iMacs cost $898 to make?

Whilst working at a computer shop last year, I had the job of purchasing anything we desired to sell, after looking into reselling Apple, I was shocked to discover that we would make a maximum of about 1 profit on each computer and that's only if we could get the suppliers to give us free delivery! They must make the profits on upgrades and additional software, maybe that's another reason why there are so few Apple resellers around?

Would be a lot cheaper if they stopped making machines with stupid built-in monitors. Just get the parts, stick em in a G5 case, bingo.

MacSlash did not come across a report from analyst firm iSuppli, a MacSlash reader came across a PCMag.com article.

Nobody's talking retail except for Mikey Hodges who is clearly out of his mind.

Jumi, you sir are making sense, but those numbers (and words) aren't mine they belong to John Gruber and he's talking averages so I think you're looking a bit long.

Other iSuppli reading:
http://www.businessweek.com/print/technology/content/jan2006/tc20060119_311993.htm
http://www.reed-electronics.com/electronicnews/article/CA6300680?text=isuppli

Let's also remember kids that the pricing they've put together isn't retail. They didn't use the retail price it would cost you or I to purchase a Dual Core Intel chip, it was Intel's pricing for the big dogs - like Apple. One could only guess how much something like a $150 (retail) iSight would cost Apple to slap into an iMac.

Adam, your figure of 31% margins assumes not only that all of the costs per unit are captured by iSpli's analysis, but that Apple sells every unit at retail. If they have non-captured costs and/or sell any units at wholesale their gross margins are clearly less than that.

And, of course, all of those designers, programmers, etc. don't work for free.

So, adding in the additional stuff that they left out; $129 for Tiger, $79 for iLife, and say $30 for the keyboard and mouse...

Those prices are retail. Apple is a manufacturer so they don't pay retail -- especially since they make all that software and hardware.

I think you're confusing manufacturing cost (to Apple) with consumer value (to you and me).

UMMM... let's not forget the built in $150 iSight and FrontRow remote

I'll still pay 1299 for the design and compact form factor. And besides, it comes with 1 year warranty.

There was some insightful commenting on this on Macslash, on things that were overlooked in those numbers.

"So, adding in the additional stuff that they left out; $129 for Tiger, $79 for iLife, and say $30 for the keyboard and mouse (a wild guess on my part), that comes up to an extra $240 bucks or so. Factor in that it's not an upgrade, but a whole new licence of Tiger, and that brings it to, say, $300 of stuff. Add in design costs (somehow I don't think that Ives & crew comes cheap), and I'll guess you're looking at about $1250 "worth" of stuff.

So --- $1299 MSRP, less $1250 "worth" of stuff, leaves a $50 profit margin.

SOLD! (I just checked with FedEx, mine arrives tommarow. :-)

P.s. - not mentioned in the article that I read, was the built-in Airport Extreme or Bluetooth modules, nor the iSight. I don't know if they remembered to count that in the original figure."