Ok, here is a very detailed response from Cyrus MD, Peter Bartlett:
"Twelve months ago we set our SE upgrade pricing believing that the engineering and time required to upgrade the players would be very much lower than they actually became. To put costs into perspective you need to understand what has to be accomplished.
Stripping the players down, removing the main board for component level re-engineering, replacing the old servo PCBA with the new SE element, replacing the loading assembly and sub chassis, aligning the new hardware, updating the software, reassembly, production system test and long QC soak test before packing.
Overall this is almost exactly the same path as building a new player, except a new player obviously doesn't take time to strip down.
Having explained the process I hope everyone can understand that this isn't just a quick software upgrade. Our Servo Evolution players are engineered using the highest quality components throughout and this, along with labor to achieve the upgrade, is where the value is. An upgraded player is every bit as good as a new CD 8 SE because most of its components are new.
To put Cyrus' upgrade path into perspective; if you buy a high spec digital camera or a high performance car its value drops almost instantly as you write the cheque, Cyrus is able to maintain the value of our customers purchases for many, many years. The fact that we are able to upgrade players at all is unusual.
As our costs are almost the same as a new player, how should we price the upgrade? Our policy is that, where possible, upgrades should cost slightly more than the difference between two models. In some cases this is very difficult to achieve, but where financially possible, this is our guide for upgrade pricing.
So the logic runs that if the average price of a CD 6 was typically £600 and a new CD 8SE is £1100, (£500 difference) we charge £700. To have a three year old CD 6 and upgrade it to a state-of-the-art SE player for £200 more than the difference between the original retail cost and today's new player price is fabulous value. (It may be relevant that many consumers will have purchased a CD6 SE in the last 12 months when the street price was very much lower making the difference even smaller.)
However, having realised that we had made a mistake on the pre-launch upgrade costs and that many customers would upgrade quickly we made a decision not to raise our price until November to give any orders in-house a chance to upgrade at the 'old' price. We made a loss on these upgrades but felt we had to honor the price for units already booked into our service systems over the last 12 months.
Cyrus is staffed by a world class team, totally driven by quality and it's amazing to have shown the world that a small company can achieve fantastic things if we are passionate about detail. Part of the reason we are successful in an industry dominated by low-cost overseas manufacturing is because we are in touch with our customers.
We don't want anyone to think we are making unreasonable profits, but we do have to do better than break even. Frankly, we made a mistake in the original pricing and I can understand that the revised prices look like a very big increase in comparison, however when you understand that an upgrade is almost a completely new SE player, you can, I hope, understand that our upgrades offer very good value indeed."
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