Thread: The Truth about Apple's prices

Let's take the iPhone 4 for example.



Looks nice don't it?

If we take apart an iPhone 4, it costs Apple $187.51 to make it. The precious retina display costs $28 bucks and the much touted A4 processor costs $10 bucks.

The retail price for an iPhone 4 16GB is $599

that's a 220% markup.

Can you imagine what it costs them to make a Macbook?

Motherfuckers.

That means that your precious Macbook Pro 15" that you paid $1,799 for, probably cost them around $500 bucks. Hell, maybe costs them 200-300 bucks to make it.

One of the reasons why it costs bugger all to make is because they are using extremely low paid Chinese factory workers.... some of which go on to kill themselves...

11th suicide at Apple factory

I promise not to kill myself: Apple factory workers 'asked to sign pledge'

Yup, marketing hype.

Does it include the cost of developing the technology, advertising, etc?

There's more to bringing a product to market than the value of its components.

Very simplistic.
A car weights a tonnes.
Tonne of steel, dunno, 800 quid?

Originally Posted by chupacabra

The retail price for an iPhone 4 16GB is $599

A nice Nigerian chap is selling them on the internet for about $299.

Can buy in Laos.
100 quid.
Real of course.

Of course there are development costs and you have to factor in a little extra for a whole bunch of things but the majority of the profit is because Apple knows it's customers are stupid.

Originally Posted by FailSafe

Does it include the cost of developing the technology, advertising, etc?

No

Originally Posted by FailSafe

There's more to bringing a product to market than the value of its components.

Yes.

Originally Posted by chupacabra

That means that your precious Macbook Pro 15" that you paid $1,799 for, probably cost them around $500 bucks. Hell, maybe costs them 200-300 bucks to make it.

I thought the Apple logo cost at least 10,000 THB...?

Originally Posted by Marmite the Dog

I thought the Apple logo cost at least 10,000 THB...?

and also, you have to pay a certain percentage every time Steve says "Ain't that cool!".

Anybody remember the price of the first iPhone?

People flooded the stores as they are doing now and paid $599 to get it. Magically, was it 8 weeks later? , the price dropped to $399.

Furious people. Apple had to issue vouchers.

up to them

I just do not troubleshoot for them - let them ask steve

Any idea what the total overhead expense of a corporation like Apple is? I would be surprised if their gross margin on any item is more than 20%. From that subtract total operating expense and taxes. If people have a massive hard-on about Apple making a profit they should not buy their products.

Only 220% mark up? That is extremely low.

What do you think your mark up on a cup of coffee is?

Originally Posted by MeMock

What do you think your mark up on a cup of coffee is?

Starbucks or Peppers ?

Don't blame Apple, blame all the mindless lemming fans who line up in long queues to buy their phones at that price. Apple are just charging what the market is prepared to pay.Someone told me today that the new iPhone 4 was selling for Baht 50,000 at MBK, I am not sure if this is true, but if so I bet there will still be some idiots buying it.

Originally Posted by Nawty

Originally Posted by MeMock

What do you think your mark up on a cup of coffee is?

Starbucks or Peppers ?

Starbucks unfortunately

Dont buy apple products or starbucks. Ya got twins ya gotta know when to save.

Originally Posted by chupacabra

If we take apart an iPhone 4, it costs Apple $187.51 to make it. The precious retina display costs $28 bucks and the much touted A4 processor costs $10 bucks.

that must be the manufacturing cost, with the marketing and distribution, you have to double that cost, so you are talking 360 USD NET before adding "brand name" and then you have the OS and R&D, even if the R&D results are lame, it must be quite expensive.

Originally Posted by MeMock

Only 220% mark up? That is extremely low.

What do you think your mark up on a cup of coffee is?

Apple is a supplier not a retailer. Different mark-ups apply. Retail margins vary a lot by industry. Apple has some retail stores but they are mostly franchise operations. Apple does set the retail price though thereby locking in the mark-up the retailer takes.

from Yahoo Finance,

AAPL: Key Statistics for Apple Inc. - Yahoo! Finance

they have a Net Profit Margin of 20% which is quite high for a Desktop manufacturer

Operating Margin is 29% which also seem quite high in that business

Let's not reveal that the cost of a branded watch manufacturing is 20X less then the selling price!
But one add, in a glossy paper like Elle is how much ? x how many countries ? and times how many other newspaper and other glossy papers ? so on... Advertising price + before that marketing price + stock building up,all of this is investment with plans ahead...

There are people that invest and hope on return, Apple does, Steve does a good job, as soon as he quit all goes to trash...

Some people just like complaining all the time about just everything, in stead of investing for some plans...

Pay for R&D?

Are those the guys that green lighted the "let's put the antenna outside" idea?

They must be earning a TON.

just got my iphone 4 - have to say its quite nice.
Is it worth 599 USD? Dunno, dont care