The cost of LPR over time...

[clairm]

This has been getting discussed tangentially on a couple different threads, so I decided to do an actual analysis over lunch.

Estes has digitized all of their catalogs and made them available on the web at https://www.estesrockets.com/customer-service/full-catalog/, so it is possible to compare prices over time. The Bureau of Labor Statistics (https://www.bls.gov/data/inflation_calculator.htm) has a handy inflation calculator that lets you adjust prices between any two years from 1913 to today.

I picked (somewhat randomly) six different items from Estes that I thought would be available over the decades and still be relevant today:

Alpha III - the original plastic-finned rocket, a first rocket for MANY
Big Bertha - classic with big balsa fins
Interceptor - sci-fi ground breaker, higher price and lower volume?
Starter Kit - Alpha (III) starter kit, rocket, motors, and launcher
A8-3 - small, mass produced, motor
D12-5 - biggest available motor for much of the time studied

a - The actual full retail price from the catalog (or web site)
s - What the price "should" be, based on the original 1970 (or 1980 for the Alpha III/Interceptor) price, adjusted for inflation.

Motor prices are based on the price of a (three) pack divided by the number of motors.

I started with 1970, because that is about when I got interested in the hobby. Looking at that catalog brought back a flood of great memories, including getting blue tubes of 3 motors for a dollar at the LHS! Anyway, the numbers:

       Alpha III   Big Bertha   Interceptor   Starter Kit   A8-3   D12-5
1970a:                3.00                       7.00        .30     .67

1980s:                6.37                      14.87        .64    1.42
1980a:  3.75          5.75           9.00       15.95        .68    1.42   Wow, pretty close to inflation!

1990s:  5.95         10.11                      23.58       1.01    2.26
1990a:  6.99          8.19                      25.99       1.15    2.10   Plastic stuff jumped more than inflation, BB way cheaper, motors +/-

2000s:  7.84                                    31.07
2000a: 11.49                                    36.49                      Dark days for Estes, high prices, little selection

2010s:  9.92         16.86          23.82       39.34       1.69    3.77
2010a: 18.29         22.99          27.99       32.49       3.00    5.10   Plastic stuff and motors are now double what they should be

2014s: 10.82         18.39          25.98       42.91       1.84    4.11
2014a: 19.99         24.99          29.95       32.79       3.43    6.00

The results:
Alpha III - costs twice what it should
Big Bertha - 35% too much
Interceptor - only 15% too much
Starter Kit - The cost of entry is lower than ever!
A8-3 - Almost twice what it should be
D12-5 - 50% more than inflation

Prices jumped by a lot during the 70s, no surprise there. The 2000s were also bad, with the price of an Alpha III almost doubling. The recent price changes don't look out of line with inflation at all. Anybody have Estes motor (or any other missing) prices from 2000? Looks like if you can use that 40% off coupon, almost everything is still available at the 1970 price!

 

[Scotty Dog]

and some day someone will look at 2014 and compare it to 2054.

 

[Woody's Workshop]

That's some nice interesting data to know.
I know in ridgid foam insulation around the end of 2007 prices started going up twice a month until the end of 2008 when I got laid off.
Prices more than tripled in a year. The reason was the cost of the manufacturing chemicals and process (natural gas for one) and haz-mat disposal was claimed.
But it was a time it seamed everything tripled in that same year.
It doesn't surprise me that the MFSR price is around 50% than statistical cost inflation. Due to it is an average of everything including income and unenjoyment.
And I have almost all those mags downloaded to my ext. drive. Gives me something to look at when the payment is late on the internet and it goes off for a few days.

 

[JeromeK99]

Besides inflation, any business must consider volume. I wonder if this hobby has actually shrunk as everybody assumes or if they are actually selling more because of a greater population and distribution. Here in the U.S. alone, we have +114 million people since 1970!

Jerome

 

[Gary Byrum]

Those ARE interesting numbers. Seeing how I would likely build a BB from scratch, I could do it for about $6.95. Excluding the cost of a chute, to which I have many and would just use one of those. I wouldn't have the"snappy" decals but, hey.

 

[Cl(VII)]

I think the A8-3 is holding up well in what I actually pay for them. Granted I need to buy them in 24 packs, but from AC Supply I pay $43.19. That works out to $1.80/motor plus I get the wadding included. The D12-5 is doing even better at $3.60 each from AC Supply. Granted I can't just walk into my LHS and buy at these prices, but at the rate I go through motors buying in bulk is preferred.

 

[Kirk G]

It would almost be worth driving that 45 miles to get to a store that had a 40% Off coupon to get back to 1970 prices!

What exactly IS the appeal of a "Big Bertha" instead of a "Baby Bertha"? Don't both have wind-cocking issues?
(I can ask this cause mine was a gift, left over from an earlier day when someone bought it and sat on it, then regifted me... so I don't know...)

I still think there are ways to get into this hobby without the totally large expeditures. We need to find ways to make that entry easy and appealing... that may be behid the starter pack pricing.... a smart move, I would think! Once they're hooked, higher prices for us "regulars" could be offsetting that reduced entry level pricing...

 

[FastCargo]

It would almost be worth driving that 45 miles to get to a store that had a 40% Off coupon to get back to 1970 prices!

What exactly IS the appeal of a "Big Bertha" instead of a "Baby Bertha"? Don't both have wind-cocking issues?
(I can ask this cause mine was a gift, left over from an earlier day when someone bought it and sat on it, then regifted me... so I don't know...)

I still think there are ways to get into this hobby without the totally large expeditures. We need to find ways to make that entry easy and appealing... that may be behid the starter pack pricing.... a smart move, I would think! Once they're hooked, higher prices for us "regulars" could be offsetting that reduced entry level pricing...

I would think it's the other way around. I don't think there are enough of us 'regulars' to sustain the hobby. I think the majority of sales are from the 'one and done' crowd. Engines are a whole other issue...I don't know why engines may be outstripping inflation other than shipping costs have gone up (I assume most of Estes stock of materials needed to make BP engines are shipped in).

FC

 

[Gary Byrum]

What exactly IS the appeal of a "Big Bertha" instead of a "Baby Bertha"? Don't both have wind-cocking issues?

Let's see if I can make this a short story. BB was introduced in 1966, it was a really big rocket to the young enthusiast, it was draggy enough for those dramatic slower liftoffs, it was easy to build and if anyone old enough to have bought one in the 60's, it held a special place in our hearts. I got my second BB in 1985 after winning a design of the month contest to which nearly $100, would get a great lot of kits and parts in those days. I never flew it though. I wanted it for nostalgic reasons. Come to discover that I was not alone with having one in my fleet for the same reason, after having joined the forums. I suppose, you just gotta have a BB in your fleet, or it's not complete. It's the only un-flown shelf queen I own. If all this is not enough, turns out, it's Vern's favorite rocket. And if I ever get a chance to meet Mr. Estes, I WILL get his sig on it.

 

[Tanarin]

While I can't explain the rockets, I wonder how much of the jump in price for 2010 is a result from 9/11 and tougher regulations?

 

[GlenP]

Nice trip down memory lane. My first rocket kit was a Centuri combo that had the Screaming Eagle (plastic fins) with a POWR PAD launch pad that mounted to a dry cell battery, as a bonus it came with the Excalibur (cardboard pre-cut fins). It was the "prize" I selected for selling greeting cards door-to-door (mostly to my Mom) from one of those sales club ads in a Boy's Life magazine.

https://www.ninfinger.org/rockets/nostalgia/73cen00a.html

I just bought an Estes Tandem X kit for my son (a 2 rocket kit with launcher), with a 50% coupon from Michaels, ended up being about $15.

At first I thought this thread was going to be about how much an individual spends on rocketry over their lifetime. I know my paper route money went pretty exclusively towards rockets back in the day, but I had much lower overhead back then.

 

[grapetang]

Interesting analysis! I'd like to mention one major difference in the today's starter sets: they do not include motors where the ones in the past did. It reduces the "should-be" price slightly though entry cost is still good.

Re: Big Bertha: different rockets for different tastes? I've never built one and probably never will, but I do have two Big Berthas and two Baby Berthas for parts and goonies!

 

[boomtube-mk2]

But shouldn’t the price increases be LESS than the inflation adjusted price due to having moved virtually all of the production to China?
Or would we all be paying $50 for a “Big Bertha” if that hadn’t been done?
Or would Estes have just gone out of business?

Way back in 1995 I read several studies that were made about what minimum wage would have to be in order to have the same real purchasing power it had in 1965. Depending on the study that figure ranged between $14 to $16 an hour.

This was in 1995!!!

What would it have to be today? $25? $30?

 

[Rex R]

a big bertha with a 24mm motor mount flies nicely on D motors and screams on E's and F's .
Rex

 

[Tarasdad]

Price of consumer goods and inflation over time are not directly linked. Too many other factors affect manufacturer costs. To get a true picture you have to factor in the cost of oil (highly variable over time), labor costs (steadily increasing, even in China), transportation (also cross-linked to oil and labor), taxes (manufacturers and retailers now pay tax on unsold goods) - the list goes on and on and on. I'm surprised Estes has been able to keep their prices as low as they have.

 

[dave carver]

That chart would gain relevance with the inclusion of other things charted over the same period, like gas, like food, like...you know...Price of food makes me want to quit eating.

How does that old joke go? " I'm going to have to give up the luxuries in my life like a house, clothes, food..."

 

[byoungblood]

Am I correct recalling that the starter sets used to also include 4-5 motors, wadding, and igniters? I seem to recall this being the case with the Alpha 3 set I got 25 years or so ago.

So not only has the price gone up on those, you're also getting far less for the money.

 

[Mojo_wire]

Actually, food is the cheapest in the US than anywhere else in the world, relatively speaking. The average American spends 6.4% of their income on food, that number gets close to 50% in much of the rest of the world.

I think the point about the 40% off coupons bringing prices back to in line with inflation is the most relevant point. Back then there were only two points of sale -- LHS and direct from Estes. Prices were the same at both locations, so Estes made a little from sales to hobby stores and more from direct sales. Probably something like a 20% margin on wholesale and 50% on retail.

Now the profit margins are likely the same for wholesale sales (I would guess that production costs have trailed inflation by a bit) but because of the added competition from Internet sales the MSRP has to rise because discounting becomes more prevalent.

So the cost to consumers has not gone up relative to inflation as long as the consumer is willing to seek out the best price.

 

[tightwad]

and some day someone will look at 2014 and compare it to 2054.

I'm not going to worry. I'll either be counting worms or an old fart in some care facility talking about how big his rockets were. :lol:

 

[Nantucketdink]

I just returned to the hobby recently and was pleasantly surprised to buy a starter set with launch pad, controller, and 2 rockets for $20 with free shipping. The 3 pack of engines and starters was a whopping $7. I think $30 to get someone started in this hobby is manageable for just about everybody. I think you get a lot of bang for your buck with model rockets.

 

[Space Oddity]

Actually, food is the cheapest in the US than anywhere else in the world, relatively speaking. The average American spends 6.4% of their income on food, that number gets close to 50% in much of the rest of the world.

I agree. Your State Department figures show 6.4-6.8%. This they also state, results partly from individual wealth but mainly from the ability of the US to produce most of its own food.
You are incorrect in suggesting that in "much of the rest of the world" the number gets close to 50%. Ireland and the UK are 7.9% and 8.9% respectively. Much of Europe is below 15%, Canada - 9.1%, Australia 10.6% and Japan 14.4%, etc. It is the poorer nations that have the high proportions, being topped by Azerbaijan and Pakistan at 48.5% and 45.4% respectively.

I think there is a more trivial parallel with rocketry. The US dominates supply and demand so the rest of the world imports from the US. That's why we pay over inflated prices in the UK and Europe. Prices that make your comparisons over time quite enviable.

One question for you all. From reading this thread I get the impression that you think demand and interest in rocketry is falling off in the US. That's not my perception as a UK outsider. Do you think that's the case? If so it means increased prices for all, not just the US.
Interested to read your view.

SO.