[Towertalk] The Ham Radio Business

[Bill Coleman]

On 4/1/02 5:53 PM, A9xw@cs.com at A9xw@cs.com wrote:

>An interesting question in my mind has always been, "Would Heathkit be alive 
>and well today if the owners had been better business people instead of 
>robber barons who it seems just bought the company to ransack its profits 
>for other losing operations like ZENITH  bankrupt at last?"  

No.

The reason Heathkit thrived for so long was due to the technology. In the 
early 50's electronic gear was all hand-wired. Buying raw parts packaged 
as a kit resulted in a substantial savings -- because the builder 
supplied the labour.

In the 60's and 70's PC boards reduced the amount of labour -- not that 
you didn't need rows of technicians to stuff boards, but because you 
could float stuffed boards through the wave solderer, saving lots of time 
over soldering individual connections. But there was still some value in 
building a kit.

No, the death-knell for kits came when automated insertion equipment was 
introduced in the 80's. The labour cost for producing electronic 
equipment went to virtually nothing. The introduction of mass-produced 
integrated circuits didn't help either.

Sure, Heathkit got worked over by robber barons who were trying to break 
into the nacient computer market. But Heathkit would likely have gone out 
of the business anyway -- there was just so little value in 
builder-supplied labour.

There are a few companies still producing valuable kits, but they are 
more for the educational and hobbiest use -- not for substantial savings 
over manufacturered equipment.

Ironically, the industry which STARTED Heathkit is doing well -- 
kit-built aircraft. One can still buy and build a kit airplane that 
performs as well or better, at a substantially lower cost than a 
production-built aircraft. And it's not rocket science. This industry has 
been booming for the last 20 years.

Bill Coleman, AA4LR, PP-ASEL        Mail: aa4lr@arrl.net
Quote: "Not within a thousand years will man ever fly!"
            -- Wilbur Wright, 1901