8 ms·
The seeming ridiculousness of the price difference is another way of looking at how hyper-efficient modern mass manufacturing is. Their original cost for that
by ethbr0 5y ago
The seeming ridiculousness of the price difference is another way of looking at how hyper-efficient modern mass manufacturing is.
Their original cost for that part is miniscule. BUT! That's the cost of that part, being delivered to the assembly line, in bulk quantities, at a regular, predictable order cadence from the upstream supplier, over an unchanging delivery route, with minimal inventory kept on hand. Essentially, everything they can do to reduce the cost.
None of those things are true for a replacement part you order. It's an entirely different logistics chain, with entirely different costs.
- brtkdotse 5y ago> The seeming ridiculousness of the price difference is another way of looking at how hyper-efficient modern mass manufacturing is. Reminds me of the Planet Money multipart story where they made a tshirt, from scratch. Bought cotton from a farmer, shipped it to a textile industry, contacted a tshirt making company, shipped it to the US. The bulk of the cost in the end came from transporting the tshirt from the harbor to the store where it was sold.
- ClumsyPilot 5y ago> That's the cost of that part, being delivered to the assembly line, in bulk quantities, at a regular, predictable order cadence from the upstream supplier I am not buting this reasoning - the assebly line costs money to run, worker's time and salaries need to be paid, quality control and warranty to be done. A part sold by itself needs none of those things. While you are taling to me about how difficult logistics of a $200 part justifies a 500% markup, i can buy a $3 led from China with free shipping. This doesnt add up
- judge2020 5y agoThis is generally because USPS effectively subsidizes international shipment. The same $2 LED shipment might be $10 DHL (and free shipping isn’t free, the seller is making their margins with shipping costs included).
- adhesive_wombat 5y agoSo you allow the manufacturer to charge for delivery (based, on, say, some average delivery cost for the weight, rather then allowing inflated S&H costs to be a new profit centre rewarding unreliable items). Or, if you really want to stamp down about it, you do not allow them to recoup delivery costs and that's their punishment for making an unreliable machine in the first place.
- rootsudo 5y agoYes, and in your perfect world - manufacturers know full in advance about part life? There are hundreds of parts that make up the build of material of an appliance. This means simply that parts won't ship and service is only done at approved manufacturer facilities. OH wait...
- rootsudo 5y agoNot anymore, Trump modified the EMS packet from china to USA thing to remove subsidies. https://www.theatlantic.com/technology/archive/2018/10/trump-changes-terminal-dues-and-epacket-rates/573337/ https://www.theatlantic.com/technology/archive/2018/10/trump... This was 2018.
- deleted 5y ago[deleted]
- ethbr0 5y agoThat assembly line's costs are amortized over the rate of production (high): that's the essence of mass manufacturing. > A part sold by itself needs none of those things. A part sold by itself needs so many more things! Where do you store it? How do you organize it there? How do you keep track of your inventory? How do you re-order new inventory? How much do you re-order? How long do you typically have to store? How do you source substitute suppliers when your original goes out of business? How do you QC stock? Etc. Etc. All of that for multiples of the part count that goes into a single model, because you sell more than one model. You can buy a $3 LED from China (see sibling comment for economics on free shipping) because you're buying the current model / whatever version they feel like giving you. "Part specs may be subject to variation" doesn't work so well with more complex systems.
- withinboredom 5y agoWow, no one says you have to get a spare part to a customer tomorrow morning. Just grab one before it goes to assembly line, ship it with the actual completed machines to a distribution center where it will go to the customer from there. There's nothing "new," except at the beginning/end of the chain, just add a few more of those parts to the next order of them. If it will impact operations to take a few from the beginning, some of those spares will have to be delayed. That's ok, tell the customer 6-8 weeks to deliver a spare part. That was pretty standard shipping times when I was younger.
- ethbr0 5y ago> Just grab one before it goes to assembly line, ship it with the actual completed machines to a distribution center So customers can only order replacement parts while assembly lines are currently doing production runs?
- rootsudo 5y agoWhat if it's no longer being manufactured or on assembly line? HOw do you grab it before assembly line? And comingling parts with completed machines? Heh. You have no idea of the distribution chain of b2b retail goods vs b2c service repair and such. 6-8 weeks repair time is still common, especially nowadays.
- logifail 5y ago> i can buy a $3 led from China with free shipping International shipping is not even close to being a level playing field: "Arcane rules established by the 144-year-old Universal Postal Union make it possible for a Chinese e-retailer to send a package across the Pacific to a customer in the U.S. at a cost lower than what an American competitor would spend to ship the same item to a neighboring state"[0] [0] https://www.bloomberg.com/opinion/articles/2018-10-18/trump-is-right-on-china-s-postal-subsidy https://www.bloomberg.com/opinion/articles/2018-10-18/trump-...
- saiya-jin 5y agoInterestingly, the same is valid for Europe - I got tons of shipping from Shenzen for free, and the item costed like 1$ (ie USB cables).
- sokoloff 5y agoThat’s a 2018 article and EMS rules have materially changed since then.
- ClumsyPilot 5y agoI am not in US
- kube-system 5y agoYou’re probably in a country in the UPU.
- syshum 5y agoWe have many industries of examples where this solved also by market forces as well Cars as an example, the key here is to allow the market to MAKE replacement parts, and compete to selling them. Stop vendor lock-in If I want to buy replacement part for my car I often have a selection of 3-5 different vendors making the replacement in addition to the OEM. You can not tell me that appliances, electronics, etc are that much different from cars that similar solutions can not be found. Especially given that most of these things are just off the shelf parts that the OEM combines into a product anyway
- ghaff 5y agoThere are many third-party appliance/electronics parts companies.
- eropple 5y agoYeah - and the problem here is that there are many parts. Getting a plastic wheel for my dishwasher's lower roller shelf is $12 from a third-party source (it's $16 from the manufacturer). It's like four grams of plastic. But the rarity of demand just doesn't make it make sense to keep in stock. (That sort of thing has me halfway convinced to buy a 3D printer. I just don't have anywhere to put it yet.)
- newaccount74 5y agoMake sure to check for generic wheels too! I think 90% of dishwashers have the same wheels but with different parts numbers.
- eropple 5y agoGood shout! The wheels are largely interchangeable but the wheel mounts on the basket aren't (and one of them popped free and melted on the heating element just this week!).
- syshum 5y agotrue, however the current trend is to lock down the parts and prevent companies from making replacement parts via the use of DRM, serialization, and other controls that have nothing to do with security, usability, or anything other than preventing repair Hell even Paper has DRM now, see the Latest Dymo label printers
- HPsquared 5y agoWhy can aftermarket suppliers make the same part much cheaper?
- tibbetts 5y agoSampling error. Aftermarket suppliers only get involved when they can make and sell a replacement part at a compelling price point.
- Retric 5y agoAs was just pointed out, making the part isn’t a large fraction of the cost of a replacement part. So, they need to both make the part and handle the full logistics chain to undercut prices.
- HPsquared 5y agoAftermarket suppliers have even more of a logistical burden than the OEM. They cater to a smaller market, and need to set up manufacturing for the part (which the OEM already has). Yet they still can sell the parts for substantially less.
- clusterfish 5y agoI don't buy that as a factor. Given that the OEMs overprice the parts that they have to compete with aftermarket suppliers for, why would they NOT overprice the parts for which they have no such competition? Note that being unable to profitably replicate the part does not necessarily mean that the part is naturally expensive, or that the OEM already sells it at a reasonable price. The part could just as well be hard to reverse engineer and QA for a third party, or the effort to do that might not be worth it given unknown level of demand, etc. OEM can actually have a natural price advantage over third parties in such complex parts.
- jupp0r 5y agoThis is called survivorship bias https://en.wikipedia.org/wiki/Survivorship_bias https://en.wikipedia.org/wiki/Survivorship_bias.
- newaccount74 5y agoThe heating element of my Miele washing machine broke after about 4 years, and a genuine spare part would have cost 100€. I got a 3rd party replacement part that looks completely identical for 20€. I'm pretty sure there's still a healthy profit margin on that, since they cost half of that on Ali Express. And if the original part breaks after 4 years, the aftermarket part can't be much worse. The only reason that Miele spare parts are so fucking expensive is because they make a lot of money with service. They don't want people fixing their own machines for 20€, they want to have a Miele service person come and swap the part for 250€. EDIT: And don't tell me that logistics for a heating element are hard. All Miele washers have been using the same heating element for 15 years or so, it's a drop in replacement for the previous version of the part, and it's probably also the single part that breaks most often. That part should be easy to stock and the cost to do so should be trivial.
- tpmoney 5y agoLooks identical and is identical are two different concerns though. I bought a (used) dryer from a small appliance vendor that looked identical to the new one right next to it for half as much. It was only a year later when it stopped working and I opened it up that I discovered where a thermal fuse should be there was just a straight piece of non high temp wire that had melted and thankfully not burned my house down when it failed. Which isn't to say that first party parts may not be marked up for profit, just that external looks of things don't tell you anything about the actual internal construction.
- newaccount74 5y agoI agree with your point in general. I have bought spare parts from sketchy websites in the past and sometimes they are not as good as the original. You can usually tell the difference if you look at them closely. But heating elements are very simple parts, and I bought it from a reputable local store, so I don't really worry that I'm getting an unsafe part. It's probably going to fail in a few years due to corrosion just like the original part (we have very hard water), and then I'll swap it again.
- iso1631 5y ago
- 13of40 5y agoIf that's true, the weight of a spare part should correlate closely with its price, yet spark plugs are an order of magnitude cheaper than oxygen sensors.
- simonh 5y agoThere are a lot of factors in supply chain costs aside from weight. Order volume is a huge factor. If two parts have identical component costs and weights, but one is ordered in the UK say in the thousands per year, the end purchaser cost will be a lot lower than for a part where only a few people order one each year. In fact for the latter, it might not be possible to order it directly in the UK at all.
- throwawayboise 5y agoOxygen sensors use platinum which makes them expensive.
- ksec 5y agoAnd it also pretty much sums up how most people in Tech have minimal understanding of Supply Chains and logistics works. Even distribution alone, within a single country ( ignoring the cross border logistics ) is complex enough.
- BurningFrog 5y agoWe're used to every "part' being downloadable at zero real cost. It's hard to think about physical reality when that's how most of your life is.
- AussieWog93 5y agoJust my 2 cents, but worth noting I do run a retail business and about 20% of our revenue comes from old electronics we refurb in-house. The reason that spare parts are so expensive has nothing to do with the cost of logistics or the scale of mass-production. The warehouse can simply order an extra pallet of parts and leave it on a rack as spares. Hell, this is probably what all of these businesses do. The real reason the pump costs 100 pounds is because the customer has no reasonable alternative, so they will (begrudgingly) accept that before spending 400 pounds on a brand new machine. If they found out the specific part number of the pump and ordered something compatible from an alternative supplier (I used to go to this effort when younger), it generally ends up costing around 1/5 of the price of an official one.