How much for that Belkin cable? Margin of 1,992%? Some "unscrupulous" tech suppliers used Brexflation in 2016 to overcharge customers with the most extreme example being a uni that coughed more than ten times the trade price for a cable. In the wake of the EU referendum, the British pound weakened against the US dollar and many manufacturers bumped up their local sales prices …
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Actually,you're right, and I've been wrong all these years...
"Profit margin is calculated with selling price (or revenue) taken as base times 100. It is the percentage of selling price that is turned into profit, whereas "profit percentage" or "markup" is the percentage of cost price that one gets as profit on top of cost price."
@tfewster didn't see the original comment, but thumbs up for looking it up!
Mathematical impossibilities aside, let's just be clear that nobody has made their millions selling a Belkin cable to public sector at 1929% markup. Let's say it's a £1.30 3m Cat6 cable, that only makes it £26.38 ex VAT sell to the customer. Now obviously that's a HUGE rip-off for what it is.....but that doesn't change the fact that it's just £26 and change.
And let's be honest...it's still got nothing on Monster cables in Currys.
I think the terms "some" and "unscrupulous" are redundant here ... remember in the free market the price is dictated by both buyer and seller ... just buy from the 'best value' (product of cost, quality and service) and be prepared to walk when the seller tries to pull a fast one.
I thought it was interesting that there is a "Society for IT Managers" that was stating this.
I've never hear of this society but it might explain a strange conversation I had in the New Zealand airport a few years ago.
As I approaching border control to enter the country two police stopped me and asked what I did for a living. At the time I described myself as an IT manager. One of them then said "What is the drug scene like for IT Managers?"
I was confused and wasn't sure how to answer. the other looked at me and said "Is there many drugs used?". I stumbled and said, confusingly "I don't know, I don't know any other IT Managers and I don't really hang around in groups of them". It seemed a bizarre question, but I guess they were just trying to trip people up and it may work for other professions.
However now I guess they were talking about the "Society for IT Managers" and what they get up to, maybe they were looking for a spy or had some intelligence on them?? Who knows, but it seems like they like to party hard.
> I thought it was interesting that there is a "Society for IT Managers" that was stating this.
Perhaps they are henchmen of the spectacularly-pretentiously-named "Worshipful Company of Information Technologists" which never fails to amuse me on the rare occasions they come out of the woodwork?
Or maybe it should be "hench-organisation"...?
3% gross margin ... and these are the same people complaining when jobs leave the country to low-cost areas etc ... How are companies supposed to operate at 3% GM? People cost money, operating cost money, marketing cost money, preparing the tenders cost money ...
This local council paid HOW MUCH for an SD card?!
I don't know - the article doesn't actually say and I couldn't find a link.
I'm sure there's some really juicy numbers in the survey - but please why not actually give at least the equivalent of they spent £#### on an Xgb card.
Bearing in mind that 100% margin is a doubling in cost price, coughing up a 1095 per cent margin on an SD memory card. is 11 times bigger than that. But on what starting price?
Devil's in the detail.
The quote is my comment on last year's version of this story and pretty much stands without needing to be modified. Either a link to the survey or some indication of actual prices paid would provide some much needed context.
Edit: The Link to the Survey (Email Registration Required) IT margins benchmarking study 2017: The avoidable cost to business
>>>>Bearing in mind that 100% margin is a doubling in cost price, <<
>>No it's not. Doubling of cost price is 50% margin.
Yep, indeed, doubling the cost is a 50% margin. It's 100% markup. The only way to get 100% margin is to sell something for money that cost you zero to purchase or obtain.
This local council paid HOW MUCH for an SD card?!
I had a friend who worked as a sales rep for the Chinese company who supplies a lot of the major MicroSD/Flash market with their products. He would often quote me prices like "Sandisc 128GB MicroSD for $3.25 CDN" or "Kingston MicroSD for $1.50 CDN". Then you go and look in the retail shops, and the same Kingston MicroSD is selling for $250 CDN.
The markups mentioned in this article are similar. It's just that now that the UK is preparing to Brexit, people want to pretend they are getting shafted because of brexit itself, not because retailers ALWAYS shaft consumers.
That article could serve as an example on how a journalist can massage numbers until they're big and scary, without providing a single reference point that would qualify it as "news".
Such as:
- what was the original price?
- overall, what's the share of the cost of those 0,5m Cat5 cables in budget prices?
- have the prices in the US and mainland EU changed too?
But no worries, I understand. While you just start to whine about having to suffer the consequences of leaving the EU, here on the mainland, people still whine about the consequence of entering the Euro, with demonstrations just as convincing.
Not in defence of gouging and outrageous markup though but sometimes the product is no different but there's an added layer that adds cost.
By way of example. The sugar industry produces pure white sugar. Pure as in 99.9 odd %. This is the stuff that you put on your cereal and in your tea.
This purity will meet Pharmaceutical grade requirements (for making cough medicines and the like) but further testing is required to show that it is really absent from heavy metals, certain bacteria and other unpleasantness. Add in this and traceability and the price goes up relative to a 1kg packet of Silver Spoon on the shelf at Morrisons.
Are any sectors paying extra for added "peace of mind" in way of certification and warranties ?
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"Are any sectors paying extra for added "peace of mind" in way of certification and warranties ?"
In the case of IT and govt./local govt bodies including the NHS etc, they are usually tied to a "framework agreement" where they can buy only what was specified at the formation of the agreement, and only from a limited list of approved suppliers. Desktops, laptops and servers are usually supplied with up to 5 years on-site warranty too. In the case of desktops, at least, just the case the PC is built in is usually a decently heavy grade of box compared to the cheap paper thin 20 quid ones you get at the local computer shop.
They also generally don't have aggressive buyers out for a good deal. They rely on the companies tendering to compete with each other to produce a good deal. Sadly, it's usually "sealed bids" so it's down to the simply taking the lowest bid rather than make the tenderers bid each down in an auction fashion.
Slightly OT, but I continue to be amazed at how much retailers will overcharge for products like cables. I had a conversation with my Dad recently - he'd needed a new USB cable for his phone, and had got on in a local shop for a couple of quid.
A few days later he'd been in a big store and seen the same sort of cable on sale for something like £15. He got in touch with me, paranoid that he'd bought something substandard and that it might damage his phone or laptop.
It took quite some time for me to get him to believe that literally the only appreciable difference between the two was the price
Upgrade my "fee" from a cupcof tea, beer or dinner to a fully catered and furnished 3 day trip away to a tropical island with martinis. Why? Well at that price my services of "turning it off and on again" are much higher srandard thancthe £300 the local IT shop charges!
@wyatt
" To an extent I agree, however when you look at how the cable is comprised there can be a number of differences. Quality of the connectors and the gauge of the wire are all factors which a cheap cable may scrimp on meaning slower charge times and other issues. "
The problem is that many pricey cables in shops are just cheap cables in a nice packet.
The only objective measure of USB cable quality is resistance on the +5V line -- a poor cable will have a higher resistance, meaning slower charging. Funnily enough, even though I own a multimeter, I've never checked my cables for this... must start doing so.
I on the other hand would rather not spend several hours faffing around trying to fix a problem only to discover it was due to an intermittent fault in a dodgy cable. Call that a subjective measure of quality but it's important to me. In fact I have a general rule: software's buggy enough as it is without the additional complication of random hardware failure so paying a bit extra for known good hardware is money well spent.
Of course, cables are a bit of a special problem. With the exception of that Google guy they're not something people tend to review. Then again there was a time that was true of PSUs.
I don't pay £15 for a micro USB cable, but I don't buy cheap ones either now. I have so many that I have where you have to hold it at a certain angle using a nearby wall or book to get the connector to charge, or the connector just doesn't seem to snap in cleanly. Therefore I buy ones for about £6 off amazon that are well made and have good reviews, these have been fine.
microUSB was designed so that the connector on the cable is sacrificial, rather than the device.
this is why, generally, your four year old Android phone's microUSB port is still working, even if you're on your third cable.
then you can feel sorry for all those iphone owners whose lightning port doesn't work too well because the contacts have lost their springs, and buying a new cable won't help them.
I went into a computer shop to get a USB cable as I had bought a wireless printer, which naturally didn't come with a USB cable (wireless, innit?) but needed one once for the initial setup. I was fully expecting to pay about a quarter again the price of the printer, as I didn't have time to wait for a £1 one from an Amazon trader or fleabay.
So imagine my surprise when instead of pulling out some nicely labelled oversized bag, the guy in the shop pulled a slightly battered cardboard box out from under the counter, shuffled around, pulled out a cable in cheap cellophane and asked "Will that do?"
I can't remember what he charged me for it, but he instantly became my first recommendation for computer repairs.
A) because he was honest enough that I wouldn't expect him to fleece customers
B) because he clearly had a successful enough business that he didn't feel the need to fleece customers on the day-to-day stuff.
It took quite some time for me to get him to believe that literally the only appreciable difference between the two was the price
Was there a difference is amp's ? Some cables can only carry 1 amp max, others 1.5 or 2 amps. If your dad has a high grade charger that can deliver 2 or more amps, then his cable will get "quite warm" and wear out sooner ...
@Hans 1
If your dad has a high grade charger that can deliver 2 or more amps, then his cable will get "quite warm" and wear out sooner ...
I've often wondered about this. Say you buy a "quality" US-made cable and connect it to a cheap Far Eastern charger. Aren't you replacing the good American electrons in the cable with anemic Far Eastern electrons?
These are the sort of things that keep me awake at night.
"for example, the purchase actually being a pack of 100 but logged as a single item."
This is a constant problem at $EMPLOYER. Twats in various departments insist on ordering 1 or 2 ethernet cables at £1 each (or less), despite being repeatedly told that the _internal_ costs of raising orders means that anything less than £20 is not economic - and the suppliers have responded to the abuse by padding prices across the board to take shipping into account, which means when I order £200 pounds worth of cables it can now cost £450.
And yet procurement thinks this is alright.....
It's not that strange that some individual prices may be way out there for very plausible reasons, looking at the max values are usually not a good idea rather look at 95 or with a large enough sample set 99% values for this kind of things..
Say you are a hospital with your nice shiny nmr or other expensive piece of kit that need that sd card, assume that it's speced to use a specific kind of milspec sd card that is not readily available, then you may well think it fine to have a courier to pick it up at the us manufacturer and jump on the quickest plane available to get it to you rather then having the machine unavailable. Of course then the price you pay will be through the nose.
So prior to Brexit, $:£ was 1:1.48 , currently 1:1.30
Current cost per F35C is $122.8m , UK is buying 138, total is $16,946.400,000
Before Brexit, cost £11,607,123,287
Now, £13,035,699,051
Difference: £1,428,575,764
So £1.4bn cost increase, and that's just the flyaway cost, without maintenance that has to be done in Turkey, or training, or parts etc. So that's 4 weeks of the NHS's alleged extra £350m per week down the drain, along with 3 warships and 1000 marine's jobs.
This is how the world works.
I'm a purchaser for <insert government financed entity> and I talk to lots of suppliers about what I need.
I now have a choice, do I spend someone else's money on the cheapest or do I spend it with whoever is going to give the biggest kick back for me and my boss?
Sad but true and it won't change until there is full transparency throughout government from the bottom right up to the top.
now have a choice, do I spend someone else's money on the cheapest or do I buy from my usual supplier, which make my life easy, which I defend by using spurious arguments about "authorised suppliers" so that I don't have to work at getting the best deal. FTFY
And I have the experiences to back this up. I used to buy our kit myself, identifying the best product, investigating tco and sourcing the best possible deal. Then the local authority we were part of went all corporate. We had to use their supply manager, who had no idea of total cost of ownership, always "recommended" the same manufacturers ( we had no choice but to accept - usually the likes of HP) always bought from the same supplier. (ironically one we had been banned from going to ourselves at the start of this process) and usually at a much higher price than I could get it myself, but also with a percentage fee added to pay for the internal " procurement services." And delivery used to take an age, when I could usually get the kit in a day or two.
"I could usually get the kit in a day or two."
The problem there is a that "a few bad apples spoil the whole barrel". Most people are honest, like you, but all it takes is one stupid twat to pay over the odds to a friend or family members and suddenly there are knee jerk reactions and new procedures put in place to stop it. The long term costs overall probably add up to more than the fraud they've stopped. Personally, I'd have thought that leaving the honest people to get on with their jobs with the occasional audit to spot the fraudsters would be a lot cheaper.
John Brown (no body) There's quite a lot of that and as far as I can see, not just in the public sector. Laborious and complex time allocation sheets to show that you are working fully during the day, that take longer to fill out than the odd ten minutes a few people might skive if they could get away with it. But which decent management relationships could make irrelevant instantly. Or casual car use mileage claim sheets that are so detailed and cumbersome to complete and return that they cost more in wasted staff time to complete than they save in preventing small amounts of inaccuracy or petty fiddling. And so on.
In all these cases efficient management and trusting staff the is the most cost effective arrangement. It's just one that bean counters don't understand. I did once come across a case of real fiddling, in the office next door to us. But the very junior staff member who had been doing the fiddling had been left to it by his rather senior manager who had never bothered to check the expenditure and the purchasing orders he was authorising.
It's time that we faced the reality of the nonsense and chaos that's going on and cancelled our exit from Europe (the stupidly-named "Brexit"). It's clear to the meanest intelligence (now)* that it's going to isolate us in our nice little poorhouse ghetto - such a pity that the double-first graduate who got us into this mess couldn't specify a minimum 60% agreement to exit rather than the unbelievably stupid 50/50. Duh.
* And I say "now" because it was mean intelligence (i.e. morons who hadn't a clue what they were voting for, as in "I didn't want to support Cameron") that got us into this appalling mess.
"I can't get my head around this. Why does an organisation that rivals the PRC Army in size pay over the odds for everything, especially drugs? It should have massive purchasing power."
The NHS doesn't pay over the odds for drugs, generally - quite the opposite actually, with one of the many "advantages" of Brexit being a likely increase in the average price of drugs across Europe as the NHS loses bargaining power and currently is something of a price-setter for the European market.
Where does the NHS get ripped off the worst? PFI contracts, obviously, where it's tied in to a service provider and it'll cost more in lawyers and consultants to do anything but accept paying through the nose.
If you look at the prices of drugs on the British National Formulary, and compare them to what is typically charged in the US, then it is way cheaper for the NHS usually.
Where the NHS overpays is for over the counter drugs, such as paracetamol. I can get a pack of 16 in Asda for 19p, whereas the NHS would pay a lot more proportionately for larger packs.
@Katrinab
Okay, so your 19p Paracetamol v NHS paracetamol. First off, you have the quality of the tablet, then you have the assurance that the stated dose is correct.
A few years back, a hospital decided to cut costs by purchasing cheaper paracetamol, much as you suggest. They then found they had a high crumble rate to the tablet meaning they couldn't give them to patients meaning they were having to bin over half the tablets as unusable (when a tablet crumbles, the dosage becomes an unknown and that's not permitted in patient care). So the more expensive tablets, which didn't crumble as easily, were cheaper in the end due to lower wastage.
The problem with the dosing was highlighted when some cheaper paracetamol tablets were found to vary in dosage by more than the accepted ammount (I don't have the figures as to what these are, but it was another reason given for why a more expensive tablet was preferred).
So 19p boxes of paracetamol from Asda might be fine for self prescription, but not for an NHS prescription. This is why you're only prescribed paracetamol in dosages greater than over the counter amounts, and why the tablets are higher dosage than you can buy over the counter: They're also a higher quality tablet.
That doesn't mean hospitals aren't ripped off on drug costs, however, it just means that comparing self-prescribed medication to NHS prescribed doesn't work due to different rules over quality.
Years back I had to source a 2m SCSI cable for a scanner; the above only had 0.5m in stock for £28; they would ORDER a 2m cable, but wouldnt give me a price.
I needed it in a hurry, so drove 5 miles to a computer fair, where a 2m cable (still in use today*) cost me £8.
* Still in use because, although the scanner barely works with WinXP, it is the BEST scanner I have ever come across - and built like a nuclear bunker.
(The most modern driver for it was Win98SE).
No, it is an Epson; the model number has rubbed off, but I think it was a 6500 ?? We got the first one with our first Win95 office box.
I had two*, with the slide/negative adapters; to this day it is as fast at standard dpi speeds than my Epson Workforce AIO, or any of the newer, dedicated scanners I have lying around.
For day to day, I use the Workforce (because it has an auto-feed system), but for photos I use the old one, as the colour correction is better.
*My sister broke the one - god knows how; probably yelled at it; the same way she yelled at her PC and killed the HDD.
I ask because I had (only disposed of last year) an old scsi HP Scanjet which worked for about 20 years solidly and was as fast, if not faster than a shed load of modern scanners. The resolution it could achieve was astonishing. But for an A4 scanner it was huge. So attached to it I became, when I upgraded to a p4 800fsb I bought the gigabyte titan MB which had scsi on board so I knew I could carry on with that exact scanner.
I did a lot of scanning back then....
when a pot hole costs you £1.8m.
http://www.bbc.co.uk/news/uk-england-somerset-41523751
Cost of filling in pothole £842 **
Cost of not filling in pothole £1.8m compo; 38 days annual holiday, 11+ days "sick leave", 42 Fridays off for flexitime, and a gold plated pension all for the manager..
** 6 workmen, 5 to stand around for hours until a colleague finally bangs £2 worth of tarmac back in the hole.
Bought a couple bulk boxes of cable (solid copper, not rubbish copper-clad aluminum cable that work-hardens and fails a year later), a giant sack of RJ45 connectors, and a cheapo set of cutters/strippers/crimpers.
2000 feet of cable -- ~$110
1000 connectors -- $23
tolerably reliable tools -- $25
Basically set for a few years. Prices in USD
Based on those prices, sounds like you got solid wire, and connectors for stranded. Those connectors will fail with breaks in the copper over time -- even heat expansion/contraction will be enough, without even introducing vibration or cable movement.
There are reasons why we use stranded wire for patch cables, and why special RJ45 connectors for solid wire exist.
When I was in the networking biz, i was informed that the cost of the cable is insignificant, compared to the cost of installing it.
I would wager, having terminated more than a few RJ45 cables, that the cost of (correctly!) installing connectors on each end, dwarfs the cost of the cable in between.
Oh, and RJ45 connectors are designed for solid copper wire, as almost all telephone wire (in the US at least) is solid (26AWG?) wire. The ones for stranded wire are the "special" ones.
"When I was in the networking biz, i was informed that the cost of the cable is insignificant, compared to the cost of installing it."
Pretty much. It costs about 10% more to run two network sockets to each desired location as it does for one. On that basis we always look at the number of points we think are needed, double it and double it again. So far all we've learned is that we never ordered enough network sockets (although ubquitous wifi is making the demand for more network ports start to plateau)
In the meantime the building services people think that an acceptable number is one per desk, at 100MB/s with an IP phone plugged into it.
English, 2017
1. To use Brexit as a cover or fallacious reason to gain advantage politically, socially or financially. Usage: "In an act of shameless brexploitation, Belkin blamed Brexit-related currency fluctuations when raising the prices of their cabling products in the United Kingdom" (See also: Tony Blair, Nigel Farage)
2. Using the danger and costs of a departure from the European Union to instill a general level of anxiety in either a British or European population to forestall or curtail public debate (See: Jean-Claude Juncker)
3. To exploit Brexit to get a new word added to the English and various European languages (e.g. "le Brexploitatione") in pursuit of a dubious claim of payment due by the Oxford English Dictionary and other linguistic references. (See: Marketing Hack)
Only two weeks ago, I popped into PC world out of boredom (the other half at next door Currys) and saw a Belkin USb cable for £19.99, conveniently placed where they sold printers ! Mind, they sell printer cables separately, whereas before they would be included in the box. They make it a point to highlight this with a sticker too. Was so disgusted that I didnt even muster up the courage to confront the sales bod (who was loitering aimlessly) with a question about pricing strategy and justifications. He wouldnt even have known the answer. Usually, I like to remind them the price in poundland is err... a pound.
I once picked up a 10 metres length of Cat5 network cable for a pound in, you guessed it, Poundland. And it was a fully loaded and fancifully packed Belking brand. Still use it today.
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