I think that co's like PM Gear (makers of the Bro Models) and DPS a few years ago were selling between 500 and 1000 pairs of skis total in a season. They both may be a lot bigger today, but I doubt they are selling more than 2000 pairs of skis each (I could be wrong). If we assume that that the average sale prce per ski is $800 then at 500 skis they have gross revenue of $400k and at 1000 skis they have gross revenue of $800k. Generally the big guys (head fisher Atomic Etc) have roughly 40% GM on their skis which they sell at about a 50% discount from MSRP to the dealers (PHil can help here). This implies that cost to build a $1000 retail ski is $300. These companies have economies of scale, but many manufacture in high cost areas like Europe and not China (K2 does everything in China). DPS is doing all manufacturing in China. My guess is that in China you can build a ski for $250-300 in lower volume (500-1000 units). Assuming that cost then at $800 Gross profit for every ski is $525 x 500 = 262,500 and X 1000 = $525,000. From there we can guesstimate what the other costs of the business are. My guess is that many of ?these business are around break even at 500 skis. At 1000 they make some money. I would say this is true for all the garage companies. Once they start spending more for marketing and or distribution and start adding head count, that profit can disappear quickly. My guess is that if Dave sold 1000 skis this year he would makes some decent profits and he would be quite happy. Phil may be right that if he sells 150 he may be lucky.
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