09-10-2007, 08:51 AM #1
- Join Date
- Jul 2007
Market Opportunities for aftermarket community
It seems to me that there's a huge market void for aftermarket parts for watercraft.
The reason I say this is because byond 4tec (which seems to be pretty stand up) is Riva, which in my estimation is WAY overpriced on just about everything.
You can buy a universal catch can kit online for $20 or you can pay Riva $135 for it.
You can buy an oil boy extractor for about $58 from any number of sources or pay Riva $90+.
Don't even get me started on the prices for the performance kits.
I've bought full out race blower kits and seen turbo kits for V-8 setups for less than what some of these kits are advertised.
I'd imagine that they price these items for what the market says is reasonable and there's a large amount of research/testing that goes into everything, but honestly, a set of polyethylene bushings that cost $.030 a piece to inject/blow mold shouldn't cost $20. The 3" air intake kit.....forget about it. They're costs are probably less than $40, the majority of that being the filter.
I think a little healthy competition in our sport/hobby will go a long way to improve products and bring the prices down.
09-10-2007, 09:18 AM #2
Geez!! I agree with you!! Niche market = $$$$
09-11-2007, 06:50 AM #3
Well, I agree and disagree. If you want good products you have to pay quality people who know what they're doing to develope those products. There are far less experts in the marine world than there are in automotive. People like to look at a product and only break it down to raw materials and forget you're also paying for PEOPLE. It goes to pay the salaries of all the expertise you get along with the product. It pays to build stock so they can ship it out when you order it and not have to wait months on end for it to build to order. If you want quality you have to realize you're not just paying for some schmo to weld plates together in his garage. You've paid for hours of R&D and testing, hours where there was no $ coming in. Sure, there are people out there who can look at a Riva (or similar Co.) and copy the design, and throw it together cheaper. But, that copier would have never been able to design and build it on their own, and if they tried, they would soon be here complaining it costs too much to come up with something original from scratch.
So, if you want to compete, go ahead, get an engineer, manufacturer, and distribution system in place capable of serving thousands of orders. Oh, BTW, in order to do it legally and fair, you have to come up with original ideas and not just copies of ones you've seen. Now how much did you spend before you filled one order?
Cause we've never seen piss poor customer service, poor QA, or long lead times and broken promises from people claiming to do it cheaper.
That is all. You say they're too expensive, I say thank you Riva for developing the ideas and products which inspire competition and feed our addiction. Are they more expensive than most? Probably. Is it worth it? IMO yes.
09-11-2007, 03:13 PM #4
- Join Date
- Jul 2006
09-11-2007, 04:31 PM #5
Sean, excellent post
Not everyone understands what it takes to get a product to market. Take a guess at what it costs to get something as simple as an intake grate to market? Try around 30 grand Ask me how i know
We should all be thankful for the big companies such as Riva and R&D that put forth the big $$$ on R&D and then finally produce these products that we comsumers purchase at what i would say is a fair price. Without them we would have nothing!
You cannot possibly compare the automotive aftermarket to the PWC aftermarket. The customer base for the PWC parts is far smaller than that of automotive therefore the prices tend to be a bit higher to cover the overhead of the development of such products.
09-12-2007, 01:00 AM #6
- Join Date
- Nov 2006
As for the automotive market vs PWC market you can compare them based on demand. If their is a consumer demand for less expensive parts you will find that someone steps in to fill it? And much like the automotive world these cheaper parts may not be of the same quality they will find their place in the market just like they do in the automotive world, and when companies like Riva and R&D see this they will have to drop their prices to help retain market share. Good parts will aways cost more but what I think the first poster was tring to say is he wants more choice or maybe some competition to help bring the cost of parts down...?
09-12-2007, 08:37 AM #7
you can't compare the auto industry to the pwc industry in terms of aftermarket parts and costs.
turbo kit for a v8's and such are relatively cheap because they are less complex to engineer and the parts will carry over a multitude of vehicles.
sure it would be nice to have more of a varitety since it is the spice of life but when you flood the market with inferior parts at a cheaper costs, it doesn't give the current players any reason to drop the prices because you are getting a qulity product for the money.
being a member of SEMA and having attended the SEMA show in vegas the last 3 years i can attest to the knock off products that people try to flood the market with. it's mostly overseas companies that are doing because of the stupid low rates they are paying their workers. yeah sure the products are cheap and look good but the perform like a hippo trying to ice skate.
not investing in the R&D and producing an inferior product is the kiss of death for an aftermarket company, if they are of the same quality and performance level but at a cheaper price then you have a competitional situation where it will force the other pleyers to lower the prices
09-13-2007, 09:21 AM #8
- Join Date
- Jul 2007
I'm not talking about one off parts. I'm talking about the sales portion.
Most of what Riva sells, they don't manufacture. Regardless of whether or not they warehouse, they can drop ship items.
Buy an intercooler from Riva and what does it say? "Vortech."
I haven't done it, but I'd be willing to bet I can buy the same intercooler from Vortech MUCH MUCH cheaper than what Riva is charging.
I understand R/D and Overhead costs probably better than most. My point is that it degrades your reputation as a company when I flip through a catolog and see a product listed for 30-40% MORE than what you can find it for elsewhere.
The hardcore Riva products that they created and fab, by all means, make what you want.
Long term business strategy is all about weighing the short run profits versus the long run sustainability of your customers.
I don't think in all my years of modding cars that I've bought more than a couple of items from Jegs or Summitt, because consistently, they are overpriced. You can find products cheaper from so many other vendors.
Some items, like blockoffs or waterboxes or intakes, or whatever, are either proprietary or Riva actually manufactures them. So they're single source and can get away with charging whatever the market will pay.
But when I can buy an intercooler (triple pass) that's twice the size of the one in the Riva kit AND a bigger/better blowoff valve, it just makes me scratch my head and wonder why no one has decided to undercut them.
I wouldn't go through the trouble of hiring engineers and product developers, I'd just package, ship and sell manufactured products cheaper than Riva.
$125 for a catch can? Gimme a break. You can literally MAKE YOUR OWN out of a soup can and some steel wool.
It won't be too long before their short term strategy invites others to come compete. I'm seriously thinking about simply buying bulk items and selling them cheaper.
You want an example that made me laugh? I bought my Riva Stage 1 kit for $70 cheaper through one of their distributors than I could directly from them. When I called them to ask if they'd match the price, the guy on the phone said "the price is what it is." So they lost revenue because they sell their own products at higher prices than their distributors. That makes zero sense. Either compete with your distributors or don't (most businesses don't)
09-13-2007, 10:26 AM #9
It is always cheaper to copy another idea, than built it from the thought to the final product.
There are many things that go into the cost of getting that part to you that you end up paying for.
I am not condoning their prices or judging the quality.
There is a lot of R&D, costs of warehousing, handling, paying employees, insurance, overhead, and future R&D is extremely expensive. Oh yeah did I mention taxes?
You and I can design catch can based on there product for say $30 of materials. Then consider you havingto go out and purchase all the tools necessary, the cost of running the drill, the cost in gas of going to the stores to get the materials, you many need a jetski to test the product, a vehicle and trailer to get the ski in the water, oh yeah forgot the time to install it, the time to test it on the water and so on.
Even at $10 an hour for labor you are already in for at least 4 hours.
$30 for catch can and materials
$5 for gas running to the stores
$ 50 for tools (no idea jsut a number)
$5000 for a jetski
$10 gas for the jetski
$5 gas for vehicle
So almost $5200 for that catch can.
09-13-2007, 10:37 AM #10
- Join Date
- Jul 2007
For an actual Riva product, I'd agree. But like I said, most of Rivas products are either packaged from other manufacturers or straight up vendor items (produced by someone else wholly).
Why oh why would I pay $91 for an oil boy fluid extractor when I can buy it for less than $60 at five other vendors? There is no R/D there. No extreme overhead to speak of (Riva has the same overhead considerations as every other vendor, labor, burden, accounting, taxes, lights, property rental, advertising, etc, etc, etc).
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