the pre war generation.

I think it's fair to say, what works in Europe doesn't work in the U.S. and visa versa. The European companies are the ones smartening up and creating U.S. divisions, essentially hiring a rep or two. I will tell you, for the most part, it works very well. There are of course a few exceptions and some exceptional distributors (instead of Manufacturer reps), but for the most part you don't have to look too far: CH, T+A, etc. All positive changes in my book.

This thread has definitely got off topic. It was my fault.

....ok, back to megabuck systems!

It was not so far off topic Mike, and it is interesting.

Originally Posted by bart

It was not so far off topic Mike, and it is interesting.

True.

Originally Posted by Mike

This thread has definitely got off topic. It was my fault.

....ok, back to megabuck systems!

All is fine IMHO as long as it's an interesting discussion.

Also I'm a pessimist/nihilist/existentialist by nature so I prefer to see the gloom and doom.

The top 0.2% of households in the US have net assets of $20M or more. That makes 250,000 households. Europe should be similar (larger population but fewer at the top end of assets). Not sure about Asia, but certainly Japan and China have large numbers of very wealthy households. I wouldn't be surprised if the total number of $20M net worth households worldwide is between 500,000 and 1,000,000. Take a look at an issue of Robb Report, the lifestyle magazine for the very wealthy (circulation around 175,000 monthly). There are ads for high end watches, cars, airplanes, and hifi equipment - like Wilson and Magico. (Robb Report was said to be Michael Jackson's favorite magazine!).

I know a dealer for whom many (most?) of his clients are in the top category. Many (most?) of these high end clients want very personal service and they come to him because their friends recommend him and they have seen/heard their friends systems. They pay cash (no CC's) and always full retail. Price is secondary to the dealer's service, experience, knowledge and honesty. They will fly to his place to audition the equipment and he will ship a set of speakers or other equipment to their homes and then fly out to set the equipment up so they can audition in their own home at his own expense. Some have multiple residences and he has sold multiple systems, one or more for each residence. We have to remember that rich people have rich friends.

Larry

Originally Posted by Mordante

I was browsing the Munich thread and most of the pics were of super expensive systems. I wonder if there is actually a market for systems like these. Where I live the Magico dealers don’t have anything above the S5 or most likely only the S3 in store. The Raidho dealers stop at the D3 and Wilson dealers might have a Sabrina or Yvette but nothing above that.
So I wonder if there actually is a market for the mega buck systems (systems above €100k) or if the top end speakers, DACs, etc are mostly for marketing purposes.

The only Wilson speaker my dealer doesn't have in his store for audition is the WAMM. In general that is the same for every product line he carries. All of the current products for McIntosh, Sonus Faber, Audio Research, B&W, and dCS. Occasionally he might not have both the 800 and 802 or the Aida II.

I retired at 45...guess I should start digging my hole now and making out the will. Who is going to get all my stereo equipment?? Hmmmm.

Originally Posted by Mordante

Also I'm a pessimist/nihilist/existentialist by nature so I prefer to see the gloom and doom.

Wow, I'm sure you're a lot of fun at a wedding ...........

Originally Posted by UltraFast69

There’s a market for everything, the more expensive, fewer buyers

I get what the OP is saying though

Something else to ponder is items purchased and hardly used cost even more.

Assuming one puts together a 100K system and listens to it 4 hours per week, for 5 years it comes to something like $96 per hour or $384 a week.

For the finance guys what would that look if it was invested for that same period?

For the psychology guys what would this do to a person not having the mega buck system?


Sent from my iPhone using Tapatalk Pro

Only 4 hours p/w? I am 20-30 hours p/w. Sometimes more. I am not at 100k. But that is not a bad hourly rate

Originally Posted by Mikado463

Wow, I'm sure you're a lot of fun at a wedding ...........

Might be one of the few there with something thought provoking to talk about...

Originally Posted by Priaptor

I don't know how you do it. I tried retiring at in 2007. I drove my wife crazy, my three dogs crazy and ultimately myself crazy. My retirement lasted all of 3 months.

I understand different strokes for different folks but I couldn't handle retirement, it was way too STRESSFUL.

I will be 69 in a few months, and still working. Need to if I want a mega buck system.

Originally Posted by Mikado463

Wow, I'm sure you're a lot of fun at a wedding ...........

Knowing that life is meaningless and that the only one who can add a purpose/goals to life is yourself doesnt mean we cant be fun at parties.

Originally Posted by Priaptor

From my perch, dogs are so much more fun, trustworthy and smarter than humans.

Yeah, but they make very poor designers of electro-acoustic stereo equipment, so you'll have to put up with the humans for a bit more.