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      07-15-2008, 11:44 AM   #16
BimmerPost Supporting Vendor
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Drives: F90 M5
Join Date: Oct 2006
Location: Chicago

iTrader: (3)

Don't forget that each of the people involved in the process has some if not all of the following expenses: materials costs, importing costs, TUV approval costs, R&D costs, marketing costs, paying your well paid first world employees, and so on.

Many people don’t understand the need for a distributor or retailer, but it’s important to keep in mind that a number of skills and industry contacts are needed in order to get an exhaust system from the manufacturer to you:

You need a person to speak the native language, at least a little bit, to help design the system for the appropriate market, test fit the system on a US market car, negotiate pricing and shipping times, and place the orders.

You need someone with contacts in the shipping industry to negotiate good shipping rates, consolidate shipments, allow for systems to clear customs, and pay customs fees. MSRP on an Eisenmann is $2800 US IN GERMANY, so imagine trying to get this exhaust landed in the US on your own. To air ship a single system to the US costs close to $1000 US dollars with duties, taxes, air freight, and brokerage and customs fees. You’d pay closer to $4000 US dollars for an Eisenmann E92 M3 system if you tried to ship it in yourself.

Even once the system is here, you need someone who can deal with the staff at the receiving airport, pick up the system, and get it to leave US customs in a timely fashion. When IND first started years ago, systems would be held at customs for an entire week, with us scrambling to get the necessary paperwork to make things happen. Now, with experience, we are usually able to clear systems through customs in a matter of hours, but only because we have working experience with the US customs system.

Simply put, we’re just not making very much money on Eisenmann systems. Are we making money? Of course! Do you make money at work? We need to as well, in order to stay in business.

To speak on the relevance of the TUV approval process to US customers:

The TUV requires all manufacturers to submit engineering drawings of all exhaust systems, and scrutinizes exhaust fit, weld quality, material quality, sound volume, and so on. The TUV approval process is quite expensive, and the cost is built into every system sold by the manufacturer. Eisenmann systems are also built in an ISO 9001 manufacturing environment, and that certification isn’t cheap either.

This might not mean anything now, but when the welds break on your outsourced system because there are no manufacturing standards to speak of, maybe you'll have wished you bought the more expensive system the first time.