folkdeejay wrote:

Thanks for your kind words guys.... 😜 kind of playing devils advocate, but I just don't subscribe to the elitist, price-determines-quality ethos behind many of the posts.

I do accept there are issues to do with labour rights and T&C's in many Eastern facilities - but as per my earlier posts, the West does not have a glorious past in this respect either - and in many respects, they only way forward for "emerging markets" is to drive up standards by working with them....slow and less than ideal as it might be.

Right - I've had my say now.

 

good stuff - made a lot of sense

Chris wrote:

Rolex are a top brand, and they seem to make money(not profit apparently). It's either their Chinese parts offshoot, or it's the low labour costs of the Democratic Workers Collective that is Switzerland👍. Neither i suspect. But they do charge alot of money and seem to sell alot of watches.

 

As Rolex don't show any figures about watches sold, profits or even turnover it's hard to say.

However, they do make a healty profit, but Rolex is not a company per se, it's a foundation, or trust. Hence they can be so secretive.

They send about 600.000 - 700.000 watches a year to COSC, to have them chronometer certified. This is the only indication as to how many watches they are actually selling. As most Rolex's are chronometer grade, the estimate is about 700 thousand watches sold each year.

But the major difference between Rolex and B&O is (manufacturing and outsourcing not included) B&O makes consumer electronics, which have a very short lifespan. Rolex makes watches. Rolex are a very slow evolving company in terms of design. The oyster case has looked the same for over 50 years. Only recently have the introduction of the "super case" essentially the same oyster case, only a bit beefier, but in most models, the same 40mm case diameter has been kept.

A 15 year old TV from B&O is going to be looked at as something old and strange by 99% of people today, while a 15 year old properly maintained Rolex will be the envy of 99% of your friends.

A 50 year old Stereo system from B&O might barely work, and be chop-wood while the 50 year old Rolex Submariner or Milgauss, may get you a new Ferrari if you choose to sell it.

Rolex are experst at marketing, something B&O are not. Rolex don't post a video where the SELF LOVING CEO, speaks in a very strong accent, and pronouces "Bang & Olufsen" in the proper Danish way, but for many becomes an incomprehensible word. To me it looks like "Tue" tries to copy Steve Jobs with these appearances in videos to the public.

I would love to see B&O production stay in Denmark, and the prices they charge, I'm hard pressed to see why it wouldn't be possible even with the high cost of workforce. Maybe not for the ipod docks, but surely the BV10, BL5's etc?

What I would like to see is the cost structure of the labour in B&O. How expensive is the top  of the company, and how big is it? There's 2500 employees. 

B&O annual revenue per worker is about 244.000 euros

Apple annual revenue per worker is about 1.500.000 euros

Nokia annual revenue per worker is about 320.000 euros

Microsoft annual revenue per worker is about 586.000 euros

Nokia is known to have a very dated, and complex hierarcy. That's a big reason to the problems they are facing.

Puncher wrote:

Dkatz wrote:

I am not comparing Chinese to Nazi's but am just saying that we all have a choice, we can buy products of inferior quality made by cheap labour if we want or we can choose not to.

 I'm afraid your your lengthy replies are somewhat devalued by your refusal to accept than China can produce high quality goods. If the goods received are inferior then the sourcing company is at fault for selecting the wrong supplier.

And, as I said above (my reply went in to moderation, so may have been missed), the Beosound 8 and Beolit 12 are two successful B&O products. Dkatz is trying to fuel an argument over a non-issue.

If, in 6 months, the Beolit 12's are falling apart or appear to be sub-standard, then let's reopen this debate. However, my Beosound 8 is one of the best B&O products I own. Indeed, for the price, it's arguably the best. I have zero complaints about its functionality, design, build quality or longevity. Ok, if the thing falls apart in a couple of years, fair enough - at that price I'd be happy to look at upgrading or moving up to a newer model.

The irony of this argument is that B&O are now producing products we can all afford, look good, well built and perform superbly. Which is why Beosound 8 sales hit and exceeded 50,000 units.

How would the product be "improved" by moving manufacturing back to Denmark (considering most B&O manufacturing is done in the Czech Republic, we seem to constantly overlook this point...)? Costs may or may not go up, but I bet B&O couldn't meet the 50,000 production levels required to meet that demand. And that's a reason they moved to China, as they have the capabilities of producing more mass market products, which B&O need to meet the stock level demand required by the Apple Stores.

 Ah DJ, this takes me back to yesteryear when we spent many happy hours supping coffee in King Street and putting the world to rights.

I think you hit the nail on the head when you said the world has changed. There is no argument with that andif Bang & Olufsen are to continue, they must also change.

Opman

Shhh - you'll blow my cover 😕

And mine ha ha

Looks like I need to catch up a bit with this thread! I agree totally with Dkatz, manufacturers are constantly perusing a profit over quality. I liked the Dyson example, still the same price as they were made here, obviously making much more of a mark up.

I don't agree that China has skilled workers, there is no skill in assembling a product such as a laptop. Rolls Royce aero plane engines or Rolex watches are however built by skilled workers in Europe!

I think a lot about it is a brands reputation, I'll go back to my example of Miele. They have never outsourced, and are still made in Germany, a very high labour cost country, probably not outsourcing as they can keep a tight grip on quality control. Yet they have a reputation of being the best, and had the best financial performance ever as a company in 2010, so people must be buying what are expensive and rather luxury items. 

folkdeejay wrote:

Dkatz - with respect, I feel you are missing point, based on a "rose-tinted" view of the reality of the heritage of B&O, its actual trading history and where many employees and dealers would see the brand over the last 80 years.

Prior to the panel TV range, B&O made CRT for decades.  These CRT models were, without doubt, just about the best pictures in the world.  Early on, B&O made TV's in lovely wooden cabinets (as was the norm, later on some plastics were used - although the Avant/BV5 cabinets were, interestingly, made by the same family owned sub-supplier that made many of the early , iconic wooden TV cabinets).  But these plastics were finished to a high standard, in a range of colours.  No one else did this.

The point here is, these class-leading TV's retailed at a factor of 2 or 3 times the price of the branded "high street" brands such a Pana's Quintrix,  or Sony's Trinitron etc etc  They were never like Aston Martin, when the classic vintage cars were always a multiple of x10 or more above a Ford.

B&O was an aspirational brand, for sure - but it was not a brand only for the super rich.  I guess a 1960's Aston Martin  DB-whatever would not typically have been bought by a teacher, a kitchen salesperson or a local council officer.  In my family, B&O items were bought in that decade, by those tradespeople.

@ folkdeejay

I'm sorry to 'rain on your parade' fella, but I'm going to have to correct you (and all those that have been piling in to agree with you, puncher, nickyg63, joeyboygolf etc.) - due to the plain fact that you are one who is incorrect.

And here is why :-

Back in September 1966 my Mother & Father bought their first house together, prior to getting married in March 1967. The house was a stone built property called 'The Manse' with 3 bedrooms. The price they paid for it was £1,550 (in Sept '66).

The Bang & Olufsen television of that time was the Beovision 3000. Please see the following link to Beocentral.com

link

Scroll to the foot of the page and you can see that (according to Beocentral) the list/retail price of this set in 1969 was 398 Guineas.

1 Guinea was equal to £1 + 1shilling.  Therefore 398 Guineas was a little over £400.

This means that to buy a Beovision 3000 in 1969 was the equivalent of over 25% of the cost of my parents first house.

This same property in todays terms would be priced somewhere between £160,000 - £180,000 (even in the current depressed property market).

25% of lets say £170,000 is £42,500   This, in relative terms, is what buying a Beovision 3000 would have cost in todays prices.

As a further illustration of this, back in 1968/69 tax year, my mother was a newly qualified teacher. (She still has her payslips from the time & I have seen them.) Her net monthly pay in '68/69 as a newly qualified teacher was £54 per month. This meant that to buy the Beovision 3000 would have cost 8 months of net salary.

The net salary of a newly qualified teacher today is somewhere in region of £1,500 per month. Therefore, 8 months of £1,500 would be £12,000. Although B&O do still make TV's costing this and more, the latest additions to the range are, without doubt, heading decidely downmarket.....You are trying to make out that B&O are not heading 'downwards' in terms of product affordability - quite simply this is wrong.

I have asked my mother what she would have thought about spending 398 Guineas on a Television in 1969. After she had picked herself up off the floor, she said that spending 8 months salary or 25% of their property value on a television set would have been absolutely and completely 'out of the question!'. Not suprisingly. 

So, i'm afraid that your claim that B&O having never been beyond the reaches of 'ordinary people' is, quite simply, incorrect. 

Bang and Olufsen have historically always been a brand that only the rich or 'very comfortably off' could afford easily. More middle earning people could, if they wanted B&O very much, save up for some months or even years in order to buy B&O. Today, with B&O's 'Play' range of products priced at £500-£1,000, your average bank clerk, supermarket cashier, factory worker (i.e. unskilled/semi skilled worker) can fairly easily afford a BS8 or Beolit 12 and the like. Quite possibly someone on a very modest £15k to £25k salary are able to afford one out of a single months wages (or maybe a couple of months wages perhaps).

folkdeejay wrote:

folkdeejay : "You have, imo, missunderstood what/where B&O has been historically within the audio/video world, and so the repeated assertion that they are betraying their heritage is simply wrong."

I'm afraid not my friend. The facts speak for themselves, and when the real facts are considered, (as opposed to your own opinions and your own historical 'recollections'  you are in fact the one who has 'misunderstood what/where B&O has been historically within the audio/video world'.

🙂

All televisions were expensive in 1969, they were still recent technology. I know 'cos I was there "fella".

Not as expensive as B&O, I'll grant you. However, they were expensive enough to mean that most people rented and very few were purchased outright.

p.s. I could argue my case properly if only this bloody forum would let me post a longer reply!!!!!!!!!!!!!!!

adamhornsby wrote:

Looks like I need to catch up a bit with this thread! I agree totally with Dkatz, manufacturers are constantly perusing a profit over quality. I liked the Dyson example, still the same price as they were made here, obviously making much more of a mark up.

I don't agree that China has skilled workers, there is no skill in assembling a product such as a laptop. Rolls Royce aero plane engines or Rolex watches are however built by skilled workers in Europe!

I think a lot about it is a brands reputation, I'll go back to my example of Miele. They have never outsourced, and are still made in Germany, a very high labour cost country, probably not outsourcing as they can keep a tight grip on quality control. Yet they have a reputation of being the best, and had the best financial performance ever as a company in 2010, so people must be buying what are expensive and rather luxury items. 

 

You might want to leave Rolls Royce out of this discussion because not all RR aero engines are made in the UK.  The new RR Trent 1000 is also being assembled in Singapore.  If you look at the Rolls Royce homepage, you will notice it really is an international company with manufacturing plants and workers all over the world.  Roll Royce automobiles are made in Britain but is owned by a BMW who really make all the decisions and collect the profits.

Great discussion though.