How does the price of a knife go up so high?

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rxq

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May 19, 2009
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How does the price of a knife go up so high, past $100usd?

Do they have high production costs? Or is it just a mark up?
 
I think it has to do with what type of steel is used and labor costs. American made versus Chinese made. A larger established knife company may be able to produce a very nice knife at a lower price compared to a smaller maker. Kershaw puts out some really good knives at good prices and most are made in USA. If you shop around you may find that $100.00 knife for $ 65.00.
 
A lot of the cost has to do with the machining more than the materials, though good materials obviously cost more. Another thing with good steel is that it is often more difficult or complicated to work with rather than simply just costing more.
 
Because people will pay extra for the privilege of owning that specific knife - and the owners of lesser knives therefore fall into the ranks of untermench, doomed to forever tug at their pocket in complete subjection.


At least, that's what I get from the writings of some fanboys.
 
I think it's interesting to look at MSRP prices compared to "actual" prices. Often times what a knife is listed for on the manufacturer's site is 2-3X the price you can actually buy it for at a dealer or supplier somewhere else.

For example I have a knife that is MSRP $74.99. I bought it (including shipping) for under $45 on Amazon.com brand new.

It's a fixed blade knife, with a Kraton/rubber handle, and a Kydex/plastic sheath. Nothing revolutionary, a slab of Aus8 steel sharpened on one end, a rubber grip molded on, and a sheath stamped out and pinned together around the edges. Done. I can't see how it would cost anywhere near $75 to make, or even $45. I'd think more along the $25 mark, and probably even less considering they get the materials in bulk and mass produce these. I believe most brands are making bank on mass produced knives...but that is nothing out of the ordinary and has been going on for years.
 
There are many costs outside of labor, materials and taxes.
Profit is the cost today of doing business tomorrow.
And businesses want to be around tomorrow.
 
A lot of the brands are massively over priced on the MSRP. It allows the company maintain a preminum brand status and the sellers to look good when they knock off 40-50%.

Also most companies are really importers or rebranders, so that adds a bit.

On things like autos, etc.... it's the niche market/small production + sin tax that adds a good amount...........:).
 
Price is determined by what people are willing to pay for it - not any other factor.

If it costs you $100 to make something but people are only willing to pay $50 - you are doing something wrong.
 
MSRP isn't designed to sell knives. Selling knives at MSRP allows the dealer to keep a very nice piece of a brick and mortar store, as well as keeping all knives in stock. In the online age, that just simply isn't how it works. No one, not even the company, is expecting people to pay full MSRP for a knife, just like the car dealer isn't going to expect you to pay full sticker price on a new car.

A lot of costs aren't in producing the actual knife, but designing it. FRN and other plastics need molds. Molds cost anywhere from $250,000 to $3,000,000 depending on how intricate the pattern is. The design of the knife, setting up stamps, lasers, heat treats, etc all add to the cost.

Sure that slab of AUS-8 may only cost $25 in materials, but then you have to take those materials, shape it (lasers), run it through a grinder (belts and discs), heat treat (heating costs and time), add the handle (molds), package and ship. That's also not taking into account the overhead of the company, it's employees and benefits, and marketing costs.

People get used to buying $5 knives that are made from pot metal in china and start wondering why a much better knife costs more.
 
dextersp1 said:
Price is determined by what people are willing to pay for it - not any other factor.

If it costs you $100 to make something but people are only willing to pay $50 - you are doing something wrong.
Click to expand...

That's what happened with the Spyderco T-Mag I believe. It's sad because it's a wonderful knife. The demand just wasn't there.
 
Cost is only a small portion of ANY non-commodity product. Actual cost dictates the lower limit of the price, but there's no limit going upward. Any company worth its salt will price their products based on how much the market is willing to pay (demand) at what production quantity (supply) within a certain amount of time. A knife might cost $10, but if the market is willing to pay $200 for it, then the company WILL price it at $200. If the company for whatever reason chooses to price it at $50, end users will still pay $200; dealers will pocket the $150.

There's an entire academic discipline covering this subject; it's called Marketing.
 
Josh K said:
Sure that slab of AUS-8 may only cost $25 in materials, but then you have to take those materials, shape it (lasers), run it through a grinder (belts and discs), heat treat (heating costs and time), add the handle (molds), package and ship. That's also not taking into account the overhead of the company, it's employees and benefits, and marketing costs.

People get used to buying $5 knives that are made from pot metal in china and start wondering why a much better knife costs more.
Click to expand...

I hadn't thought of shipping them out and overhead costs. I'd be a terrible business man. :p
 
Kinda like Rolex. They are expensive as hell but people are lining up to buy them.
 
one thing that can be said about higher grade materials is many times they are much harder to work with, like Titanium vs. Aluminum. Many of the so called super steels are much more harder on equipment than softer old school steels. I like to think that one change in a knife design or materials acts as a domino effect into all other areas. If you upgrade the steel and you start burning up cutting bits faster right there is more money that needs to be compensated for. But in the end this doesnt mean that there are certain companies that overprice there product to the point of me just not even wanting to pick one up.
 
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