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What a ski costs to make

post #1 of 27
Thread Starter 

Hello all. The recent ski origins thread drifted into an interesting discussion of ski prices versus what production costs in various countries. The underlying question is whether ski makers are fleecing us by moving production to places like China.

 

OK, Quant2325 has provided a link to a good site for retail prices of ski building materials: http://www.skibuilders.com/howto/skicon/materials.shtml.

 

I've done some nosing around and found some prices for metals and carbon used in skis. 


First, it's useful to understand that Titanal is a proprietary aluminum alloy, without an ATOM of titanium in it. Formula is: 88.5% aluminum, 1.7% copper, 2.5% magnesium, 7% zinc, and .1% zirconium. Knowing this puts puts you one up on any ski magazine review section ever written, as well as a (nameless) major indie ski builder, and probably most posters here and elsewhere. It's spelled similarly as a marketing trick, folks, nothing more. 

 

But also means that it's pricier than standard alu alloy, since the maker is Austria Metall AG (AMAG), and if you use the name, you buy from them. What would be interesting would be to see if any so-called titanium skis actually have any titanium in them, or are just using aluminum alloy with a slightly different formula than Titanal. As I stated, even many people in the industry use "titanium" and "titanal" interchangeably. 

 

OK, prices: Real titanium alloys seem to retail over $140/lb, or put another way, the .5 mm sheet in a typical ski would run about $70/sq foot, which would weight about 2/3 of a lb. A single ski would have roughly 3 sq feet of metal sheet in it, so that works out to $210. I suspect if "titanium" skis like the AC50 use this metal, it's a small% of yet another alu alloy. 

 

Aerospace grade aluminum alloy in .5mm (similar to but not Titanal, couldn't find a quote on that) retails at about $7/sq foot, weighs about half what titanium alloy sheet weighs. So same size ski would have about $21 of aluminum, which fits with another estimate, in the Wall Street Journal, of Titanal adding $25-$30 per ski to production costs.

 

Unidirectional carbon fiber sheet of .5 mm thickness runs about $30/sq. foot, weighs only .16 lbs for that area. Most skis, except for Goode and DPS, do not use an entire carbon sheet across the width of the ski, but rather fiberglass with thin carbon stringers built in. Haven't found a quote for that yet, maybe someone can help. Also most carbon in skis is tri or quad, with fibers crisscrossing. Assume this is built up from very thin unidirectional sheets, but may be wrong. Glass mavens out there?

 

Obviously, the wholesale cost to ski makers would be a bit less than half of these, but my tentative conclusions: Real aerospace titanium alloy is expensive, and heavy relative to the other possible materials. (Although not if you're Volant.) I doubt titanium is used in any skis. Carbon fiber is still fairly expensive, but very light. Typical aluminum alloy, probably including Titanal, is fairly cheap, and middleweight. 

 

However, according to metalworking sites, the real issue with alloys is lamination and bonding. Alu is fairly ductile, likes to deform unless it's up against wood or glass laminates. But that's tricky because alu doesn't like to bond, requires special surface treatment after rolling, often proprietary again. Also keep in mind that alu has to be bent fairly carefully into a camber curve, or it'll kink. AMAG advertises that it shapes and bends ski metal, so I assume it may ship pre-cambered sheets. 

 

Cores, I sense, are fairly expensive because of the human labor involved in selection, fit, prior to lamination, but so far can't pin down a retail, let alone a wholesale price. Pretty specialized item. I know that PM Gear for several years got some of its cores from AK, now appears to be making all its own. So it looks like some ski makers also supply cores to a other makers. 

 

What this all means to me so far is that 1) skis made of materials other than wood and fiberglass are considerably more complicated to make. 2) These skis will have increased materials costs, but the real issue will be the expert labor needed to get the sheet metal or carbon into a ski and keep it there. And 3) as far as I can tell, most materials for a ski will come from sources other than the place that actually presses the skis, finishes them, eg, "makes" them. I'd guess that K2's "Chinese" skis have materials from all over, including Austria if they say "Titanal," and I'd guess that they are designed in the U.S. and that U.S. or European experts with a lot of previous experience oversee the tricky bits of metal or carbon prep, etc.  

 

This does not suggest so far that K2, Volkl, DPS, or others are making out like bandits...


Edited by beyond - 5/27/10 at 2:18pm
post #2 of 27

beyond,

 

Wow, you spent a lot of time researching the subject.  Thank you!  Now I know why my FIS Laser GS weighs so much (extra layer of titinal).

 

What I take from your post is that anyone can make a ski for little $ if they have glue and a press, but to make a great ski there will be difficulties like putting together the best core materials, the financial cost of the best strengthening and core materials (like wood cores and titinal sheets), figuring out how to bond it all together, etc.  So perhaps the ski industry isn't "making a killing" by producing in China, and is doing so just to survive. You make a good case for labor and rent for being the only saving for producing in China because some of the best materials come from elsewhere.   The labor cost saving could make the difference between profit and loss when including benefits like health insurance and workman's compensation.  We all would rather buy a domestically built product at a competitive price, but that is becoming a fantasy.

 

Surviving may be more difficult next season.  Today the world financial markets continue to crash, with no viable solution this time around to managing all that debt.  In the word of Martha Reeves and the Vandella's, there is "nowhere to run to, baby/nowhere to hide," except for maybe two places.  And that should be discussed in another web site.

 

Thanks again for doing all that research.

post #3 of 27

How much Titanium do you suppose is in the clothing made by Columbia? They have been calling their products 'Titanium' for years now. http://www.columbia.com/titanium-jackets-pants-fleece/search_landing_titanium,default,pg.html

 

Titanium is just the new Gold standard. Somehow it surpased Platinum in cache.

 

FWIW, titanium is a great material. I have a hard tail bike made from it. It is a bit old school now, 11 - 12 years old, but the ride is plush light and oh so cool!

post #4 of 27

A major cost in ski fabrication is the resin and labor, both of which would likely be less expensive in Asia, not to mention that the control of styrene and VOC emissions, as well as waste disposal are a non-issues there.   There is sufficient financial, and perhaps logistical incentive to motivate companies to move operations out of the EU and U.S.  This has been true for skis, as it is for nearly every consumer good we buy today.   Your concluding statement that  "This does not suggest so far that K2, Volkl, DPS, or others are making out like bandits." leaves me with the reaction,

1. profit is the only visible motive for this move, and

2. at what cost does that come?

3. what economic forces have created this Asian advantage?

 

Economic gain is the sole bottom line factor in the export of manufacturing to China.  A significant part of that economic advantage derives from the manipulation of currancy values which have been kept artificially low by tying the yuan to the dollar.   If and when this economic advantage goes away, how long do you think it will take for US and EU manufacturers to flee?

 

The manufacturers seem to have addressed quality issues for the most part, so on a personal level, that leaves me with the over-riding consideration that exporting jobs and manufacturing has left us bereft of a key element of our economy.  Ski manufacture is a very small, but symbolic part of the problem.  I have made a personal decision, that where I have a choice, I choose to buy things made locally, even where that costs a few dollars more.  I don't see it as a competitive or quality issue anymore, but rather one fundamental to our economic survival.  We don't have choices in many things we buy, but skis are still an exception.  

 

So in answer to your proposition, are manufacturers fleecing us by moving manufacturing to China?  No, they are bringing us what they perceive we want; the lowest price for quality consumer goods.  The question beyond that is, does our need for immediate gratification to purchase low-cost disposable goods come at the cost of our macro-economic well-being?  That is where I feel the answer is a clear yes, and this is the crux of a hard personal decision not to purchase Asian goods, where a choice exists. 

post #5 of 27

There's certainly more costs to consider, like GSA (General, Sales, Administrative) costs, R&D, etc - that contribute to the price of a ski.  You do bring up a good conversation though.  I think another good question is, how much does the manufacturer sell the ski to the retail store for ?  Here's a real example of retail price during the course of a season for a pair of skis I purchased recently:

 

MSRP: $900

Pre-Season, for those that wanted to order these skis and receive them as soon as they hit the shelves, people paid full MSRP of $900.

Early season retail pricing (Nov, Dec, Jan) most retail shops sell for about 80% MSRP = $699.

Mid Season ( Jan, Feb), prices beginning to reduce a bit to about $550.

Late season (March, April), prices down to about $450.

End of season (April - Summer), $250.

 

So, if the same pair of skis is selling for $250 -$900, what is the real cost?  Now, to be accurate, retailers also pay a little more for pre-season orders, and if the manufacturer has excess inventory at the end of the season, they will liquidate these to their retail partners for less.  In my example above, there is no structural change between the 2010 and 2011 model, just a slight change in top-sheet graphics.

post #6 of 27

One more comment on quality - I was talking with the CEO/Founder of a high end mountain bike company this weekend.  All their bikes are manufactured in Taiwan. (In general, high-end bikes are mfg'd in Taiwan, and mid to lower end are mostly in China).  He mentioned that the infrastructure and skill of workers (frame welders) is now better in Taiwan than in the USA.  The reason being, that there is essentially no bike manufacturing in the USA any more, other than very small quantity, custom builds.  As a country, we have lost the infrastructure and skill set to manufacture many items here.  Same probably holds true for the ski industry.  High end ski (or bike) manufacturers have their reputation to uphold, and quality from China from a high-end brand is now probably the gold standard for quality - like it or not.  I've traveled to China and other regions of the world, visiting manufacturing facilities (not ski or bike), and they do have world class facilities, automated machines and great quality control.  It's not a bunch of rural peasants working in a dimly lit building in the middle of a rice paddy.  Most of the high end facilities in China cost $10's of millions to build, with the latest automated manufacturing equipment and processes sourced from around the world.

post #7 of 27
Thread Starter 
Quote:

Originally Posted by Cirquerider View Post

 

Your concluding statement that  "This does not suggest so far that K2, Volkl, DPS, or others are making out like bandits." leaves me with the reaction,

1. profit is the only visible motive for this move, and

2. at what cost does that come?

3. what economic forces have created this Asian advantage?

So in answer to your proposition, are manufacturers fleecing us by moving manufacturing to China?  No, they are bringing us what they perceive we want; the lowest price for quality consumer goods.  The question beyond that is, does our need for immediate gratification to purchase low-cost disposable goods come at the cost of our macro-economic well-being? 

Nice points, in addition to the environmental issues. I'd only disagree about profit being the sole motive: Yes and no. Profit better be the driving force behind any business in a free market, or you don't have the business after a bit. In the case of China, I suspect it's not just about wanting to meet customer's price point expectations, but also that the costs of labor, meeting regulations etc. in Europe and the U.S. have made it nearly impossible to do that. So they move, or raise their prices and die. Whether you call that seeking profit or meeting consumer expectations, it's two sides of the same coin. 

 

For me, the issue is less about avaricious businesses (obviously there are some, and obviously they'll make as much profit in China as the market allows) than about consumers who are addicted to relatively cheap, relatively high quality goods and services. We take it as our birthright ("life, liberty, and the pursuit of happiness") to have an ever better standard of living that rests of these cheap goods and services. Until Americans are willing to pay what Europeans do at the gas pump, for instance, and trade in our 5,000 lb SUV's, or cheefully live in condos with the square footage of an average Frenchman or German, or happily shell out more for food at the market or dinner at the restaurant (both supported by cheap immigrant labor), I don't have a lot of sympathy for complaints about our jobs leaving us. We've brought a lot of this on ourselves. As, have the French and Germans, even with their simpler lifestyles, because of their greater expectations about social services. And ironically, as will the Chinese, who also want more of the pie. Checked out the cost of Japanese goods these days? But yeah, I try to by American whenever I can, even if it costs a bit more. But I'm not gonna give up my god given pursuit of skiing to do it. 

 


 

Quote:
Originally Posted by ILOJ View Post

There's certainly more costs to consider, like GSA (General, Sales, Administrative) costs, R&D, etc - that contribute to the price of a ski.  You do bring up a good conversation though.  I think another good question is, how much does the manufacturer sell the ski to the retail store for ?  Here's a real example of retail price during the course of a season for a pair of skis I purchased recently:

 

MSRP: $900

Pre-Season, for those that wanted to order these skis and receive them as soon as they hit the shelves, people paid full MSRP of $900.

Early season retail pricing (Nov, Dec, Jan) most retail shops sell for about 80% MSRP = $699.

Mid Season ( Jan, Feb), prices beginning to reduce a bit to about $550.

Late season (March, April), prices down to about $450.

End of season (April - Summer), $250.

 

So, if the same pair of skis is selling for $250 -$900, what is the real cost?  Now, to be accurate, retailers also pay a little more for pre-season orders, and if the manufacturer has excess inventory at the end of the season, they will liquidate these to their retail partners for less.  In my example above, there is no structural change between the 2010 and 2011 model, just a slight change in top-sheet graphics.

You need a reply from one of our industry folks. There was a thread on this, I recall. I'd guess that the initial price includes an estimate of how may skis will end up selling in the spring at less than half that. Eg, demand changes.

 

And you pay extra for being first at your mountain with the new 2.75 XXL IQM Megasonic Complex Camber Game Changers. What you gain from being asked about them on the chair is called symbolic capital.  What you lose by not being able to justify buying two other pair for the same price in the spring is called opportunity cost. 

 

I also think that the $250 number you cite (Tram, Level 9 etc.) are for older closeout "new" models that were overproduced to begin with (no accident it's always Head and Dynastar that have all the bargains), and have depreciated each year by 10-20%. Or sometimes you'll see those prices from a smaller store that can't afford to carry inventory. Finally, suspect that companies have to spread their R&D costs over several years, so the no-change 2010-2011 models are still paying off the big design change in 2009, and hopefully, even making a little profit. For the 2012 design change...So I understand the frustration, but I don't buy the argument that it's the makers getting rich.

Quote:

Originally Posted by ILOJ View Post
 He mentioned that the infrastructure and skill of workers (frame welders) is now better in Taiwan than in the USA.  The reason being, that there is essentially no bike manufacturing in the USA any more, other than very small quantity, custom builds.  As a country, we have lost the infrastructure and skill set to manufacture many items here.  Same probably holds true for the ski industry... I've traveled to China and other regions of the world, visiting manufacturing facilities (not ski or bike), and they do have world class facilities, automated machines and great quality control.  It's not a bunch of rural peasants working in a dimly lit building in the middle of a rice paddy.  Most of the high end facilities in China cost $10's of millions to build, with the latest automated manufacturing equipment and processes sourced from around the world.

The first part makes sense; have heard the same complaint about U.S. competitiveness in general; loss of infrastructure and skilled labor. Of course, you could argue that starts with jobs fleeing...

 

Second part has been my experience too. Funny how the TV reports on tainted pharms etc. always show these revolting looking hovels where the ingredients are being produced, but the factories I've seen are more modern than comparable in U.S. Probably both worlds exist there. It's a wild place. 
 

post #8 of 27

I've worked part time in a few ski shops and from what I can see, when the skis go on sale at 40% off in March , the shops are already loosing money. They make much better margins in clothing, ski rentals, ski tuning. I think even the boots do better for the shop than skis.

post #9 of 27

You mean Titanal is not the same as "Tit Anal?"

A bit of space in between shouldn't make that much difference. 

post #10 of 27

Years ago I had the opportunity to work for a smaller private corporation (about $200 million annual sales). The founder was very much involved with operations at that time (was president of the corp). I was in a position of sitting on the "pricing committee" that committee's function was establishing the selling prices (MSRP if you will) for the company's products.

When I was appointed to this committee, I remember the President talking to me about the goals and methods he believed in. One comment he made was "Costing is a Science, Pricing is a Art" both must be used to result in profitable products for the company.

Things change, the founder has sold to company, he is still living (@ 100 yrs of age). I am retired from that company, (but still skiing). Some things remain though, that corporation is still in business (although wholely owned by Berkshiire-Hathaway) and still making a good profit. I still talk to the founder about once or twice per year and enjoy his insight on life.

 

Nothing to do with skiing in this post - just commenting on a cost-price relationship of manufactured products to result in a profit.

post #11 of 27

http://snowboardmaterials.com/pages/Ski%20Materials.htm  

 

The guys at snowboardmaterials.com sell maple and poplar cores.  They even market a turn-key "factory" for $18,500.  I imagine you could build a press yourself and the cost would be much lower.  The sunk cost for building a ski or snowboard isn't  much, so it must be the huge labor savings that is driving others overseas.

post #12 of 27
Thread Starter 

Another great link, Quant. Surprised how cheap cores are. OK, so looks like for retail, pair of poplar core skis with one alu sheet and basic black sintered bases, topsheet with a design, should run about like this (rounded to nearest 50 cents):

 

Core - $25

Edges - $18

Base - $25

Topsheet - $42

Damping foil - $6.50

Fiberglass - $15

Resin - $29

Single sheet of alu - $21

 

That's $181.50 for the pair. 

 

Price would be 12% lower, about $160, if you used triax fiberglass/carbon stringers instead of alu, and over 50% higher ($350) if you used true titanium alloy. 

 

This is all retail. Rule of thumb markup from wholesale to retail is 2 x ( materials+labor+capital investment+ancillary costs). We assume a decent initial profit margin of say 10% for the manufacturer, also assume that the capital investment to make skis is initially high (buying ski presses, training workers etc), and that thereafter labor is held artificially low for an indie (week's worth of pizza and beer for buddies, you get partially eaten pieces and stale beer), but can get pretty high for skilled workers in say Germany ($25-35/hr+ serious benefits). Not to mention robots.

 

For those of you who haven't bothered do the math yet (that tends to happen with marriage and children), serious benefits (retirement investment vehicle, health, paid vacations, dental, child care tax shelters etc) can add on up to another third of what your paycheck's worth. Europe has serious benefits and serious unions. We have middling benefits and weak union coverage. China has poor benefits and unions that are orchestrated by the central government. Recent signals suggest a change, however, thus skyrocketing average wages for skilled workers. (So much for the peasant with the conical hat bent over the rice paddy stereotype.)

 

So I'd guess that figuring in economies of scale and larger wholesale orders, a major could make a nice metal ski for $80-100 per ski pair in materials. I'm now officially way over my head in the business side of things, so hopefully someone who knows that arena will fill in the blanks for marketing, keeping the presses running, property taxes, facility rental, sales and distribution, but a couple of things stand out to my insanely rough estimate.

 

1) If you can buy a new ski retail in the fall for $800 (MSRP $995), it probably cost the store $300-$350 to buy wholesale, and the company $250-$300 or so to design, make, store, sell, and ship. Of that $250-300, about a third might be actual materials, and I bet most of the rest is labor, insurance, taxes, and benefits. Don't have the skill to figure amortizing industrial equipment, making molds etc.but I've read that one way Dynastar, Volkl, and others recover initial outlays is by using the same molds, basic setups, for years. Only the name and topsheet changes. Also no knowledge of advertising costs, but obviously some (K2 for instance) spend a lot more than others (Elan, for instance). Also would guess that rental fleets of intermediate skis are cheaper for makers than higher end skis, largely because the intermediate models don't change design as often, but OTOH, stores probably get them at a deeper discount. Maybe a wash? Anyone want to school me through here?

 

What I'd also love to know is whether the big price differentials of models (eg, high end vs. game improvement) is really reflected in the production costs. I'd bet that makers have a very thin margin on game improvement models, try to make up for it on the higher end. In that sense, the more uniform pricing of indies and botiques may better reflect actual production costs. But notice that most indies/botiques do not bother to make different "levels" of ski anyway, perhaps at most play around with stiffness. 

 

2) Remember that we often are predisposed toward companies that also support racers, little league/soccer teams, charities, and wet T-contests at cheap demo days. Gives them visibility, makes them into good guys. But that all comes out of the initial profits from selling the skis to the retailers. So that 10-12% initial profit margin is probably down to a few % by the end of the season.

 

3) So back to the initial point. I fail to see evidence that ski makers are getting rich at our expense. IMO, more like they're finding lower labor markets to survive at the pricepoint we all want, or demand falls. Witness all the negative $$ valence around Kastle, which retails about $200 per pair of skis more than its large competitors, and the same to $100 more than some better indies. That's 20 lunches at a coffee shop, or dinner for you and your significant other at a decent restaurant with a fairly modest wine. But we're used to skis costing 3 digits, not 4, so that $200 makes them "premium." No, "premium" is a Bugatti Veyron for your garage. Or that set of $20,000 speakers you must have to survive. 

 

4) If you can buy the same ski for $400 in the early spring, the store is breaking even, more or less, no serious profit but turning over old inventory and paying for lightbulbs and the staff. If it charges that all season long, it doesn't need to worry about the lightbulbs actually, because it'll have insufficient profits to invest in new inventory, so a convenience store will be in its place by next snowfall. 64 oz Slurpee, anyone?

 

5) If you can buy the same ski for $250 on Tram a year later, they're the only ones making money. The store had to recover something, so it sold the old/new skis to a wholesaler. (For well under $250, since that represents retail for an online store.) Or (over my head again) perhaps the store just ate the bullet and sold below cost in that rack for closeouts, and Tram's skis all come from poorly planned company production runs. Either way, both company and store are losers here. So for whom is the $250 a fair price?

 

The answer is me, if I'm the one buying the ski. 


Edited by beyond - 5/27/10 at 5:48pm
post #13 of 27

Manufacturers would be buying mats at an immense bulk discount....the mats are the same (for the most part) year after year, so they can be stored and little goes to waste.  The little manufacturing a company I owned did, showed me just how much the prices of materials and production drop when bought in bulk and more importantly on a regular basis, and I was manufacturing in the USA and Canada, one of my bidders wanted to manufacture some components for me in China and said it would cost me 1/4 of the price it did here even after shipping....I did not bite.

post #14 of 27


 

Quote:
Originally Posted by beyond View Post


What I'd also love to know is whether the big price differentials of models (eg, high end vs. game improvement) is really reflected in the production costs.


No.

 

SJ

post #15 of 27

If I recall correctlty...it was a long time ago....but back in 1993 Fisher RC4s cost Fisher $21/pair to make (I worked for Fisher).  That was one of the most expensive skis produced, or so I was told.  Salomon just started with their monocoque skis...they were $6 pair (My gf's father at the time worked for Salomon).

 

Increase that into todays dollars, and add a good 30%? (guess) premium for the fancy materials used today.....of course I could be way out.  Need to consider what they count in that cost...is it incremental cost, (ie just material and labour), or the cost of R&D, Advertising, Plant and Equipment, Overheads etc etc.....

post #16 of 27
Thread Starter 

For those interested in all that exploited crappy labor in China, suggest reading this article about a strike Honda is having in its Chinese factory:http://www.nytimes.com/2010/05/28/business/global/28honda.html?hp

post #17 of 27

I'm not sure how much any of you have been following the saga of 333 Skis, but Michael Lish posts his costing info frequently.

 

Here's one of his posts from the 333 Skis thread at AlpineZone.com:

 

"

The cost of 333 skis $333

I'll give you a quick break down on the costs associated with skis.

The best materials package for nearly all ski companies is between $38 to $54 dollars US. I use a birch wood core, sintered 2000 , knitted fiberglass in tria axial and double bias, rockwell 52 edge stock, and formulated resin. My package is around $42 per set of skis.I have eliminated many of the costs associated with doing business, Factory, Advertising, re shipment from China (K2), Reps, and the graphics for the ski. I do not stock skis and my re order on material is quick so inventory is low. I build skis for a wage, not profit. At $333 per set, less car insurance for the tow truck, and the 12 oz of fuel to build the ski, a few tools that get upgraded, the cost for materials and up keep, I make as much as a bad layer per hour.

I've been in the industry for over 20 years innovating to stream line production. The trailered factory, parked out back, fast track jigs, a keen mind for off the shelf materials which can cut costs dramatically and a sense of fairness in pricing keeps the product priced for a working persons wage.

Hey, I eat better now, build a kill set of skis, have a view when I work, ski a heck of a lot, and love what I do.

Michael
333"
 
 
This guy is actually pretty nutty and he totally blew it when he went off on the TGR crowd.  In my estimation that customer base was one of his best bets to really get his custom ski building business off the ground, but he couldn't handle the demand.
post #18 of 27
Thread Starter 

^^^^^Yep, I've been following; real hoot. Not only failed from alienating TGR (which as Noodler says is perfect for viral marketing) with failed deliveries followed by belligerence, but his web site morphed from libertarian-live-off-radar into Beam-Me-Up-Scotty monologues. It's worth a visit just to see how easy the web makes it to suck people's $$ into shared fantasies. 

 

As far as his costs figures, $42 seems pretty low to me, 1/4 of retail. Possible maybe if you buy big bulk orders of materials under contract with main suppliers. He doesn't seem like the kinda guy who'd inspire confidence in a supplier, though. His skis appeared to have a "natural" topsheet, so saved some money there. The retail OTOH seems a touch high (790% markup ) given that he only ended up making a handful of skis in a trailer, had a girlfriend for a "tester" and from the look of him skiing his product (be sure to check out the photos), didn't waste anything on lessons. Maybe he was trying to pay off his factory up front...

 

For a look at how the vision of custom skis can work, suggest here: http://www.folsomcustomskis.com/


Edited by beyond - 5/28/10 at 2:54pm
post #19 of 27

Skis, just like any other commercially produced product, have a huge markup. Buying materials in bulk saves a ton of money, at my worst I was spending around $250/pair and at my best half that, and that is turning out 5 pairs a year. That doesn't factor in advertising, tooling, rent etc.

 

While Lish has some interesting and potentially valid manufacturing concepts, 333 skis are really a joke in terms of quality and professionalism. There's really not a lot to say here, just take a look at his site, read how things have gone down at TGR (a lot of valuable info has disappeared from the 333 site in response to criticism) and make your own judgments.

 

Custom skis don,t have to cost $1200. But when you see a pair of Atomics in the shop with an MSRP of $1500 that aren't quite what you want, spending $300 less and getting custom bling sure seems like a good idea.

post #20 of 27

Noodler,

 

I've been following the Lish/333 Ski saga for a while simply because he is likely onto something, although I have concerns since there aren't many reviews on his skis posted anywhere.  No doubt he can build skis in a "green" way out of his trailer parked in the desert, and soon to be parked I guess in East LA.  But...are the skis just mediocre or are they really good?

 

Using a plywood core may work, but is it as good as the laminated wood cores HEAD, Atomic, Stockli, etc. put in their skis?  Using an adjustable mold that can be modified for any size ski is really cool, but can he get the flex and torsion that change with the length of the ski as good as the majors?  The bigger companies have computerized equipment to flex skis before matching them in pairs.  How close are his tolerances with each pair using plywood?  Something tells me, and I can't back this up with data, that 90% of building a ski can easily be done by anyone, but the last 10% is difficult to copy.  And the last 10%, of course, might make the difference between a great ski and a crappy one.
 

I would love to have those answers.  If the tolerances don't matter much for a powder only ski, I'd order one from him in a heartbeat and design some sort of custom top that would make me smile every time I use them.  If tight tolerances do matter, I'd rather he only built a few models that work great instead of picking from an unlimited number of designs.  And I'd love to see him use the very best materials for a 444 ($444) Ski.  Tolerances and materials used in snowboards probably don't matter too much, but they have to be critical with performance skis.

 

Michael Lish is certainly a maverick...a true pioneer who wants to change the way people think about skis and skiing.  I'd rather change the business model to having all materials precut for 5 or 6 great skiing models stocked in one central location, with independently operated ski builders in every ski town using his or another press and grinding machine.  The ski builders in each town could have their shops on Main Street,  in a ski area parking lot, in a flea market or wherever.  When someone wants a "custom" ski, the customer can order one of the 5 or 6 great skiing models with a custom top, core, flex and top (knowing the basic ski design is a winner).  The local ski builder layers it all together with the customer (if the customer wants to "build" his own ski), and provides a custom grind and tune.  The ski builder orders materials when he needs them from the supplier, cutting down on inventory.  But will this model be profitable?  Will their be enough demand from skiers?

 

Anyhow, Lish certainly improved his website and is sticking to his ideals.  Good for him.
 

Quote:
Originally Posted by Noodler View Post

I'm not sure how much any of you have been following the saga of 333 Skis, but Michael Lish posts his costing info frequently.

 

Here's one of his posts from the 333 Skis thread at AlpineZone.com:

 

"

The cost of 333 skis $333

I'll give you a quick break down on the costs associated with skis.

The best materials package for nearly all ski companies is between $38 to $54 dollars US. I use a birch wood core, sintered 2000 , knitted fiberglass in tria axial and double bias, rockwell 52 edge stock, and formulated resin. My package is around $42 per set of skis.I have eliminated many of the costs associated with doing business, Factory, Advertising, re shipment from China (K2), Reps, and the graphics for the ski. I do not stock skis and my re order on material is quick so inventory is low. I build skis for a wage, not profit. At $333 per set, less car insurance for the tow truck, and the 12 oz of fuel to build the ski, a few tools that get upgraded, the cost for materials and up keep, I make as much as a bad layer per hour.

I've been in the industry for over 20 years innovating to stream line production. The trailered factory, parked out back, fast track jigs, a keen mind for off the shelf materials which can cut costs dramatically and a sense of fairness in pricing keeps the product priced for a working persons wage.

Hey, I eat better now, build a kill set of skis, have a view when I work, ski a heck of a lot, and love what I do.

Michael
333"
 
 
This guy is actually pretty nutty and he totally blew it when he went off on the TGR crowd.  In my estimation that customer base was one of his best bets to really get his custom ski building business off the ground, but he couldn't handle the demand.
post #21 of 27

I really don't understand this thread.

 

post #22 of 27
Thread Starter 
Quote:
Originally Posted by Whiteroom View Post

I really don't understand this thread.

 


Not sure I do either and I started it. 

 

Hey, my only alternative by Memorial Day is actual work

post #23 of 27

So far my favorite bit is:

 

from 333- "my package is around $42 per set of skis... I build skis for a wage, not profit*. At $333..."

 

wwwhhaaaattt?????

 

I think my small intestine tried to crawl up my neck to strangle my brain stem while I was reading that.

 

$333 - $42 = $291.   $291 / $42 = 6.93... a 700% mark-up. Just how long does it take him to build a pair of skis? 10 hours seems like a preposterously long time to assemble 2 skis... that would be a 'wage' of $29.00 per hr, where do I sign up?

 

"...If it weren't for that horse, I'd have never spent a year at college." (thanks Josh)

 

his cost is 42, somewhere Douglas Adams is smiling down at me... and a small 'Lewis Black' shaped tumor has formed in my cerebral cortex.

 

Thanks for that.

 

 

 

 

* he works for a wage... well duh, what would he do with all the underpants if he was working for 'profit'??? (profit-http://en.wikipedia.org/wiki/Gnomes_%28South_Park%29)

 


Edited by Whiteroom - 5/30/10 at 10:24am
post #24 of 27
Thread Starter 
Quote:
Originally Posted by Whiteroom View Post

his cost is 42, somewhere Douglas Adams is smiling down at me... 


Missed that first read.

post #25 of 27
Thread Starter 

Incidentally, the cost of making skis in China appears to be going up next season: http://www.nytimes.com/2010/06/11/business/global/11strike.html?hp

post #26 of 27

I'm enjoying it too on a damp Saturday afternoon. After 10+ pints last night...

 

I'm looking for my next pair of skis - for skiing PNW (Whistler/Blackcomb). I currently ski a Head Peak 78, 177cm. I live in Toronto so it's a great ski to use out West (although is one of the skinnier ones I saw last year) but is still manageable and fun out here.

 

Last winter, I saw Whistler in high-pressure and low-pressure conditions in two one week trips. Started my season first week of December, it was bluebird but frigid. Not one day of snow. The Peak's were great on those conditions. If I lived out West, I would probably have the Peak 88 instead as an everyday ski.

 

Second trip was the opposite. Five days of skiing -- 2 days 20cm, 2 days 30cm-40cm, 1 day 50cm+, all at Pig Alley. Ruby bowl was over a meter of fresh on the final day. With another two trips planned again this year, I really want to have a powder ski for when I run into those low-pressure conditions again -- great excuse wot? 

 

I am thinking to go with one of the BC-based manufacturers. I'm liking the idea of having a "craft" ski. The ON3P models look "tuned" for a slightly different type of skiing. I like the idea of trying a ski that was made in/near where I'll be using them primarily. 

 

Now, I'm thinking about heading to Whistler a day early to visit the Prior factory -- and pick up my new Overlords!  Or a pair of BSI Ullr's...

 

Greg

post #27 of 27

You can't just look at a company's cost per unit of raw materials & labor and say geez look at the MSRP markup.   In some industries/situations you have to consider Cost of Sales, Insurance and Transportation, and delivery costs before title transfer occurs and revenue can be recognized.  This just derives the COGS, which allows you to back into the CM or the Revenue - Marginal Cost to produce the item.

 

Capital intensive businesses also have significant depr/amort costs that are spread out over time.  You must also factor in G&A costs (GM, Quality, Finance, HR, Legal), import duties/VAT, Cost of Financing (int expense), Marketing & Advertising, R&D, Overhead (facility,utility, property tax) before you get to OM.  Finally Corp Inc tax can take away as much as 35% of your profits in US over 50%+ in other countries.

 

I'm sure many of these manufacturers are struggling to make significant profits in the current economic environment.  Sure the cost of labor in china + scale of operations/efficiency has helped companies to increase their margins.  But over time competetive pressures will erode this as most all companies will utilize the same strategy.  The skiing industry is tough as it's competitive landscape is high and the volume growth going forward is low/fixed.   Downward pricing pressure for equipment will also detract from economic opportunities of new companies entering the market.
 

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