Garmin and Apollo

"Jay Honeck" writes:

The surviving company will usually optimize the product price to
maximize total profit. Many times, the optimal total profit is
achieved with a lower product price generating significantly
increased volume.

And how is this determined, if there is no other show in town to
compete against? Answer: By setting it at whatever the (formerly)
rich pilot will pay. If there is no UPSAT to field a competing
product, what possible incentive will Garmin have to lower the
price?

They'll set the price wherever it fits best on the supply/demand
curve:

http://www.wikipedia.org/wiki/Supply_and_demand

Assume (for a new model) a that Garmin has a fixed overhead of $10M
(for certification, equipment, plant, etc.), and variable costs of
$500/unit -- would Garmin rather wholesale 1,000 units at $10,000, or
3,000 units at $5,000?

Before the StrikeFinder came out, for example, BFG still couldn't
charge $25K for a StormScope, even without any competition in the
range. Competition does help, of course, but it's not the only thing
that controls prices.

No, less competition in the avionics world is going to hurt us all,
I'm afraid.

That may well be true, but this might also be an incentive for someone
else to enter the market -- maybe some UPSAT employees will leave to
form their own startup, the way the Garmin guys left Bendix-King.

To take another example, you have the only hotel at your airport --
what keeps you from raising the rates to, say, $500/night?


All the best,


David

To take another example, you have the only hotel at your airport --
what keeps you from raising the rates to, say, $500/night?

Heeeyyyy....


--
Jay Honeck
Iowa City, IA
Pathfinder N56993
www.AlexisParkInn.com
"Your Aviation Destination"

Besides economics (which is a big part, don't get me wrong), I wonder
about the technological advances. These companies seem to play off
each other to push the envelope. I recall being impressed between the
612 and Flybuddy, then the GPS155, to the Northsat M3, to GX60, and so
on. Easier to operate is better and safer.

In the press release, Garmin said, "As a combined organization, we
look forward to achieving even greater levels of product innovation
while providing a higher level of service to all of our aviation
customers."

But I worry about the incentive to improve. The cost to market for a
new player will be enormous, because lots of the talent and experience
is locked up.


Jay Honeck" wrote in message news:8c%6b.393840$uu5.73374@sccrnsc04...
To take another example, you have the only hotel at your airport --
what keeps you from raising the rates to, say, $500/night?

Heeeyyyy....

(S. Byrd) writes:

But I worry about the incentive to improve. The cost to market for a
new player will be enormous, because lots of the talent and
experience is locked up.

Fortunately, the talent and experience required is less and less
esoteric aviation stuff like VOR or ADF and more and more common stuff
like GPS and ruggedized, portable computing. Lots of people know that
stuff, though they'll need a couple of experienced people to steer
them through the aviation-specific certification and marketing parts.
Garmin cannot pay *all* of its people enough to keep them away from
startups, and anyone who leaves will take experience with him or her.


All the best,


David

David Megginson writes:

(S. Byrd) writes:

But I worry about the incentive to improve. The cost to market for a
new player will be enormous, because lots of the talent and
experience is locked up.

Fortunately, the talent and experience required is less and less
esoteric aviation stuff like VOR or ADF and more and more common stuff
like GPS and ruggedized, portable computing. Lots of people know that
stuff, though they'll need a couple of experienced people to steer
them through the aviation-specific certification and marketing parts.
Garmin cannot pay *all* of its people enough to keep them away from
startups, and anyone who leaves will take experience with him or her.

Yep, that's what I was thinking.

Wasn't Garmin founded by a couple of Bendix/King ex-employees?

-jav

On 08 Sep 2003 14:16:07 -0700, Javier Henderson
wrote:

Yep, that's what I was thinking.

Wasn't Garmin founded by a couple of Bendix/King ex-employees?

-jav

Yup - Gary and Min. Gary's left, but Min is still working it.
Strangely, Gary was the force behind the aviation thing, Min never
wanted it. They just may be in too deep to get out, or then again,
Honeywell may be a buying mood one day.

In article , David Megginson
wrote:
To take another example, you have the only hotel at your airport --
what keeps you from raising the rates to, say, $500/night?

A.) Jay knows pilots
and
B.) Jay knows that pilots are cheapskates.

:-)

EDR writes:

In article , David Megginson
wrote:
To take another example, you have the only hotel at your airport --
what keeps you from raising the rates to, say, $500/night?

A.) Jay knows pilots
and
B.) Jay knows that pilots are cheapskates.

Exactly. Garmin knows the same thing.


All the best,


David

David Megginson wrote:
To take another example, you have the only hotel at your airport --
what keeps you from raising the rates to, say, $500/night?

Absolutely nothing....take a look at the Oshkosh area during EAA.

On 8 Sep 2003 23:39:21 -0600, (blanche cohen)
wrote:

David Megginson wrote:
To take another example, you have the only hotel at your airport --
what keeps you from raising the rates to, say, $500/night?

Absolutely nothing....take a look at the Oshkosh area during EAA.

Is it that bad? I would like to go again in 2004, but I'd rather eat
a worm (or fly a Piper) than camp out again. Any tips? I'd like to
make those reservations NOW!