How do they justify the price of the LCR?

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TRanger

Blackhawk
Joined
Mar 7, 2007
Messages
799
Location
Florida
I had an opportunity to examine the LCR the other day. A co-worket had purchased it as an off-duty/back-up gun. Its disassembly is rather simple and after examining the gun's components, design, and fitting of the parts; I cannot see how Ruger justifies the suggested retail price of $525.00. (My friend actually paid about $100.00 less for his.) The revolver's polymer frame is simply a molded component containing the fire control parts, which are assembled therein without any fitting. The cylinder and barrel sleeve are installed in the aluminum mainframe with what appears to be little or no fitting as well. Add the rubber stock and pinned front sight and that's about it. The revolver may be a remarkable design from the standpoint of efficient manufacture. It seems rugged enough for its intended purpose. But I simply can't see the price. I suppose they need to recover the costs of development, but it can't possibly cost much to manufacture this weapon. I'd say a reasonable retail price for it would be about $250.00. I'd guess it doesn't cost much more than a third of that figure to build it. I understand prices are determined by what the market will bear and lightweight .38s are popular items right now. But the gun simply doesn't appear to be worth the price asked by a long shot. Those of you who are involved in manufacturing may be able to explain the cost, but I have a hard time seeing it. I note that the Blackhawk and New Vaquero appear much more complicated to manufacture, but can actually be bought for less money.
 

stare-decisis

Single-Sixer
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Jul 14, 2009
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Northern Lower MI
I note that the Blackhawk and New Vaquero appear much more complicated to manufacture, but can actually be bought for less money.


and lightweight .38s are popular items right now.
You answered part of your own question. Not much demand for BH and Vaquero so price has to be lower. Charge more for the LCR because as you admit, 38's in our expanding CCW in US are very popular. And they have a patent for the new technology used for the trigger. I'm sure that costs more for development than one thinks. At to that Rugers are made in US where labor costs are more...
 

TRanger

Blackhawk
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Messages
799
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Florida
stare-decisis":3nxlh7w9 said:
I note that the Blackhawk and New Vaquero appear much more complicated to manufacture, but can actually be bought for less money.


and lightweight .38s are popular items right now.
You answered part of your own question. Not much demand for BH and Vaquero so price has to be lower. Charge more for the LCR because as you admit, 38's in our expanding CCW in US are very popular. And they have a patent for the new technology used for the trigger. I'm sure that costs more for development than one thinks. At to that Rugers are made in US where labor costs are more...

I understand the issue of demand. As far as labor costs, there can't be much labor involved in building the thing. It appears specifically designed to keep labor costs to an absolute minimum.
 

trouble

Single-Sixer
Joined
Aug 31, 2006
Messages
261
Location
Va
Good question, I handled one about a month ago and frankly was disappointed by it's quality and feel. Very unRuger like, I'll keep my SP101 thanks!
 

patcannon

Single-Sixer
Joined
Aug 5, 2006
Messages
110
Location
Minneapolis
It's how all prices are justified: the market. As you yourself pointed out, the real price is about $100 less than MSRP, except for people who are in a hurry to get one and have extra money lying around.

I was just looking at some of the videos on Ruger's web site and it was mentioned in one of them that this is the first weapon they've produced that requires no hand fitting. So I think, once R&D costs are recovered, this could be a very profitable item for them, even if the price comes down more -- which I bet it will.
 

AzRebel

Single-Sixer
Joined
Apr 24, 2006
Messages
216
Location
Next to the creek, under a pine
Sorta reminds me of a story I heard once, many years ago.

Seems there was a lady who's TV stopped working, so she called the repairman. He came in, looked the TV over, and thumped the side of the TV with his hand.

The TV started working, and he charged here $76. She couldn't believe that he was charging so much to just hit the TV with his hand, so he explained....

He was only charging her $1 for hitting the side of the TV. The other $75 was for knowing where and how hard to hit it.

Same concept applies. If someone can design a better (??) revolver, make it with a minimum of cost, and sell it for big $$ that result in a huge profit, there's really no reason to sell it for less. Of course, the market sets the price, so if it doesn't sell then they'd have to lower the price some or quit making them.

There's always a risk.

Daryl
 

kimberguy2004

Bearcat
Joined
Apr 20, 2004
Messages
23
The market will determie what it sells for.. Eventully.. The botom line is.. If you don't like the fit or feel, don't buy it. I'm sure Ruger will listen..I bet the cost is going to come way down.
 

BlkHawk73

Hunter
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Dec 30, 1999
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4,424
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Maine
I understand the issue of demand. As far as labor costs, there can't be much labor involved in building the thing. It appears specifically designed to keep labor costs to an absolute minimum

Still have the labor for the tooling, molding, parts manufacturing, assembly, etc. Just like the other models someone has to assemble all those parts.
Gotta stop looking so deeply at these aspects and simply decide of the asking price of your dealer is worth it to you. Analizing it so much and you can convince yourself everything is overpriced.
 

CraigC

Hawkeye
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May 27, 2002
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5,197
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West Tennessee
BlkHawk73":1c6cadxz said:
Gotta stop looking so deeply at these aspects and simply decide of the asking price of your dealer is worth it to you. Analizing it so much and you can convince yourself everything is overpriced.
Exactly!

Don't know why but everybody assumes that a polymer frame makes the gun cheap to build. Setting up for injection molding is extremely expensive and it can take years to recoup the costs. Add to that the R&D to engineer such a revolutionary design. All that and it comes out cheaper than a comparble S&W. I'd say that's not bad at all. Hell, a new Single Six that has not changed in 36yrs comes out to $400 anywhere.
 
A

Anonymous

How does Smith and Wesson justify the cost of ANY of their guns? It's only because of the logo they stamp on them, not because they're actually worth more or cost more to make. Plus they set the MSRP knowing damn well that most people aren't going to pay THAT much.

It's just like when I sell old crap on ebay. I always set a "buy it now" price of more than what I think the item is worth. If someone wants to buy it now, I'm happy to take their money...
 

ranger7

Bearcat
Joined
Aug 23, 2008
Messages
25
+1 on the initial costs of injection molding.

Compared to most of the other guns out there, I find the LCR priced fairly. If you look at some others (when they first came out) like Seecamp and Rohrbaugh, for example, the LCR is a downright bargain.
 

WESHOOT2

Hunter
Joined
Mar 19, 2005
Messages
2,124
Location
Duxbury, Vermont, USA
In this country profit is not disallowed; it is a good thing.

Anyone here work for free?
Anyone think they're paid too much?


I was once asked what I thought was a "fair" profit, and I replyed "800%".
When asked how and why I'd picked that number, I simply stated that's how much I'd like to make.....ay?
 

StanMemTn

Single-Sixer
Joined
Feb 3, 2009
Messages
214
Location
Memphis, TN
Also, I very much doubt that Ruger designed and built the LCR BEFORE deciding on a price. I'm sure at several points along the way they determined what the approximate selling price would be to justify the amount of resources being put into development.
Like many manufactured goods, I'm sure they figured out the selling price and expected % profit first, then set tolerances accordingly.

-Stephen
 

steveodtw

Blackhawk
Joined
Jan 16, 2009
Messages
979
Location
SE Michigan
I believe they set out to design a new revolver targeted to be better and lower priced than SW. That's where they priced it. The trick is then how many do you have to sell at that price to be able to afford to build it, while covering development and ongoing costs, and make the desired profit level. That's what caused the demise of the Gold Label SXS shotgun (opinion). Never could get the costs down below hand fitted guns.

If they claimed an evolutionary revolver with the most advanced design and materials in the industry, including a great DA trigger, and said it only cost $250, would you buy it, and stake your life on it?
 

Redhawk4

Single-Sixer
Joined
Nov 3, 2008
Messages
124
Location
UT
Ultimately, how they justify the price is that people are buying them and demand, at the prices they are selling for is high. When launching a product there has to be a minimum viable price to justify making the product, but usually the price is set based on what people will pay, given the merits of the product and it's competition. For some products this is close to the minimum, on some its several times the minimum. Value is decided by the customer, not by how much it costs to make the product. Pricing something too low, can have a negative affect, as another poster pointed out, if the LCR cost $200 people would assume it wasn't any good.

Other factors to consider are:

Injection mold tools are very expensive, the types of polymers used in engineering applications are also very abrasive and so firstly wear is encountered and the tool has to be refurbished regulalrly. By using the hardest and most durable metals in the manufacture of the mold tool to resist wear, it's initial cost is much higher. Molded items often cost pennies in terms of the material used and the ease with which they can be produced, but when you factor in the cost of a tool that produces X units before it needs to be replaced or refurbished, and the cost of the injection molding machine with the associated wear and tear the actual cost shoots (no pun intended) up dramatically. This is volume related as well imagine what the cost to make just 100 LCR's would be. Initially you have to use a sales projection to evaluate these costs, nothing is a guaranteed runaway success so the company is taking a gamble as well, the cost of products that didn't make production or were a failure have to be recovered too so this also reflected in product pricing.

The marketing costs of a new product are also high, look how many ads are/have been running for the LCR, creating demand for a new product is expensive.

With a new product there will usually be some production hiccups that increase costs and then there could be the dreaded recall.

All the associated costs are built into the product. Some products never reach production because when the cost of production is evaluated relative to expected sales, it cannot be produced for a price that would make it competative. That's why we see prototypes of products and hear rumors of products that we never ever see for sale.

So for the moment the LCR is priced at what the market will bare and still allow for a high sales volume, over time demand will lessen and as costs are recouped it will get cheaper in real terms.
 

gunslinger_h

Blackhawk
Joined
Sep 13, 2008
Messages
981
Location
Louisiana
Personally, I do not care for the new Ruger handgun, but when you consider that the retail for an S&W model 29 is around $1100 I believe, I don't think that the Ruger is overpriced. For myself, any price for it is too much, but that does not make it a bad weapon. I do not know and will never know unless someone is shooting one at me.lol Hank.
 

darkwater67

Single-Sixer
Joined
Aug 7, 2009
Messages
141
An added cost that no one seems to have mentioned so far is the excise tax. Manufacturers are subject to the following excise taxes:

Pistols and Revolvers
10% of sale price

Other Firearms and Ammunition
11% of sale price

If you combine that with federal and state corporate income taxes they might pay on their markup, and any interest paid on money borrowed to fund the upfront costs, such soft costs get expensive in a hurry.
 
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