Let us start with the price of a small ship, $15 for easy figuring.

Assuming a 50% markup, the retailer would be paying $10 for the small ship. Since places can sell it for less and make money, such as MM at $10, ($9.99 rounded again), they obviously dont pay that much!

Assuming a 33% markup, $7.50 would fit as that also fits for places like MM, as they would be making $2.50 per ship which is 33% of $7.50. (Which also fits a retail price of $15 after a 100% markup!)

With a 50% markup, they would be paying $6.66 and with a 100% markup, MM's cost would be $5 per small ship.

With these assumptions in place, FFG is probably charging their distributors somewhere between, $5 and $7.50 per ship!

So looking at the numbers, and thinking of normal manufacturing cost to retail prices I am willing to put FFG's cost of manufacturing a small ship between $2.50 and $3.50!!

So what is my point!?! FFG is making money on XWing by selling LOTS of ships! They make a little money on one ship, the distributors make a little more and the retailers make some more!! But no single entity is making a ton of money on that $10 or $15 ship! It is spread out!

I think they have the pricing set to what the market can bear while keeping the number of units sold at a maximum! Its basic economics!

Bah, I had a full detailed response all typed, and then hit the wrong button and lost it all. I'm not going to get in as depth this time around, but the numbers I was running from backwards to forwards basically said that they had about $3.50 invested to get a ship to the distributor. (Included in this was the cost of: Cycle time of an injection molding machine, overhead for the facilities, pennies for the labor to assemble and paint, cardboard/cards/packaging, shipping across the sea, R+D, FFG overhead, ED+T)

So if they're selling it to the distributor at $5, they're only making about $.75 per ship. Being that they're made in China, they need to have a Joint Venture with a Chinese company, who is going to make at least 50% of the profits. Which is why I would think that the distributor is likely to be paying at least $7 for the ships.

This would mean that FFG makes almost $2 bucks for each ship sold, for a margin of 25%. It would also mean that the distributors would be selling them at $10 to the stores, and MM and the like that act as distributors would be making $3/ship, for a margin of 42%. And then the retail stores selling them at MSRP are making 50% margin.

I would expect the distributors to make the lowest margin though as they have the least risk. Though to be fair, I'm not including any of their costs such as their warehouses, workers, or shipping, so they're actually going to be much lower than the 42% margin that I stated. Retail stores also have their overhead that would reduce the margin.

At this point, the retailer has the highest risk, so it makes sense that they have the highest margin. However, FFG had the highest risk when it first launched the game, which could account for why W1 and W2 were so scare - minimize the tooling and investment to just bare minimums.

I ran out of likes for today!

Thanks for the extra details, Khyros! I was going off basic economic assumptions, so its nice to see your numbers!

I agree completely with your comment that retailers are looking at the greatest margin! Hence, why there is such a range of prices!

Let us start with the price of a small ship, $15 for easy figuring.

Assuming a 50% markup, the retailer would be paying $10 for the small ship. Since places can sell it for less and make money, such as MM at $10, ($9.99 rounded again), they obviously dont pay that much!

Assuming a 33% markup, $7.50 would fit as that also fits for places like MM, as they would be making $2.50 per ship which is 33% of $7.50. (Which also fits a retail price of $15 after a 100% markup!)

With a 50% markup, they would be paying $6.66 and with a 100% markup, MM's cost would be $5 per small ship.

With these assumptions in place, FFG is probably charging their distributors somewhere between, $5 and $7.50 per ship!

So looking at the numbers, and thinking of normal manufacturing cost to retail prices I am willing to put FFG's cost of manufacturing a small ship between $2.50 and $3.50!!

So what is my point!?! FFG is making money on XWing by selling LOTS of ships! They make a little money on one ship, the distributors make a little more and the retailers make some more!! But no single entity is making a ton of money on that $10 or $15 ship! It is spread out!

I think they have the pricing set to what the market can bear while keeping the number of units sold at a maximum! Its basic economics!

Spoken like a true mathematician.

Uh, yeah, like you said, economics 101. FFG is a business like any other, trying to minimize risk and maximize profit. It's also an entertainment business so it needs to have a watchful eye on the desires of the customer base.

I'm not sure what the point of the OP was other than to show that the reasonably priced expansions are in fact reasonably priced due to several factors determined by the market and the nature of retail. Must be a lot of folks out there that don't realize this if this counts as a major revelation.

Also don't forget the power of dealing in bulk leading to 'discount' pricing.

I still don't know how many people on this forum own their own business!

http://www.games-workshop.com/en-GB/Celestant-Prime?_requestid=17916840

1 plastic model made in the UK supplied unpainted and unassembled for £48.

So no i don't really begrudge £10 for a ship, i can build an okay little squad for the price of that single hero.

Yep, that was my only intent! There are some that inevitably dont understand how all the "middlemen" end up making the product cost so much more than what it is "manufactured" for. Manufacturing costs, ie just the factory aspect is really just one part in the grand scheme of things.

http://www.games-workshop.com/en-GB/Celestant-Prime?_requestid=17916840

1 plastic model made in the UK supplied unpainted and unassembled for £48.

So no i don't really begrudge £10 for a ship, i can build an okay little squad for the price of that single hero.

Hmmm,

There are a lot of things that can be thrown at GW, but trying to compare an X-Wing model to a GW model is laughable. To date there is not a single X-Wing model that comes close to the detail or quality of a GW one.

A box of Space Marines costs £25, which means that a single Space Marine is £2.50. That single Space Marine is comparable in size to an X-Wing and bigger than an A-Wing. It is also much better quality, far more detailed and can be customised to suit your needs. Yes, you have to build it and paint it, but that's part of the hobby.

If FFG made models to the same standard as GW, then trust me, you wouldn't be paying such a small price for them.

Cheers

Baaa

Plastic isn't that expensive but you need the machines to form the plastic, you have to make the molds, then you have to have it glued together and then have it painted.

Then you have to have packaging made, cards printed then have it all shipped over.

Plus it's a company so they have to make a profit or they cant produce future items.

And of course shops have utility bills and it all adds up.

But you generally get good value for money each ship is 25%-50% of a list.

Compare that to 10 space marines for £25 thats 10% of your list at most, £22 for a captain thats 5% of your list.

Age of sigmar is even worse your looking at £5 per troop model £7 per elite model.

Yep, that was my only intent! There are some that inevitably dont understand how all the "middlemen" end up making the product cost so much more than what it is "manufactured" for. Manufacturing costs, ie just the factory aspect is really just one part in the grand scheme of things.

Blaming everything on the middleman would be great, except for the fact that they are working within very tight margins between the manufacturers cost price and the RRP. Some online sellers can only be making a pound or two on what they buy the individual unit for, and to make a decent amount of money at all, they need to sell a lot of blisters.

Cheers

Baaa

Plastic isn't that expensive but you need the machines to form the plastic, you have to make the molds, then you have to have it glued together and then have it painted.

Then you have to have packaging made, cards printed then have it all shipped over.

Plus it's a company so they have to make a profit or they cant produce future items.

And of course shops have utility bills and it all adds up.

But you generally get good value for money each ship is 25%-50% of a list.

Compare that to 10 space marines for £25 thats 10% of your list at most, £22 for a captain thats 5% of your list.

Age of sigmar is even worse your looking at £5 per troop model £7 per elite model.

Which even though you have to glue it together and paint it, works out cheaper per unit for a higher quality miniature model than X-Wing.

Cheers

Baaa