Festool clamps now made in Vietnam?
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jasonrohrer
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At Woodcraft today. Was about to buy 4 clamps for $130. The clerks at the store gasped when they saw that total ring up. I was a little shocked too, but then I said, "Hey, things made in Germany cost more." I flipped over the package to show them, and then I saw "Made in Vietnam". Feeling like a total idiot, I returned the clamps to the shelf where they came from.
Regardless of whether you agree with making things cheaply in the third world, we still have a problem here:
The price has not come down to match the new country of manufacture. These were the long screw clamps, and they were $65 for a pair, or $32.50 each.
There's a kind of bait-and-switch that's happening here. Anyone buying Festool anything is (apparently) willing to pay a lot more money for high-quality stuff that's specifically NOT made in the third world.
The average factory wage in Vietnam is $1.29 USD per hour.
There's no way that there's some combination of 25 hours of labor and/or $32.50 worth of materials in one single screw clamp.
The average factory wage in Germany is $15/hour. And I'm guessing that skilled factory work, in a Festool factory, gets paid even higher than that.
Things that are made in Germany cost a lot more for very good reasons.
Making something in the third world and charging the same price for it is deceptive.
Regardless of whether you agree with making things cheaply in the third world, we still have a problem here:
The price has not come down to match the new country of manufacture. These were the long screw clamps, and they were $65 for a pair, or $32.50 each.
There's a kind of bait-and-switch that's happening here. Anyone buying Festool anything is (apparently) willing to pay a lot more money for high-quality stuff that's specifically NOT made in the third world.
The average factory wage in Vietnam is $1.29 USD per hour.
There's no way that there's some combination of 25 hours of labor and/or $32.50 worth of materials in one single screw clamp.
The average factory wage in Germany is $15/hour. And I'm guessing that skilled factory work, in a Festool factory, gets paid even higher than that.
Things that are made in Germany cost a lot more for very good reasons.
Making something in the third world and charging the same price for it is deceptive.
luvmytoolz
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jasonrohrer said:
Apples business model in a nutshell!
mino
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And the fact that the same quality raw materials cost mostly the same, be it in Germany or Vietnam. Yes, the European steel makers are going bankrupt these days ... precisely because no tarrifs were put in place while the "eco" regulations raised costs.xedos said:
What people often miss is that, these days, these things are *not* made by hand but by big automated machines. Labour goes in as maybe 10-20% of the total cost. They do save by leaving Germany, but the bigger cost saving is in energy prices and the environmental regulations savings.
And I do not mean the pulution per se. Just the paperwork for a new plant in the EU is like 1/4 of its total cost (!) these days and it can take a decade to get the approvals for industrial stuff, assuming one even gets them.
This is not to "defend" Bessey, but to make clear the labor cost difference is nowhere as signifficant as many assume these days. Not for industrial products like these.
I know of many of the German/Europe makers who are forced to move out just to keep their price level (and so stay competive on the Global market) as their European production costs are going through the roof. So their "same price" are actually "discounts" from the otherwise-inevitable price increases in many cases.
Ref. Festool
What I see them doing is keeping the critical/complex stuff in-house while outsourcing things which either they cannot make (hacksaws) or which are not their core competence and others can make them not only cheaper but better (batteries, chargers). IMO, that is as sound a strategy as it gets.
Besides, it is not as if they were "moving" from DE/EU. They are, in fact, expanding their manufacturing capacity. Their new plant they boasted with the CSC 50 is *in addition* to existing plants in DE and CZ. Also Shaper making is to be brought "in-house", if not already, from what I gather.
On top of that TTS is culling their Narex Czecho-Slovak market specific brand and moving its tools to Chinesium (the Makita variety). Mainly to free up capacity for Festool stuff at their Česká Lípa plant ... No "Doom & Gloom" at Festool at any rate.
jasonrohrer said:
Things aren't priced for what they cost to make but what they can sell them for. The higher the cult factor, the more this applies.
The 300mm Festool clamps are, from what I can see, besides the color, exactly the same as the Bessey GTR30B6 clamps. The Festools cost €50 for a pack, the Bessey clamps are like €40 a pack.
unknown user
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I am disappointed that cursing at Vietnamese clamp in the mother tongue would not be understood. Now I suppose we will have to learn Vietnamese to properly shout vulgarities when the clamp makes me make a mistake.
Crazyraceguy
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Coen said:
And if you could buy the same clamp from another lesser brand, the price would be lower yet. It's not like Bessey is immune to the higher prices for the sake of brand name either.
But another similar comparison could be made for the contractor's favorite DeWalt. You buy a drill/driver "set" which includes the charger and 2 batteries, yet those same batteries individually cost as much or more. So, either the batteries are seriously over-inflated or thy really are making that drill for nearly nothing and selling it as such (when you buy the batteries too)
Yes, this is a "discounted" entry level marketing thing, but there is no way they are selling them at a loss. (or even a push) There is no guarantee that you would ever buy any other tool on that platform, where they could get their money from you later.
I have heard, from some critics of the Chinese manufacturing model, that things like that basic drill can cost the company as little as $10, not counting the battery. This is how the "admittedly" directly Chinese brands like those from Harbor Freight can sell for so much less.
You are paying for that DeWalt name too. (or Milwaukee, or whatever) It's at a lower price-point, but the same situation.
Where I have issues with this is in licensing the brand name, where the big company doesn't touch the thing at all. This is certainly not a Festool exclusive, they all do it. I get it, you can't specialize in everything, so it makes sense to sub-contract these items. But the price needs to reflect that. When these tools are made by other higher end manufacturers (or higher income countries at least) it "matches" and is acceptable. Wera or Wiha for example, making hand tools.
Going to a cheap to manufacture country is purely about profits. It's not only abuse of customers, it hurts the home country's employees too.
If they do want their name associated with cheap tools, don't use cheap sub-contractors.
mino
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[member=58857]Crazyraceguy[/member]
Just to chip in ... China is .. these days ... is very much a "middle income" country. Same goes for ROC for a couple decades too. There are still areas inlands where labor is cheap, but those have other challenges like a lack of transport etc.
Places like Vietnam or Bangladesh are where "low-income" still applies and so makes like Bessey make plants there.
These days the Chinese (be it the Island or Mainland ones) are able to make reasonably good stuff for cheap courtesy of the sheer size and co-location of their manufacturing.
They are extremely efficient thanks to a streamlines supply chain with all suppliers commonly within a couple tens of miles. These days it goes so far that many components are so specialised that you *cannot* buy the parts/components of-the-shelf anywhere except from one or two chinese makers.
For many miche items the Chinese have the whole "market" to themselves thanks to their scale. For low-volume (thin 10s of thousands/year) often no one can compete with them on price (at equivalent quality) even if one counted with zero wages for the workers.
Something along how the Detroit area simply ruled car manufacturing on price/value it its heyday. Sure, they still are not high-income country, but we are fooling ourselves thinking their low costs are still tied to low wages.
Just to chip in ... China is .. these days ... is very much a "middle income" country. Same goes for ROC for a couple decades too. There are still areas inlands where labor is cheap, but those have other challenges like a lack of transport etc.
Places like Vietnam or Bangladesh are where "low-income" still applies and so makes like Bessey make plants there.
These days the Chinese (be it the Island or Mainland ones) are able to make reasonably good stuff for cheap courtesy of the sheer size and co-location of their manufacturing.
They are extremely efficient thanks to a streamlines supply chain with all suppliers commonly within a couple tens of miles. These days it goes so far that many components are so specialised that you *cannot* buy the parts/components of-the-shelf anywhere except from one or two chinese makers.
For many miche items the Chinese have the whole "market" to themselves thanks to their scale. For low-volume (thin 10s of thousands/year) often no one can compete with them on price (at equivalent quality) even if one counted with zero wages for the workers.
Something along how the Detroit area simply ruled car manufacturing on price/value it its heyday. Sure, they still are not high-income country, but we are fooling ourselves thinking their low costs are still tied to low wages.
Crazyraceguy
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mino said:
Agreed. It's just that they pretty much started this trend. Back then the stuff was sub-par "junk" and they have stepped up their game. They are making this in sheer volume, which reduces the cost per unit, up to the point of diminishing returns anyway.
The lower income countries are working their way into this now too, simply because there is still some market for that cheap stuff.
Back in their day, those Detroit car manufacturers where making huge profits off of the backs of consumers too....and IMHO way over paying union labor.
That is how Japanese cars came in and took over, even with the added expense of shipping.
It took a while, because people were used to what they always had, and some loyalty to the home country. It didn't hurt that there was turmoil in the oil industry at the time [big grin]
Of course the more modern concept of Global manufacturing has brought some of it here.
Most of the bigger brands build cars here now too, even BMW, not just Japanese brands.
Ford and GM are building "American" cars in Mexico, yet Honda and Toyota are making their cars in America?
demographic
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JonathanJung said:
Unless you live in Germany or continental Europe isnt Germany overseas as well?
What came first, consumer demand for cheaper prices or manufacturers who wanted bigger margins and profits. Add to that question the fact that without the offshore production the machines available now at relatively affordable prices simply wouldn't exist as they didn't in times gone by. My father had to build his own table saw because hobby machines were either unavailable or were too expensive but generally the former.
Crazyraceguy said:
Makita, Bosch and Metabo each "share" their batteries with other brands. That's one easy way to "expand". You can buy a gray 18V caulking gun from Cox or a blue one from Bosch; they both fit the same battery.
I hope in 10 years there is just one standard 18V connection and then the rest is relegated to niche stuff. Just like with memory cards we got from a jungle of ten different ones to basically everything SD
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