Sawstop price increase

[NVA_WW]

I just received an e-mail from my local Woodcraft where they mentioned a Sawstop price increase. I did a quick search online but found no additional information.  I’m looking at their outfeed table and this might push me to purchase it. I’m sure we will also see the customary Festool increase announcement soon.

 

[Grev]

Yep ... I received an email about the price increase and confirmed it with my Wurth rep. .. Takes effect the end of the month.  No info. on how much yet though? 

 

[Gregor]

They have been bought by TTS, hence a yearly price hike is not surprising but has to be expected from now on... isn't it?

 

[RKA]

The outfeed table is going from $299 to $349 (page 29).  I think many of the other accessories are going up similarly.

For reference in case others are interested, the saws don’t seem to be going up as dramatically.  A PCS36 3hp 36” will being going from $2899 to $3049 (about 5%).  $250 for shipping remains unchanged (page 27).

The 2019 Grizzly catalog has the new prices (effective 2/1/19) listed.
http://cdn0.grizzly.com/catalog/2019/main/2019_Grizzly_Main_Catalog_Web.pdf

If the direct link above doesn’t work, use this...
http://www.grizzly.com/catalogs

 

[mcooley]

Indeed, one of the most discouraging aspects of Festool and buying into the system which are these annual price increases. I posted earlier we should expect this for the Shaper Origin now. I'd sure like to see more options and competition by others. I think the Domino 500 patent is expired or close to expiring, no? Maybe Festool should do a "pro-line" guarantee that all price hikes be kept to 3 year cycles? Of course, you'd have to pay some kind of annual membership but if they really want to continue with yearly price increases then at least this might encourage the more regular users to feel less pressure. They keep marketing how small shops use their products so keeping us on board would be in line with their current messaging. On the other hand, at least the recon sales are regular occurrences now without the "get on the list" issue from before etc. 

 

[peter halle]

Just for clarification - Festool and Sawstop are not the same company.  They might fall under the same company umbrella.  There are plenty of other corporations that have numerous companies and each has their own pricing structure.

But as a side note, last year by this time we had already heard about any prices increases here in North America.  Wonder why we haven't yet?

Peter

 

[ChuckM]

I don't quite understand why people don't complain about yearly salary increases, but whine about price increases for anything else. Inflation is a fact of life in normal times, and so is the yearly pressure on merchants to raise prices. If merchants don't raise their prices, where do they find the extra money to award bonuses or annual wage adjustments? From their own pockets?

 

[kevinculle]

In the first 4 years of this decade it took roughly $1.35 to buy a Euro, then fairly abruptly the exchange rate dropped to about $1.10 to the Euro and stayed there for about 3 years.  Festool is a German company operating in Euros, so all of a sudden they were getting about 22% more Euros for every tool they sold in the USA.  Do you remember Festool cutting their USA prices to respond to this economic change?  Me neither.  The Festool annual price increases have little to do with fundamental economics and everything to do with the irrational pricing that buyers of luxury goods accept.  Buyers of luxury goods want exclusivity and a visible reminder of their status, real or perceived.  So higher prices are a draw for these buyers.

 

[blaszcsj]

Keep in mind that there are tariffs on steel an aluminum goods. I work at a machine tool company and we can’t even get quotes good for more than 24 hrs. Prices across the board have risen dramatically in the last 6-8 mo.

 

[Scorpion]

I don't quite understand why people don't complain about yearly salary increases, but whine about price increases for anything else. Inflation is a fact of life in normal times, and so is the yearly pressure on merchants to raise prices. If merchants don't raise their prices, where do they find the extra money to award bonuses or annual wage adjustments? From their own pockets?

I don’t think anyone would complain if their salary increased annually at the rate Festool raises their product prices.  In general, wage increases are less than inflation anyway.  In contrast to Festool price inflation, way less. 

Second statement confuses me greatly.  When referring to a merchant or corporation, what does “their own pockets” mean?  Did you mean profit margins, investor earnings, executive bonuses, etc?  This is all a money game and the game is only to make more.  Companies have expenses and typically a strategy for earnings growth thats always stated in terms of “compared to last year”.  Yes they’ll raise prices to compensate for a rise in expenses but typically it’s trivial in proportion to the raise to meet their revenue growth goals. 

If they chose to not raise prices this year, that would only mean they found another way to make up the difference - out sourcing, production optimization, reduction in R&D, etc.

Now, in the same breathe, if we do continue to support the price increases we can hope that Festool will continue to invest in R&D and new product development which could translate back into efficiency and productivity gains for us...

 

[ChuckM]

Snip.

I don’t think anyone would complain if their salary increased annually at the rate Festool raises their product prices.  In general, wage increases are less than inflation anyway.  In contrast to Festool price inflation, way less. 

Second statement confuses me greatly.  When referring to a merchant or corporation, what does “their own pockets” mean? 

Inflation is only one of the factors affecting price increases. Any profit-maximizing business will increase prices to a level that it can get away with, that is, as much as the market allows. Festool has been able to push up prices because the demand is there to support them. All this despite the competition it has to confront.

By their own pockets, I mean price increases are part of the approved budget plans. If the proposed price increases are reduced, something has to give to maintain the kind of salary increases awarded. The profits are the pockets. Remember profits may be just a number to the consumers, but they are one of the success yardsticks that the leaders of a business are judged against. It is easy for us to say the profits are large enough and can be a little lower (in the form of lower price increases, for instance), but the hands of those managing the business are usually tied.

The simplest solution to me about price increases is do the homework and get a competitive or comparable product at the price that I am happy with.

 

[DeformedTree]

The price of a product is a very complex thing, big picture no company could ever generate and answer to how much it cost to make product X or where the price comes form.  You simply can't split out NRE, labor, facility cost, etc as so much is shared across the company and amorotized based on an initial sales number guess.  So in the end, the prices are effectively made up.  What controls it in the end is the feedback loop from sales.  If price goes up and sales continue the same, then the new price is fine. If price goes up and sales continue to increase, then the product was definitly under-priced.  If sales tank, then they will adjust (maybe).

So much of the issues around the world are due to way to much stuff being sold way too cheap.  Just means farmed out labor and bad labor practices, and continued quality slip. No one wins.  Sustain prices, sustain quality, sustain good jobs.

Does that mean everything a company like Festool does is good, or that all their quality is good, heck no.  But I don't want to see continue loss of companies making good tools (among other things).  A lot of Festool stuff is overpriced, but then you start trying to work thru other options, and while cheaper they may be junk, or made in places you don't like, etc.  Also folks just generally underestimate how much stuff should cost. 590USD for a TS55 sounds high at first, but when you figure where it's made verses others and what it is verses other tools, it's more in line with what tools should be.  Sure there is a 99 dollar Milwaukee at hd.  But that's not a plunge saw, track saw, has no real features at all, is made in China (not attacking China, just a matter it's made there to save labor cost) and sold at a store with minimal profit margin.

Companies that stay around and continue to make products people want have price increases.  Unless something about what goes in the product is in a continually price reduction (computer/chip industry components), prices will steadily shift up.  Also when companies get bought by someone else, price increases almost always happen.  You have more management layers and the company needs to get it's money back. Plus it often was bought because they were under pricing their products (making less money than they could), so the new owners seized on that.

Look at things that Festool makes that folks say is over priced, then look at those who try too "make their own" and so forth.  Sure an MFT/3 is a very over priced table.  Yet try making the exact same thing on your own for less. You won't.

 

[Scorpion]

Snip.

I don’t think anyone would complain if their salary increased annually at the rate Festool raises their product prices.  In general, wage increases are less than inflation anyway.  In contrast to Festool price inflation, way less. 

Second statement confuses me greatly.  When referring to a merchant or corporation, what does “their own pockets” mean? 

Inflation is only one of the factors affecting price increases. Any profit-maximizing business will increase prices to a level that it can get away with, that is, as much as the market allows. Festool has been able to push up prices because the demand is there to support them. All this despite the competition it has to confront.

By their own pockets, I mean price increases are part of the approved budget plans. If the proposed price increases are reduced, something has to give to maintain the kind of salary increases awarded. The profits are the pockets. Remember profits may be just a number to the consumers, but they are one of the success yardsticks that the leaders of a business are judged against. It is easy for us to say the profits are large enough and can be a little lower (in the form of lower price increases, for instance), but the hands of those managing the business are usually tied.

The simplest solution to me about price increases is do the homework and get a competitive or comparable product at the price that I am happy with.

Completely agree.  Problem is, there isn’t a comparable product the is as available (generally) and once you go all in on “they system”, you’re fundamentally vendor-locked unless you’re willing to go through the effort and cost to switch...it may end up being cheaper to live with the price increases.

 

[mavrick1903]

I’ve seen the notice they sent to the Woodcraft’s. Sawstop states it will not be annual. Also, this is the first increase they’ve had since they started.

Sent from my iPhone using Tapatalk

 

[Cheese]

Keep in mind that there are tariffs on steel an aluminum goods. I work at a machine tool company and we can’t even get quotes good for more than 24 hrs. Prices across the board have risen dramatically in the last 6-8 mo.

Here's a great article on the subject. They're quoting material lead times of 18-20 weeks...just for the material. [eek]
https://www.mscdirect.com/betterMRO/metalworking/how-future-proof-your-business-tariff-fallout

 

[blaszcsj]

TKO, INA, Timken lead times on products have gone to 22-56 weeks in the last year. Lead times are not expected to get better for at least a 1-1.5 years. It is mind boggling what the recession did to manufacturing across the board and what happens when a boom hits after.

Keep in mind that there are tariffs on steel an aluminum goods. I work at a machine tool company and we can’t even get quotes good for more than 24 hrs. Prices across the board have risen dramatically in the last 6-8 mo.

Here's a great article on the subject. They're quoting material lead times of 18-20 weeks...just for the material. [eek]
https://www.mscdirect.com/betterMRO/metalworking/how-future-proof-your-business-tariff-fallout

 

[fernando2014]

Not such a bad thing though when you can sell your tool for the same price or more than what you paid for it 10 years ago.... Makes having festool products a pretty good investment I think!