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I believe he is referring to an economies of scale type scenario. With a high-tech product (or most any for that matter) the manufacturer/developer has to pay h

by ABrandt 17y ago

I believe he is referring to an economies of scale type scenario. With a high-tech product (or most any for that matter) the manufacturer/developer has to pay huge sums of money before a single commercial unit is shipped. Fixed costs such as plant and manufacturing equipment are cash drains whether one or one million units are sold--hence the name fixed cost. Yea, Fusion Garage has created a tangible product. To get it to the masses, however; they must convince the public they want it. Of course theres people who are already excited about it, but that certainly won't bring in enough revenues to keep the lights on at the end of the day. I'm personally just getting tired of the same tired Business vs Tech banter. If we are to advance our industry and continue to create great innovative products, we must recognize eachother's strengths and weaknesses. Thats when the magic happens IMO.

codexon 17y ago
With a high-tech product (or most any for that matter) the manufacturer/developer has to pay huge sums of money before a single commercial unit is shipped. This really only holds true for a cutting edge product like a new CPU or the first iPod. For everyone else like the JooJoo/Crunchpad, these electronics are assembled from commodity parts and manufactured in Asian factories on the cheap. If preorders are taken, there is absolutely no reason for Fusion Garage to maintain a huge stockpile and the corresponding risk. This is why made to order companies like Dell are so successful.
- padmanabhan01 17y ago
  economies of scale and fixed costs apply for most products that involve manufacturing. Not only for cutting edge ones
  - codexon 17y ago
    Have any of you bothered to see how much it costs now to produce a prototype in China now? And do you really think that Fusion Garage is funding these factories themselves? Wake up to the 21st century please. Non-cutting edge electronics are cheaply produced in Asia. The "JooJoo" is made up of commodity electronics which means that these "low-tech" plants are easily able to solder and assemble the components together. Fusion Garage is not building the factories, mining and smelting the ore, nor fabricating their own silicon...
    - ABrandt 17y ago
      Could you elaborate on how much it actually does cost to produce a prototype in China? Further, how about a finished and consumer-ready product? I understand that what you are alluding to is a cornerstone of the modern economy, but I find it difficult to believe that the affects of manufacturing costs are essentially null on a small firm from Singapore.
      - codexon 17y ago
        Like I mentioned above, it depends on how cutting edge your product is. I can't give you any specifics but you can try contacting a Chinese supplier through Alibaba.com they will be able to give you a rough idea. I know from the downvotes I've received that I won't be wasting more time trying to convince people about their misconceptions. As a rule of thumb, the more exotic and cutting edge your product is, the more savings you will get from mass production obviously. The JooJoo/Crunchpad is not unusual. From what I've read, it's a commodity touchscreen attached to an Intel Atom motherboard. If your product is unsellable due to a small difference in the quantity you are able to sell, you have bigger things to worry about: namely the quality of your product. There's a reason why the cost of new products such as consoles or cpus are sky high in the beginning. Why should your company be any different?
        Teulon 17y ago
        > I can't give you any specifics but you can try contacting a Chinese supplier through Alibaba.com they will be able to give you a rough idea. Then your reply serves no purpose. If you do not have the data how can you make the claim?
        codexon 17y ago
        I don't have the exact data for an item like the crunchpad/joojoo, but for nearly everything I bothered checking, the price differences are quite often less than 25%. Regardless of exactly how much this margin is, it is not wise for anyone to be straddling the fine line between the maximum consumers are willing to pay and the minimum a factory is willing to charge. I leave it as an exercise to the doubters here to investigate by themselves. I am done wasting my time finding specifics just to further an argument on the internet.
- cma 17y ago
  Getting FCC approval for the device costs thousands, even if all the parts are individually certified.

by ABrandt 17y ago

codexon 17y ago

With a high-tech product (or most any for that matter) the manufacturer/developer has to pay huge sums of money before a single commercial unit is shipped. This really only holds true for a cutting edge product like a new CPU or the first iPod. For everyone else like the JooJoo/Crunchpad, these electronics are assembled from commodity parts and manufactured in Asian factories on the cheap. If preorders are taken, there is absolutely no reason for Fusion Garage to maintain a huge stockpile and the corresponding risk. This is why made to order companies like Dell are so successful.

padmanabhan01 17y ago
economies of scale and fixed costs apply for most products that involve manufacturing. Not only for cutting edge ones
- codexon 17y ago
  Have any of you bothered to see how much it costs now to produce a prototype in China now? And do you really think that Fusion Garage is funding these factories themselves? Wake up to the 21st century please. Non-cutting edge electronics are cheaply produced in Asia. The "JooJoo" is made up of commodity electronics which means that these "low-tech" plants are easily able to solder and assemble the components together. Fusion Garage is not building the factories, mining and smelting the ore, nor fabricating their own silicon...
  - ABrandt 17y ago
    Could you elaborate on how much it actually does cost to produce a prototype in China? Further, how about a finished and consumer-ready product? I understand that what you are alluding to is a cornerstone of the modern economy, but I find it difficult to believe that the affects of manufacturing costs are essentially null on a small firm from Singapore.
    - codexon 17y ago
      Like I mentioned above, it depends on how cutting edge your product is. I can't give you any specifics but you can try contacting a Chinese supplier through Alibaba.com they will be able to give you a rough idea. I know from the downvotes I've received that I won't be wasting more time trying to convince people about their misconceptions. As a rule of thumb, the more exotic and cutting edge your product is, the more savings you will get from mass production obviously. The JooJoo/Crunchpad is not unusual. From what I've read, it's a commodity touchscreen attached to an Intel Atom motherboard. If your product is unsellable due to a small difference in the quantity you are able to sell, you have bigger things to worry about: namely the quality of your product. There's a reason why the cost of new products such as consoles or cpus are sky high in the beginning. Why should your company be any different?
      - Teulon 17y ago
        > I can't give you any specifics but you can try contacting a Chinese supplier through Alibaba.com they will be able to give you a rough idea. Then your reply serves no purpose. If you do not have the data how can you make the claim?
        codexon 17y ago
        I don't have the exact data for an item like the crunchpad/joojoo, but for nearly everything I bothered checking, the price differences are quite often less than 25%. Regardless of exactly how much this margin is, it is not wise for anyone to be straddling the fine line between the maximum consumers are willing to pay and the minimum a factory is willing to charge. I leave it as an exercise to the doubters here to investigate by themselves. I am done wasting my time finding specifics just to further an argument on the internet.
cma 17y ago
Getting FCC approval for the device costs thousands, even if all the parts are individually certified.