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La Marzocco GS3: New Rules - Page 5

Postby HB on Fri Dec 07, 2007 12:52 am

Marshall wrote:Dan, I thought I did, albeit indirectly and with (I hope) some humor. I don't know what kind of business world you work in, but in mine, people don't promise one price and then nearly double it just before delivery without serious damage to their reputations and long-term business prospects... If Franke has its act together, I would expect them to issue some kind of apology.

In my business we don't promise a production price until it's production-ready. Prior to that, all you get is wishy-washy WAG prices with loads of asterisks leading to three point font text written by crafty lawyers. Those asterisks obviate the need to say "I'm sorry" in a court of law, or so the crafty lawyers tell me.

I don't dispute their public backpedaling is a major gaffe (and trust me, I'm in the information technology business; we know all about major gaffes). However, I would not expect La Marzocco to sell the GS3 below market value to save face when no purchase order was accepted. At some point in life and the business world you have to say "sh*t happens" and move on.

In my opinion, the only interesting question is whether the GS3 is worth its newly declared price or not.
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Postby Matthew Brinski on Fri Dec 07, 2007 1:36 am

HB wrote:At some point in life and the business world you have to say "sh*t happens" and move on.


... to Synesso.

More realistically, for the home user looking for that rotary PID'd DB, I would keep my eyes open for what may come down the line from Vibiemme ... hopefully in this coming year.
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Postby Ken Fox on Fri Dec 07, 2007 3:29 am

HB wrote:I would not expect La Marzocco to sell the GS3 below market value to save face when no purchase order was accepted. At some point in life and the business world you have to say "sh*t happens" and move on.

In my opinion, the only interesting question is whether the GS3 is worth its newly declared price or not.


It clearly is not to the market niche that would buy it.

This is not a production machine, something that you could reasonably expect to hold up in a commercial environment, with the demands that would be placed upon it. Can you imagine this small machine banging out 25 or 50 shots per hour, 5 or 6 or more hours per day? I don't think it is designed for that kind of throughput, either in terms of its usability or its potential durability. You'd probably be better off with a hugely cheaper one group Simonelli in that sort of application. There would be very few venues, possibly none, where the customers of such a commercial enterprise (or wedding or other catering spot) would give a rat's a** about the technical features of this machine; they'll all be ordering milk drinks anyway.

Considering how the machine was developed in the first place, with input from a number of people who were lent units for testing, it is pretty obvious that this machine was not developed for use in commercial settings. If it were, then why'd they bother lending machines to home users, and in which cafes was it "test driven?"

I'll make a wild guess about how all this has come about. The N. American distribution of LM products is through Franke, which bought ESI several years ago. Franke has been taking over more and more control from the "leftover" ESI folks in recent months, with supporting evidence being the name change that Franke instituted recently on the old ESI operation ("Franke USA, or somesuch). Franke has distributors and dealers in the USA, and at least one of these outfits got upset about the plans to market these machines directly to consumers, hence bypassing THEM.

Franke is not beholden to the ESI people or to LM; they have the rights to LM distribution in the USA, and they have exercised this right and are doing as they please. This is probably against the wishes of the LM folks we know and love, who must, nevertheless toe the line having sold out ESI to Franke, with whatever commitments were made at the time of the sale.

So, there you have it. The LM folks are not calling the shots when it comes to USA distribution, something they have only been confronted with very recently. And they are having to swallow a very bitter pill which unfortunately makes their original decision to even develop this machine appear to be a bad one, in hindsight. The next thing to watch for will be whether these LM folks will choose to have anything to do with Franke after their contracted time runs out, which presumably they are committed to after the sale of ESI to Franke.

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Postby JonR10 on Fri Dec 07, 2007 7:42 am

HB wrote:BTW, nobody seems to want to answer the question I posed earlier: Why would you expect the GS3 to be priced significantly below the Linea one-group? Does the Linea hold charming cachet that commands a premium? :roll:


My reasoning has been that the Linea is more machine, well at least it seems to be more robustly built. That's why I would expect the GS3 to be a step down in price from the Linea, albeit maybe not a $3k step.
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Postby zin1953 on Fri Dec 07, 2007 11:11 am

At some point, we -- the "end-user" -- have to admit that we're nuts.

-- Into video? At what point do you own a big enough flat-screen? (Not until you have a Jumbotron?)

-- Into computers? At what point are you done upgrading to a faster chip, more RAM, and a bigger HD? (Do you really need that Cray?)

-- Into espresso? At what point is the machine you have enough? (Do you really need that two-group Linea in your kitchen?!?!?!)

By any stretch of the imagination, the GS/3 is was over-the-top for even the dedicated home-user. (How many shots do you pull on a weekday?) Heck, my La Val could run in a small bar or restaurant, and yet I dream of upgrading to a plumbed-in model . . . I can easily make the argument why I need to upgrade, but come on -- do I really? No. I want to.

The simple fact is that one needs a hell of a lot of disposable income to afford a GS3 at the "old" price; and significantly higher income now. (Either that, or a really creative accountant who can come up with a write-off!) And at that level of income, the already tiny percentage of people serious enough about espresso to WANT this sort of machine (and has a butler, chef, and valet who knows how to properly use it) is miniscule.

This doesn't mean that La Marzocco should take a loss in terms of selling below cost. But at the "new" price, it seems to me you have to wonder what the reason for the machine's existence actually is . . . .
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Postby Ken Fox on Fri Dec 07, 2007 11:13 am

JonR10 wrote:My reasoning has been that the Linea is more machine, well at least it seems to be more robustly built. That's why I would expect the GS3 to be a step down in price from the Linea, albeit maybe not a $3k step.


My own opinion is that comparisons with other machines that very seldom live in homes is a complete waste of time.

You can be certain that when Dell sets out to produce a computer system, they decide on the intended market before they select the first integrated circuit on the motherboard. After they decide what market they want to serve, then they design the machine around this market, with the most important factor being that they will come to market at a price that the intended customer will pay. Only then does machine design proceed and it is then done to those specs and at that price point.

LM appears to have done more or less the same thing with the GS3, although after the reality of the costs became obvious they were forced to price it at the very upper end of the range that they thought they could sell it for (e.g., when the provisionally announced price of ~$2500 went up to $4500).

In the interim, during a period of design and other delays (including UL Certification), Franke, which had bought US distribution rights by purchasing ESI, began to assert control over US distribution, a control that they were obviously entitled to having bought those rights.

In the end, you have a machine that was conceived for the very high end US home market, with the expectation that there would be some "spillover sales" to the rest of the world, since even though most expensive machines in homes are to be found in N. America, there are a small proportion of other potential buyers elsewhere.

Unfortunately for LM, the US distribution system, which they expected to help them by doing it directly, has now changed and they are left with the equivalent of the $3000 home PC, something you might have sold 5 or 7 years ago but wouldn't have a prayer with today, in late 2007.

In addition, one of the major centerpieces of the GS3's new technology is tight temperature control. In Dec. 2007, this has the feel of something about which one might say, "oh, that's oh-so 2004." One has only to read through boards like this to realize that the discussions about shot temperature are a small percentage of what they were a couple or three years ago.

Ergo, I think that if they had it to do over again, LM might have chosen to do this through a separate division that they would have negotiated out of the Franke-ESI purchase, or not to have embarked on the project at all.

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Postby WilsonHines on Fri Dec 07, 2007 12:09 pm

I've not seen a Synesso in person but I have certainly seen many pics including inside the manufacturing area....that baby is very well built and all loaded with stainless.
---JonR10


When I went to Murky ( click here for the story) I saw Nick's Synesso 3 group. It was in the training room (again, read the story). Those things remind me of a Cylon off of Battlestar Galactica. They just seem so "Whoop ass!" Like it is going to destory things! LOL. Seriously, commercial, is the word that comes to mind.

I still love how a FB/80 or a GB/5 looks and feels. However the truck driver in me like the "Peterbilt" in a Synesso!

-- Into espresso? At what point is the machine you have enough? (Do you really need that two-group Linea in your kitchen?!?!?!)
---zin1953


No I don't really need a two group Faema in my kitchen and to be fully up-front about it after I have installed it in the kitchen the machine is too big. It is just taking too much room. The reason I bought my house was the size of the kitchen - it was big. But, this Faema 2 group is really making it seem small.

I bought the machine hoping to open a cafe next year and spend this time training on a commercial rig at home. The wife liked the idea as well - imagine that! If I had to do it over and I was just buying a machine for the house with no other intentions I would get something like a Brutus II. I have seen the GS/3 at Counter Culture and it is nice, but I can't IMAGINE spending that kind of money on it. A La Cimbali Junior would be nice too. I can see spending $3K or a little over on something like espresso, but more than that (on a strictly home situation) and I just don't have it in me.

==Edit==
Let me also add that as I said on another thread in here, I can't imagine having some of these home machines people are using. The portafilters and baskets seem so "rinky-dinky" and the machine moves when they put the portafilter in and it just seems so "cheap." I am a 245 lbs (OK 250) MAN and I like to tinker with well built STUFF! No matter what it is! The Faema has a 58mm basket meaning I need a 58mm tamper. My tamper is a full 10mm bigger than most home machines - from what I have read. They, as a whole, seem fragile and I am a horse! I would break crap like that. AND BTW, if a GS/3 has inferior build quality (AKA poorly align holes and bolts, ect) I probably would break it too!
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Postby Jacob on Fri Dec 07, 2007 12:31 pm

This additional 2-2.5K service-deal is totally absurd.

Ken Fox wrote:... since even though most expensive machines in homes are to be found in N. America, there are a small proportion of other potential buyers elsewhere.

Many rich people in Europe keeps a low profile and finding it untastefull to flash bling bling.

The first 11 months have brought the same number of GS/3's to Copenhagen as many of you expect to be sold the first 11 months in the North American home-user marked.
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Postby JonR10 on Fri Dec 07, 2007 12:59 pm

Ken Fox wrote:My own opinion is that comparisons with other machines that very seldom live in homes is a complete waste of time.

OK, then what do you propose to use for comparison?

When the GS3 was to be priced at $2500 - $3k it was fair to compare it with other machines at that price point like the Cimbali Jr., N-S Appia, Reneka Techno, or the Elektra A3/T3.

At $4500 it would compete with machines like Faema Legend (and likely others I can't think of at the moment).

With the GS3 priced at $8k it is competing with machines like the Linea and Cyncra. At $8k ALL of the available options can be said to "very seldom live in homes". That elite group will now include the GS3
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Postby Ken Fox on Fri Dec 07, 2007 1:08 pm

Jacob wrote:This additional 2-2.5K service-deal is totally absurd.


Many rich people in Europe keeps a low profile and finding it untastefull to flash bling bling.

The first 11 months have brought the same number of GS/3's to Copenhagen as many of you expect to be sold the first 11 months in the North American home-user marked.


I'm not sure that most Americans are any different, although there are many obvious exceptions.

There are aspects of N. American life that are very different from what one finds elsewhere, which explains why the overwhelming percentage of high end machines and grinders are found over here as opposed to in Europe or Asia. Unlike Italy, good espresso can't be found across the street, so if you want a decent shot you will probably have to make it yourself. The market for high end espresso machines in Italy, therefore, is next to non-existent.

N. American houses (and therefore their kitchens) tend to be very much larger than elsewhere, allowing them to accept equipment that won't easily fit in residential kitchens elsewhere.

Home roasting is easy to do over here, and there are many online sources of green beans. We read posts here regularly of people in places such as Japan ordering their beans from Sweet Marias; would they pay the freight to ship those green beans half the way around the world if they had good local choices?

Electricity in many parts of N. America costs a small fraction of what one pays in Europe and elsewhere. Where I live, a kwh costs around 5.5 cents. This makes operating a big espresso machine in a home a very small expense.

Americans tend to have much more disposable income than most Europeans and Asians. Meaningful comparisons would need to take into consideration the purchasing power of the local currencies in their home countries. With the current elevated level of the Euro it might appear that this is changing, but when a Big Mac or a roll of toilet paper costs 2.5x as much in Europe as it does in the USA, the American is still "better off" when it comes to disposable income. This translates into more purchases of things like large panel LCD televisions, and yes, espresso machines, per capita, in the American market. I can't claim to know all of Europe well, but I do know quite a lot about France, where I spend 2 months a year and where I know a number of people and have visited a number of homes.

I could go on and on, however it is a simple fact that the high end home espresso market is North America-based, and without the N. American component this cottage industry becomes something that would have to be done in . . . . a garage.

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