Bulat on KickStarter

[MAS4T0]

As high as that number is - I do not see why they should not manage to make those knives.

A lot of Kickstarters fail to deliver because the guys behind them often have very little project management experience and the project can end up being very large. There's a lot that can go wrong when you have an inexperienced team trying to deliver on thousands of items which have to be specially commissioned from manufacturers.

Most successful businesses either take on significant investment (and then burn through millions) or start small and grow organically, placing small tentative test orders in the beginning and gradually expanding as the business grows and trust is built with manufacturers and other service providers. A crowdfunded project will usually have impossibly tight deadlines (based on inexperience of what's involved) and the big pot of money reduces the feelings of trepidation when committing large sums. It's also usually the case that there isn't the possibility of external investment (as nobody would invest when the funds are required to fill existing orders rather than grow the business).

Also with low margins it means that while $710k is a lot of money, they maybe only have $70k gross profit from which they need to cover tooling, process development, QC failures, staff wages, expenses, admin, etc. They would need to keep these possibly unforeseen costs below $70k to make any profit, but if they go over $70k they would be cutting into the funds which needed to be set aside for materials and production costs.

I obviously don't know know what their actual margin is, but the usual problem is that gross profit is assumed to be net profit and they also don't allow for a contingency. When people are inexperienced they often want to be as generous as possible and end up setting themselves up for failure with too low margins. I'm not saying that's what is happening here, but the skills needed to market a project are very different to the skills needed to bring the project to completion and with low margins you need a very tight team if you're going to deliver.

 

[Matus]

Point taken, those are all good arguments.

 

[gic]

I'm not sure their gross margins are as low as you might think. I wouldn't be surprised if they are getting the knife made for $30 or so. Zhen a well respected taiwanese company is selling a san mai 8" VG10 knife almost certainly made in china for <$70 retail, using a pretty standard 100% markup that gives $35 unit cost and AUS 8 is cheaper than a san mai VG 10 I bet.

But yea, running a company is non trivial and most people are too quick to assume it is a piece of cake.

 

[MAS4T0]

I'm not sure their gross margins are as low as you might think. I wouldn't be surprised if they are getting the knife made for $30 or so. Zhen a well respected taiwanese company is selling a san mai 8" VG10 knife almost certainly made in china for <$70 retail, using a pretty standard 100% markup that gives $35 unit cost and AUS 8 is cheaper than a san mai VG 10 I bet.

But yea, running a company is non trivial and most people are too quick to assume it is a piece of cake.

I agree, the mark-up of most products is immense, but in many cases it needs to be in order to cover all costs/ expenses and still turn a profit.

I chose 10% arbitrarily to illustrate the point, but the fact remains that they often don't plan for enough. It also makes it very difficult to transition to a sustainable business if they have to implement significant price hikes out of the gate.

Remember too that Kickstarter take around 10%, there's transaction processing fees and the PR company they used would probably be owed 10%.

So even with a 35% gross margin (70% mark-up), there would only be a 10% planned net.

 

[rick alen]

The was an apparently very China-knowledgeable guy showed up for the Misen post, too bad he was shown the door for soliciting a little info as his further input would have been interesting. He felt the Misen could have been had from China for, if I correctly recall, $10-15 depending on the quantity (guessing the lower end considering the $1M+ the Misen boys generated.) Given that I'd say the Bulats are looking at $25/unit tops, $40 delivered to the customer.

They have no overhead, no advertising expenses, they don't require any personnel here other than themselves. It's a one-shot deal as they will never be able to compete out in the real world with the big dogs.

I believe this is what our China-savvy guy had intimated and was interested in himself, a one-shot deal.

Ahahahaha, it just now occurs to me he may even be behind the Bulat! Ahahahaha!

 

[nacayoda]

So, did anyone order one? Are they shipping? (It seems they are close https://www.kickstarter.com/projects/840887253/bulat-your-go-to-kitchen-knife/updates)
I'm still holding off on my purchase of a Tojiro Gyuto 210mm.
But why? Well, I sharpened our current knives after getting a tip on the Ikea sharpener. It works brilliantly... and my wife cut herself badly the very next time she used them. No new knives for me then, yet.

 

[rick alen]

It will likely be junk like the Misen, their claimed 58rc turning out to be 51-55. Just get the Tojiro, and learn how to sharpen on waterstones, rather than the crap pullthru.

 

[Krassi]

Really anyone who says a knife will stay sharp forever is a master of "alternative facts", Get a real knife and learn how to sharpen!
I would also thing that stuff is made in china with a fancy hipster approved commercial spot. Also the main problem it looks like cheap crap.. german grocery vg10 20 Buck knifes look better.. well actually they look the same.. strange

 

[cutler81]

Rockwell of 57-59...hmmm

Ha ha, that is exactly what I thought!
HRC 65 or more would be something worth my money