Bearing prices, for shame

[Anthony Romano]

Parts are always a huge mark up since the service dept is usually a seperate 
profit center. Why are printer cables, toner cartriges, razor blades and the 
small size hardware we use so expensive? Competition is tooth and nail on 
the whole items but the compenents and peripherals are a source for some 
profit. Kind of an insight into how tight margins really are.
  Went through the phone book and called a few local bearing houses and only 
one would begrudgingly do retail. My savings was about $5 plus shipping for 
an "equivilant" bearing that proved to not be.
  Add up the cost of most YS parts and a whole engine is about three times 
the cost of a new one.  Part of it is the extra labor, packaging, support 
and inventory costs as previously noted but most of it is numbers. How many 
15.5*12W props does APC sell compare to the 16*8? You are talking about 
250,000 at your sc how many people want to take an order for 2 and how 
profitable is that?

Anthony Romano


>From: Anthony Abdullah <aabdu at sbcglobal.net>
>Reply-To: discussion at nsrca.org
>To: discussion at nsrca.org
>Subject: Bearing prices, for shame
>Date: Tue, 14 Oct 2003 13:55:52 -0700 (PDT)
>
>I work at a major industrial distributor and for some unknown reason had 
>not utilized them as a source of replacement bearings yet. A flyer at my 
>local field asked me to get replacement bearings for his OS91 VRDF and had 
>me look up the part number. I found out that for at least the OS ducted fan 
>engine they are standard NTN bearings. Tower charges 14.49 for the smaller 
>front bearing and 16.99 for the larger rear one. I looked them up in our 
>system and our cost on the front is $3.79 and the rear is $4.84! Now color 
>me silly, but I think a 251% mark up is a little excessive. If only I could 
>sell anything for that I would be flying a pattern plane made of gold.That 
>doesn't even include shipping because both would have to be shipped so 
>that's a push. Now I can see the price if the bearings are specially made 
>for our application and require seperate tooling or equipment, but we 
>bought and sold about 3.7 million of those last year for industrial 
>applications alone, and probably have about
>  250,000 on the shelves of our 650 SCs at any given time. It is obvious 
>that OS buys a standard bearing, renumbers it and sells it to us at a huge 
>profit for their troubles. Another example of the RC market being taken 
>advantage of.
>
>Moral of the story: if you can find another source of replacement bearings 
>do it. My company has service centers in 48 states and any of the friendly 
>associates could probably save you money on them. I would even be willing 
>to acquire them and ship em and I would only charge you 150% markup. <vbg>
>
>Disclaimer: I know that there are people out there who would say "what 
>about OSs cost  overhead, and razor thin margins, and blah.... blah.... 
>blah..." but I really am not concerned about that. I know it costs them X 
>dollars to do business, but my only concern is spreading the word to my 
>fellow RC enthusiasts so that we can stretch our already thin hobby dollar 
>as far as possible.
>
>

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