Every once in awhile we get an email that asks a question so universal that it needs to be answered on the site in the form of “Ask SSD.” Since the subject of this “Ask SSD” comes up over and over again in the comments section, we thought we’d address it here as a stand alone article.
Right up front, we’ve got to acknowledge manufacturing costs, particularly here in the US as the most significant contributor to sales price. Special fabrics, construction techniques, and innovation, cost money. It’s that simple. But, there’s also another issue afoot; one that is not well known and that’s what we’ll concentrate on today.
Often, that issue is government pricing. While we won’t go so far as to call it a dirty little secret, pricing computed primarily for the government customer isn’t openly acknowledged. Having said that, we are sure there is going to be some handwringing over our discussion of this issue, but it’s important for everyone to understand.
Government at all levels insists that it receives the best possible pricing from a vendor. After all, they are generally buying at the wholesale level and paying commensurate prices. That makes complete sense. For products that are designed and built primarily for government use, you’re going to see wholesale pricing that more closely reflects what you and I would expect for retail. This is especially true of specialized, high quality, low demand items such as those intended for SOF. These products often incorporate special materials and construction. Unfortunately, the market remains small for them due to their specialized nature. There won’t be as many individual units to amortize the total costs of development and production driving prices up.
What many would consider a subsequent high retail price was set to substantiate that wholesale/government pricing that we mentioned earlier. In these cases there was never any real intent that the product would sell at the retail level. This is why those vendors generally offer a special discount to credentialed individual customers. Unfortunately, for those not eligible for special pricing, it’s best to look for sales or to purchase the item used.
We hope this will help you understand why some products cost so darned much. They’re generally high quality low demand items, built primarily for government purchase.
