He is trying to sell the company as his machine job shop raised the price too much to continue on with production. He only has what shows in stock on the web site with no new ones in the pipe line. They how ever do work really well. I use them at work all the time and they are made in the USA
I have to laugh anytime I see some retailer make a statement like the one in bold above.
The solution is dirt simple. When a supplier "raises the price too much", you just make them yourself and keep that mountain of profit the supplier is making and add it to whatever you've been making on the product. Yeah, there's that minor hurdle of needing a million dollars' worth of facility and equipment to make them yourself, but, if the real problem is a supplier charging you too much, then covering the cost of that manufacturing capability to bring it in house shouldn't be a problem.
Seriously, this line of plug sockets would fall into the category of special service tools and their comparatively low overall volume since the majority of them are aimed at very specific applications. Compare their prices to those of Kent Moore service tools of similar complexity, and it will be immediately obvious that the lockit sockets are grossly underpriced.
The typical retailer is looking to pay no more than 50% of the retail price for machined parts, and often much less than 50%. Let's say they're wanting to buy the $30 sockets for $15. It will take a fairly massive turning center to produce the parts with no secondary machining operations. Massive not because of the size of the parts, but due to the required blind broaching operations which generate relatively high forces in tough materials such as the Cr-V steel typically used to manufacture sockets.
The lathe, a magazine type bar feeder, and the necessary tooling will easily hit $250K. There's plenty of work out there that will generate $150/hr on a machine like this, with substantially higher volumes, so a typical shop is going to look for that same sort of gross hourly money (exclusive of material) for making these sockets.
Figure a buck apiece for material, another buck for heat treatment, 50 cents for vibratory deburring and cleaning, another buck for roll stamping or laser marking, and another 50 cents for black oxide. Total of $4 off the $15 the shop needs to work to. So, to generate $150/hr for the machining, you'd need to produce 14 pieces per hour, or one part every 4 minutes and 20 seconds with zero down time. In reality, 85% uptime is considered very good utilization, so that requires that your cycle time drop to 3 minutes and 40 seconds.
In the real world, considering the toughness of the material and the number of operations, you'd have to have the process well tuned to run a cycle time of 10 minutes. 6 parts/hr X $25/part = $150/hr on the machine. Plus another $4 for material and non-machining processes gives you $29/part.
If the product won't support a $60 pricetag in the market, then its a failure regardless of how useful it might be. Maybe it would support that price, but its a solid loser at $30. Good luck with selling a business where you lose money on every unit you sell.
