Society of Robots - Robot Forum

Electronics => Electronics => Topic started by: kerrinal on June 26, 2013, 01:39:07 AM

Title: Why the little accessories is so cheap on ebay or the amazon platform
Post by: kerrinal on June 26, 2013, 01:39:07 AM
I just find that many robot accessories are so cheap on ebay or the amazon.The sellers even provide the free postage.How can an arduino sensor charge 2 bucks including the shipping fee from china to United States? Not just the sensor,the others like the relay or the breadboard ,battery holder etc charges less than two or three buck.I mean it even will not cover the postage.
Title: Re: Why the little accessories is so cheap on ebay or the amazon platform
Post by: jwatte on June 26, 2013, 03:23:12 PM
The actual cost of electronic components is pretty low, when bought in large bulk. There's still some labor and capital cost involved in the actual manufacture of the stuff, but the smaller/simpler it is, the lower those costs.

A large cost in building products comes from research, development and testing, as well as marketing, as well as customer support, as well as distribution and logistics.

If a company can clone some existing product, they cut out research, development, and probably testing costs. If they sell on eBay or Amazon only, there's no marketing cost. If they provide no customer support, and distribute using regular mail, then those costs are pretty low as well.

It sounds like the capitalist market, done right! Unfortunately, it's not sustainable, for a few reasons.
First, someone needs to do the research, development, and testing of the original products.
Second, when sellers are operating on razor thin margins, if anything goes wrong (and it will,) it's the customer who's impacted, not the seller.
If a seller doesn't have to spend money building up a brand and relation with a customer, that seller can also just burn an identity every six months and pop up under a new name when the feedback gets too bad.

All in all, you don't always get as muach as what you pay for, but you pretty much never will get more than what you pay for.
Title: Re: Why the little accessories is so cheap on ebay or the amazon platform
Post by: johnwarfin on June 29, 2013, 07:28:03 PM
thats half the story. shipping is the other half. chinese govt subsidizes 95% of postage costs there but the usa govt subsidizes relatively little. it costs about 11 cents to send an "e-packet" from china but to return that same item to china runs about $12.

and as mentioned theres a huge in difference in customer support. noobs are better off buying from places like dimension or sparkfun even with their 500%-1000% markup but experienced diyers can save a fortune buying direct from the overseas source.
Title: Re: Why the little accessories is so cheap on ebay or the amazon platform
Post by: jwatte on June 30, 2013, 10:10:05 AM
Actually, if you want good customer support, I'd suggest Pololu, Adafruit, and Trossen, over those two options. All three of those companies have gone the distance for me in various situations.

And I don't think they have a 500% mark-up. In commerce, if we gauge MSRP ("Manufacturers Suggested Retail Price") at "100%" and the raw manufacturing cost is 40%, the discount and warehouse sellers will then charge 60% (a 50% mark-up) and retail sellers will change 80% (a 100% mark-up.) When it comes to the Robotis servos, though, I doubt there's anywhere near that level of margin, given the small difference in cost between the retail boxes, and the bulk boxes. Same thing for computers and TVs: the margins are a lot thinner. Also note that the margin does pay for things like "interest and depreciation of keeping items in stock" and "keeping the support people's kids in daycare so the support people can spend time on your problems" and "defective item return allowance" which you don't get from the raw items.