How can the 4 letter guitar company justify their prices?

[DangerousR6]

I think this is a great thread, and appreciate you posing a thought-provoking question.

As such, I'm rethinking this thread a bit, and rather than focus on price, I'm thinking in terms of value or price/performance. From a value perspective Suhr still comes out ahead in my book, but remember when imports got REALLY good.

I remember imports used to be the bottom of the barrel cost-wise and as such, so was the product. However, something changed about 15-20 years ago, and now one can readily find amazing instruments in the $500-800 range. I remember wrestling with this when Agile guitars hit the scene. Here's a $300 LP copy, with all the same body and neck material, but with a genuine solid 3/4" flame maple top, ebony fingerboard, coil splitting (which was rare back then), and solid electronics etc. The value, at least perceived value, compared to an LP at the time was so high it was impossible to ignore. Fast forward two decades and several Gibson LPs in the collection later, and I can attest the Gibby's provide no playability benefit what so ever over the Agile. They are cool though . I'll say the same thing about Warmoth. I've purchased the most expensive flame top Showcase bodies, yet my daughters $250 Washburn Idol has a spalted flame maple top with deep chetoyance that puts my Warmoth builds to shame.

Anyway, thanks for thread. It took me down memory lane and got me thinking about a bunch of cool guitars. Value, price, it's all subjective, which is why it's nice to have so many great options. I haven't looked at the import market in a long time...off to see what cool stuff is out there.

I recall when there was the perception that there was no way ion hell a japanese made guitar could ever be as good as one made in the USA--even into the 1980s, when in reality, the lawsuit guitars being built in the 1970s were perfectly excellent while at that exact same time the big names in American guitar--CF Martin, Gibson and Fender were all putting out uneven product and making really bad cost-cutting cutting decisions and just plain poor quality control.

It really took decades for the (wise) consumer to come around and seek out old Takamines and Ibanez of that period. hell, it took a long time for people to not turn their nose up at Japanese made Fenders.


That said, I have caveats regarding imports. If it is coming from a country like Japan--with reasonable  (or good) workplace laws, countries/companies that abide by conservation treaties--or just plain protect human rights I am all for it.
Personally hate buying things made in dictatorships.

So true, it also went well into the 90's, Jackson had a similar dilemma with some of the Japanese built Dinky's. The Chushin Gakki factory was making the Professional series thru much of the 90's. Jackson eventually came to the realization that those guitars were on par with the Pro series being made in the U.S. And thus halted productionar and are sought after by many Jackson collectors, I have 3.

 

[TonyFlyingSquirrel]

Because of the smaller production numbers, I would likely categorize Suhr as a boutique builder, whose focus is on quality more than numbers. 
I've never played a bad one of their instruments, and their tolerances are very tight.

 

[WindsurfMaui]

  Let's assume I'm an average guy (in reality I'm below average in so many ways) and I want to buy a sports car. I can buy a nice fast very pretty Corvette or a Ferrari. Now the Ferrari is better made, and more beautiful and if I'm very rich and money isn't an issue I'll get the Ferrari. But to the average guy who wants something functional and very fast I'll get the Corvette and pocket the difference. Hell I'll get 2 Corvettes and still have money to put in my pocket. If I want to buy a good guitar I can buy a MIM Strat or I can buy a top 10 USA made PRS. Same thing if I'm rich and want a piece of art I buy the PRS if not I buy the MIM Strat. In reality I would probably buy an SE PRS for little more than the MIM and get something medium beautiful and well made and still be around $1,000. (OK I'm no expert in cars or guitars so my estimated prices may be a little off).  So in reality if I wanted my money to go the farthest I would buy whatever guitar is fairly made with a roasted maple neck and stainless frets put it on a plek machine for a great set up and still pocket a bunch of money. Now I understand we all value different features differently. That some will pay more for a better neck, or more for sweeter pickups. That is a given  But I just don't see how someone can take a MIM Strat put it on a Plek machine then put a different name on it and charging 3 times the price. I understand they spend a little more time on finishing the neck, have locking tuners and a better trem system but that still doesn't add up to a retail price of $3,000. All that said, people can spend their money any way they wish. I was just hoping there was some value their I wasn't seeing that people could point out to me. But it was a good conversation. Thanks.

 

[T89Rex]

Given how playable some cheap guitars available are these days, pretty much every high-end guitar is a waste of money to some extent. Start with a mid-range Squier and keep swapping components until it looks like a top of the range Fender, set it up properly and chances are you'll end up with a virtually indistinguishable guitar for half the price.

I think the Suhr difference players are responding to is that they're the only mainstream manufacturer putting those little extras we take for granted on their guitars. As far as I'm aware, Fender, Gibson and PRS don't offer anything with stainless frets, for instance.

Most players aren't modders or builders. The way they buy the guitar is the way it will stay forever. They also don't know about Warmoth or obsess over aftermarket parts the way we do. So they're in a shop trying to decide between a $3000 guitar that probably plays faster and cleaner than anything they've ever tried before, or the $2000 Fender that's like every other good guitar they've ever played. They don't know or care that stainless frets are only worth a $20 increase if you're building a neck. How are they going to get that feel they now love on the Fender? A re-fret worth hundreds of dollars on a brand new guitar? Forget that. They're holding a guitar that feels good right now.

If Fender and Gibson started offering similar builds, the competition would drive the prices down, but until then Suhr has the market on those features cornered and can get away with the premium. Of course a Warmoth is a better deal, but there isn't really a guitar out there that Warmoth can't beat on value. It's not really a fair fight.

 

[WindsurfMaui]

Well I agree there are some people who buy guitars to have one and never think about changing it. But I thought after EVH modded his guitar that many guitar players got into modding.

I think Fender offered a roasted maple neck version, but I don't know about stainless frets. Yes PRS doesn't like stainless frets so he doesn't offer them.  Personally I love the look of PRS high end guitars, but I don't like set neck guitars. And I would but a PRS SE bolt on if I could swap the neck shape. It isn't just that the PRS doesn't offer a variety of neck shapes it is the neck shapes they offer I hate.

I guess I should stop complaining if everybody who owns a guitar knew about Warmoth orders would be backed up for years. I better just be happy I can get my stuff in reasonable time.

 

[swarfrat]

Ironic that Fralin's name was invoked in the first post. Pickups are a prime example of people being willing to pay extra for perceived value that is extremely difficult to quantify

 

[bagman67]

Well I agree there are some people who buy guitars to have one and never think about changing it. But I thought after EVH modded his guitar that many guitar players got into modding.

Many is not the same as most, or even a significant fraction.  The vast majority of guitars bought are stock instruments, and as you and at least one other contributor noted, will remain stock forever.  And the big names are trying to reach the largest possible audience by making options that are popular and also cheap to modify on a factory floor:  Paint color, sometimes construction material. 


Suhr is not positioning itself as a mid-market brand - they want to reach the folks who are willing to spend fairly big dough.  Anyone who's compared a VW and an Audi can see that cars built on the same chassis can vary widely in MSRP, with the luxury brand providing vastly preferable margins to the manufacturer.  Same story to a degree with the Suhr offering (likewise Anderson, Don Grosh, and so on). 


Kiesel seems to be doing a good job of providing lots more options than your major manufacturers such as G, F, PRS, and the major Japanese names.  But they are specifically positioning themselves as a custom shop and their prices reflect that.  They don't do retail through dealers for finished instruments, and at any given time they have only a few dozen finished  instruments ready for sale out of the factory.  The base price of a solid-colored, bog-standard bolt-neck Strat clone from them has gone up 30 percent or more in the last couple years.  And that's due in part to the input costs of designing lots of new models over the same period, but the price of a top-end guitar from them has skyrocketed simply because they can get away with it.  Jeff Kiesel is kind of a douche sometimes in his videos, but he's smart enough to know that aggressively marketing the instruments as true custom pieces also widens the margins.  And he's utterly unapologetic about pricing every option to match the main message that each instrument is a one-of-a-kind piece.  (I mean, come on, a $120 bump to go from alder to ash for a painted Strat body? $20 for a different color of plastic inlay dots?)

Suhr falls short of Kiesel's level of individually tweakable features, but they are in the same game, and the margins for the luxury-brand instruments  they provide are likely to be similarly attractive from a business owner's perspective.  I obviously don't have access to their books, but my guess is they are not doing too bad.  The $100k capital outlay for a PLEK machine (or whatever the actual installed cost is) enables consistent work that saves a lot of skilled labor costs and pays for itself over time, broadening profit margins and, to the extent the PLEK machine delivers more playable instruments, enhancing reputation and thus increasing demand for their guitars in the long run.  And the domestic custom or near-custom builders in the Suhr stratum are universally exploiting technology such as PLEK and CMC machinery to ensure consistent quality while reducing domestic labor costs.


Anyway, all this is to say:  They cost what they cost because they think they can get it, and because the value they deliver (tangible and otherwise), in their estimation, is worth it to consumers.

 

[Seamas]

But I just don't see how someone can take a MIM Strat put it on a Plek machine then put a different name on it and charging 3 times the price. I understand they spend a little more time on finishing the neck, have locking tuners and a better trem system but that still doesn't add up to a retail price of $3,000. All that said, people can spend their money any way they wish. I was just hoping there was some value their I wasn't seeing that people could point out to me. Thanks.

What makes you think it was an MIM Strat?
Isn't the company making their bodies and necks in the US?


I have no certainty of what the wages are at the company in question, but it is entirely possible that they way their workers competitively, and compared to the "big" brands, likely have almost comparable marketing costs. (They paid decent money for their website for sure).

It is worth noting that adjusted for inflation a Strat made in 1960 retailed for between $2,270 and $2,500 in today's dollars--and we're just talking about regular production guitars. The Suhr suggested retail is $2,800. I imagine the selling price is a couple hundred lower.


I'm checking out their website and am actually impressed at the pretty reasonable asking price of some of their amps.

 

[PhilHill]

When Leo Fender introduced the Telecaster in 1950 it cost a little under $200. bucks. In today's pretend money that would be a little under $2200. bucks. Are they really anymore expensive than they ever were.Paul Bigsby got $600. for his solidbody spanish guitars, and he had a 3 yr waiting list because they were considered the best you could get. And, as has been mentioned, try looking at the price of a professional grade cello. 

 

[WindsurfMaui]

  Seamas I believe the guitars are manufactured overseas and assembled in the U.S.

I understand inflation. And if all products showed inflated prices I wouldn't have a complaint because everything would be priced the same. But even though Leo Fender charged $200 for a Strat back then Fender is selling well made MIM Strats for not more than that now. And I would say the current quality of Fender guitars is better than those made in the 50's because of the improvements in parts So in reality the current MIM guitars if put into 1950 dollars would sell for $70 and be a better guitar than those made in the 50's and selling for $200 then. (And for $20,000 now)

Well if I can get you all to pledge secrecy I am going top start a guitar company. I will have a webpage that offers Strats with all the options Warmoth offers (without mentioning Warmoth of course) and charge $3000. People can choose their options I'll buy the parts from Warmoth and Plek the finished guitar (I'll take it to a store that has a Plek machine so I wouldn't have to spend 100k to buy one) and call them Custom Made and I'll get rich. (And so Warmoth doesn't get mad at me Warmoth I am only kidding I wouldn't do that.)  :headbang1:

 

[stultzies9]

Windsurf, you're wrong about that. Suhr's stuff is all made here in the States. Someone even mentioned earlier in the thread that there's a factory tour vid you can watch to see that. They're not taking MIM stuff and Plek'ing it and charging $3k. They have their own CNC machines, just like Warmoth and Kiesel and Fender do (for their US lines), and everything Suhr makes is produced in that factory. I'm honestly not sure where you got the info that they were taking overseas stuff and doing the assembly.

There WAS a very short lived line called Rasmus that John Suhr put out about 10 years ago that was exactly that situation, but it never had the Suhr name on them.

Also, G&L has their Tribute line, where they have the parts manufactured overseas, and then do the assembly and setup. But those usually run less than $1k.

 

[DuckBaloo]

  Let's assume I'm an average guy (in reality I'm below average in so many ways) and I want to buy a sports car. I can buy a nice fast very pretty Corvette or a Ferrari. Now the Ferrari is better made, and more beautiful and if I'm very rich and money isn't an issue I'll get the Ferrari. But to the average guy who wants something functional and very fast I'll get the Corvette and pocket the difference.

Two different markets. Ferrari wants the rich customer who can write the check without hesitation, they do not want deal with someone who can't decide between saving money on the Corvette, they would prefer that customer go elsewhere and stop wasting Ferrari's time. 

It's the same with the boutique guitar market, they aren't interested in, can't afford to cater to, and don't marketing to the customer who needs to bet the most bang for the buck. Some inflate prices just to drive the those borderline customers away because he people who can't afford a $3,000 guitar but buy one anyway are high-hassle customers — the ones who will spend months asking questions and discussing options, complain or send back a guitar with a small ding, or file a warranty claim over a non-issue — the labor lost dealing with those customers isn't worth the sale.

There really is not right or wrong choice when shopping, everyone is different. Do you either get market strategy or you don't... and if you don't, those companies don't want you to join their club. They know who they have to target, waht they have to charge, and how many they have to sell to run the business on their terms and keep the doors open.

Here is a different tack. I believe in the 80/20 rule. I believe a Warmoth neck is 80% ready when it arrives, it's "good enough" — very playable, at least on par with a good production guitar, better than many. But I put the time and care into closing the gap — fret level, add fretboard fall-away, roll the fingerboard and fret edges, install threaded neck inserts, install a bone nut and do any finishing. That's $500-1000 worth of labor and overhead into what was a $250-300 neck. I can do that work myself (though not as good as the experts), but if I couldn't I believe it is well worth the cost of having a boutique builder do it for me. I've had guitars plek'ed and some were as good as having a great luthier do the work, some were not, but none were better.

 

[stratamania]

I think Windsurf is trying to say that if you take a MIM Fender and give it a Plek service it would be equivalent to a Suhr which is made in the US.

This would not be true however either.

A Suhr is a Suhr
A MIM Fender with a plek fret job is a MIM Fender with a plek fret job.
A Warmoth set of parts put together by Windsurf is a Warmoth set of parts put together by Windsurf.
A Warmoth set of parts put together by John Suhr is a Warmoth set of parts put together by John Suhr

All of these things are what they are. None of them are equivalent.

 

[PhilHill]

  Seamas I believe the guitars are manufactured overseas and assembled in the U.S.

I understand inflation. And if all products showed inflated prices I wouldn't have a complaint because everything would be priced the same. But even though Leo Fender charged $200 for a Strat back then Fender is selling well made MIM Strats for not more than that now. And I would say the current quality of Fender guitars is better than those made in the 50's because of the improvements in parts So in reality the current MIM guitars if put into 1950 dollars would sell for $70 and be a better guitar than those made in the 50's and selling for $200 then. (And for $20,000 now)

Well if I can get you all to pledge secrecy I am going top start a guitar company. I will have a webpage that offers Strats with all the options Warmoth offers (without mentioning Warmoth of course) and charge $3000. People can choose their options I'll buy the parts from Warmoth and Plek the finished guitar (I'll take it to a store that has a Plek machine so I wouldn't have to spend 100k to buy one) and call them Custom Made and I'll get rich. (And so Warmoth doesn't get mad at me Warmoth I am only kidding I wouldn't do that.)  :headbang1:

I would only have a couple questions about that statement. I can see your point somewhat, however have you ever played a brand new 1950 Telecaster? which is what I said, not Strat. If not I'm not sure how you can make an accurate judgement like that. And which parts are so well improved? The parts their using now are not much different than the ones they used then, and some say the old pickups were actually better because of differences in the magnets, cobalt vs alnico construction. The woods were definitely more desirable back then before over-harvesting and waste had reduced the supply old of growth trees. Yes I know Leo bought what ever was cheap and plentiful, but it was still better wood in MHO. And one could ask why, if the guitars now are so much better, are the ones from back then selling for $20,000.?

 

[Seamas]

  Seamas I believe the guitars are manufactured overseas and assembled in the U.S.

I understand inflation. And if all products showed inflated prices I wouldn't have a complaint because everything would be priced the same. But even though Leo Fender charged $200 for a Strat back then Fender is selling well made MIM Strats for not more than that now. And I would say the current quality of Fender guitars is better than those made in the 50's because of the improvements in parts So in reality the current MIM guitars if put into 1950 dollars would sell for $70 and be a better guitar than those made in the 50's and selling for $200 then. (And for $20,000 now)

Not sure I agree about any lack of quality of pre-CBS Fenders, but my point was speaking more about labor costs--which is why I am comparing USA made 50s strats to USA made Suhr guitars.
This is where there is *something* more of a price comparison for labor (when you account for inflation, etc)

I don't know why you keep bringing MIM guitars into this. Suhr guitars are not MIM. (I have nothing against MIM guitars or Mexican workers--just that their labor costs are an uneven comparison).

 

[TBurst Std]

I am curious if the OP has ever even played a S**r
I have a number of times. Out of the box, playability cannot be compared to a MIM.
Set up correctly sure. How many hours did that take you? thats x $50 is fair.
Oh wait, that MIM didn't come with a hard case, thats another $100.
Keep going,,,,,,,
I'm not trying to justify the pricing, what I am trying to illustrate is:
People obviously see value for price, otherwise, they wouldn't be in business.
It's really that simple.

Know what you want to make and who you want to market it to.

To suggest they HAVE to justify it, thats just wrong.

 

[TBurst Std]

Just went out and priced a S**r Reb Beach, ask of 4000, I could get for 3450 incl shipping.
Just priced out the nearest thing I could on the W (could not do a FULL Koa body), Price with my time and labor (10 hrs at $50) and $200 for Cagey's neck work - 2814 before shipping. so lets tack on another $50 for that and a case at $100. So we are at 2964 and I don't even have a full Koa body.
Less than $500 difference.

 

[JohnnyHardtail]

Just went out and priced a S**r Reb Beach, ask of 4000, I could get for 3450 incl shipping.
Just priced out the nearest thing I could on the W (could not do a FULL Koa body), Price with my time and labor (10 hrs at $50) and $200 for Cagey's neck work - 2814 before shipping. so lets tack on another $50 for that and a case at $100. So we are at 2964 and I don't even have a full Koa body.
Less than $500 difference.

You should also add in the cost of PLEK fret level and nut cutting.  Also factor in the potential risk of something goes wrong, guitar getting damaged, or if the fret job gets messed up.

 

[WindsurfMaui]

  Well I seemed to have kick over a hornet nest with this thread. Folks all I was asking in the beginning was there something that I was missing on why the guitars were not that much different from MIM Strats yet were priced 4 times as much. I expected someone to tell me there was a special feature, a secret pickup winding, sparkle dust that justified their price. That is all I was asking. I'm not trying to under pay workers for their efforts, I'm not trying to over turn the capitalist system, and I'm not trying to offend any of you that own very expensive guitars that you love to play. I was just wondering if I was missing something in the building.

That said people can play what they like. I own a Warmoth roasted maple neck with an ebony fret board and stainless steel frets and that is all I want to play. I'm assembling a couple of pick guard set ups with different wiring schemes that I will stick in a body but as long as that neck is attached that is all I want. Nothing more. I have found my nirvana. If a $3,000 guitar is your nirvana that is fine.

Those $3,000 guitars were originally made outside the U.S. nut are now made in the U.S. (I stand corrected) except for the finishes because you can't do Nitro in California so I think they are probably shipped to Mexico for finishing probably to the same factory that does the MIM Strats.

I haven't played a $3,000 S guitar. I have a long time ago held and strummed a '65 Strat and was wholly unimpressed. I appreciated  that it was one of the first so it was very valuable but I doubt the wood had any secret sauce and the changes in the trem systems, nuts, staggered tuners roasted maple necks and stainless frets I think make today's guitars totally better than those old ones. Yes I understand people buy old things because there are very few of them and collectors are willing to pay more for them as bragging rights. But as a playing instrument they aren't better than today's guitars in my opinion.

 

[DuckBaloo]

Suhrs were never build outside the U.S., I don’t understand how you keep persistently claiming that they were.

And it is not illegal to shoot nitro in California, that's a myth. Plenty of guitar companies spray nitro in California (including Fender), as to do car and furniture restorers. Fender sprays a lot of nitro in Ca.