Crackdown on contraband Monster Cables ®

[MinusTheBear]

LOS ANGELES - (Business Wire) Monster, a leading manufacturer of cables, headphones and consumer electronics accessories, today announced that its Brand Protection team, working in partnership with the Los Angeles County Sheriff’s Department, made its second arrest in four months yesterday of an alleged counterfeit seller in the Los Angeles area. The two recent arrests are at the vanguard of an intense “Monster Dragnet” to halt illegal counterfeit sales and manufacturing of its products, both here and around the world.

http://www.earthtimes.org/articles/press/counterfeit-seller-los-angeles,1372225.html

This is the first incident I actually agree with the monster when it comes to protecting their brand.

 

[dkane360]

There should be a double blind test between the counterfeit cables and the real ones, then whichever sounds better gets to keep selling them

 

[MinusTheBear]

It wouldn't surprise me if they actually apply some type of intellectual property (trademark) to the words "Monster Dragnet" for their brand protection team.

 

[Seth=L]

I've added to my signature to reflect my feelings on Monster.

 

[3db]

What monster is pissed off from being ripped off my counterfitters and yet, they have no problem ripping of the public? Now thats ironic!!!

 

[highfigh]

What monster is pissed off from being ripped off my counterfitters and yet, they have no problem ripping of the public? Now thats ironic!!!

Ironic? No. Hypocritical, Narcissistic, pompous assssssss or trite? Definitely.

 

[Chu Gai]

Van de Hull has also made note that knockoffs of their cables have been sold on eBay.

 

[MatthewB.]

Van de Hull has also made note that knockoffs of their cables have been sold on eBay.

Hmmmm this explains why when I ordered mine, all I got was a wire coathanger.

 

[Gizmologist]

I bet the coat hangers provided a more precise path to audio nirvana with wider bass (flat across a broader range) and a tight, well supported midrange and the highs were quite capable of supporting the whole experience before a drop off that was out of range anyway.

 

[T2T]

Van de Hull has also made note that knockoffs of their cables have been sold on eBay.

Sadly, there's plenty of counterfeit Audioquest cables being sold on eBay, too.

 

[MinusTheBear]

The lesson for monster is that their pricing on cables is way too expensive which is inducing a black market. What is the markup on monster cables something like 40 times cost??

Black market cables are attractive because the components are cheap, common and assembly does not require much up front costs or skills and they are easy to transport. Hmmmmmm, sounds a lot like tobacco. The biggest incentive is the profit margin that one can exploit between black market and legtimate Monster cables.

 

[highfigh]

The lesson for monster is that their pricing on cables is way too expensive which is inducing a black market. What is the markup on monster cables something like 40 times cost??

Black market cables are attractive because the components are cheap, common and assembly does not require much up front costs or skills and they are easy to transport. Hmmmmmm, sounds a lot like tobacco. The biggest incentive is the profit margin that one can exploit between black market and legtimate Monster cables.

40 times cost? Not even close. It's the perceived demand that drives Black Market. If the cost of a knock-off is low enough and there's enough demand, it's worth it for the fraudulently sold goods. Assuming the knock-offs are not nearly as good as the real ones in terms of the materials used, more profit can be realized. OTOH, it's also safe to assume the manufacturers and resellers of the knock-offs won't throw huge parties at CES and have CSNY, Jackson Browne or other bands like them play there, they should be able to do just fine by charging less than Monster. Those events and parties cost a lot of money but Monster has held them, and others, many times.

Dealers don't sell MC because they make so much on each piece- they sell them because of the rebates at different purchasing levels and the built-in demand, created by others who told the fable before them.

 

[MinusTheBear]

So what is the markup on monster cables then? Not from a retailer/dealer perspective and their margins but what it costs Monster to produce and what they are sold for retail. What is the accurate number?

 

[MatthewB.]

MinustheBear, when Circuit City was going out of business, I wound up picking up two Monster Component cables that retailed for 150.00 for 7.50 each and 8 pair of Monster THX1000 speaker cables with monster terminated banana plugs attached in a nice weave cable that retailed for 120.00 per 10 foot pair, I picked them up 10.00/pr when I spoke with the store manager about why even on closeout they were so cheap, he said that even at 7.50 and 10.00 they were still making a profit.

 

[MinusTheBear]

MinustheBear, when Circuit City was going out of business, I wound up picking up two Monster Component cables that retailed for 150.00 for 7.50 each and 8 pair of Monster THX1000 speaker cables with monster terminated banana plugs attached in a nice weave cable that retailed for 120.00 per 10 foot pair, I picked them up 10.00/pr when I spoke with the store manager about why even on closeout they were so cheap, he said that even at 7.50 and 10.00 they were still making a profit.

So that is marked up 20 times and 12 times the sales retail price vs retail price alone and still making profit (be it small). So my math is not very far off from the markup on Monsters cost on the making the cable. Lots of wiggle room to make a profit on black market goods and yes I agree with highfigh that other factors such as demand as well as world wide brand exposure increase the likelyhood.

 

[highfigh]

So what is the markup on monster cables then? Not from a retailer/dealer perspective and their margins but what it costs Monster to produce and what they are sold for retail. What is the accurate number?

You didn't specify which markup you were referring to. In that case, who knows how much they mark their stuff up?

If dealers buy Munster cables, it's not going to be from some online seller or new rep that shows up. They have dealer agreements that need to be adhered to, or they risk losing the line. Some buy from distributors and in that case the distributor is in the position of just buying direct instead of the dealer going direct.

Lee has been selling this crap for long enough that I'm sure he gets preferential treatment from the source. If he operates the way Sony has when accessories were concerned, I wouldn't be surprised to find out that he bought so much that he became the only customer and then backed off so much, so fast, that the company couldn't have survived because they had stopped selling to anyone else (actual Sony example, leading to Sony buying the company so they could avoid paying the markup).

 

[highfigh]

MinustheBear, when Circuit City was going out of business, I wound up picking up two Monster Component cables that retailed for 150.00 for 7.50 each and 8 pair of Monster THX1000 speaker cables with monster terminated banana plugs attached in a nice weave cable that retailed for 120.00 per 10 foot pair, I picked them up 10.00/pr when I spoke with the store manager about why even on closeout they were so cheap, he said that even at 7.50 and 10.00 they were still making a profit.

Making a profit at $7.50? Not if they were anywhere near the top of their line. Here's the Ultra component cables, $19.95 for the 8'.
http://www.californiacomputer.com/Shop/product.asp?catalog_name=CaliforniaComputer&category_name=&product_id=U2V1000CV8&cookie_test=1

The prices I see online are pretty close to dealer cost from a distributor.

Sale prices during liquidation are in no way related to the actual cost- it's just a way to move things out the door fast, so they can bring in some operating capital.