DJ gear: prices going up, supply low – here’s why + what every DJ should do right now.
If you’re in the market for DJ or production gear, you might have noticed two big trends right now in 2021. It’s really hard to get gear right now (many, many products are out of stock) and prices seem to be increasing. With DJTT’s unique footing (in addition to the blog, we also make our own gear and sell great gear made by others in the DJTT store), we thought we’d provide some very important context to the current state of the music gear industry.
Here’s what’s up with the industry, and why you might have trouble finding gear this year – or end up paying a premium on it.
An overview of music gear’s current challenges
Across industries, price increases and supply shortages are no stranger to consumers in 2021. This “new reality” has been classified by some as being inflationary, but in the dance music gear industry there are some very specific factors that contribute to a high demand and low supply situation.
At DJTT, we’ve seen a lot of this firsthand – since we manufacture our own products and sell gear from others. It has given us a front row seat to what’s shaping up to be one of the oddest years in the music gear industry ever.
Here’s what’s contributing – we’ll dive into each in the sections below.
- Prices of components rising
- Labor costs are going up
- Ocean / air freight fiasco
- Little relief from tariffs despite political change
- A semiconductor chip shortage
- Live events demand recovering slowly
Cost of components and labor are increasing
Around the world, these two cost increases are having major impacts on physical goods manufacturing. There’s a lot of reasons why labor prices are increasing (an ongoing pandemic, a labor shortage, local lockdowns, and many more). As labor costs go up, those increases can also feedback into component costs.
Components have seen a significant increase from raw materials. A great example here is with audio cables (like our own Chroma Cables), which all rely on copper for the actual wires themselves inside of the cables. Raw copper prices have nearly doubled in the last year (according to our own component sourcing, but also well documented here on MacroTrends).
“Higher costs of shipping and component parts have contributed to higher selling prices. Fifteen of our twenty reported product categories have seen substantial increases in average selling price vs. year ago.
In some categories such as guitars, live sound and DJ products, we believe higher average selling prices reflect higher costs and resulting price increases as well as a shift in demand to higher-end products.”Jim Hirschberg of MI SalesTrak in his July 2021 report
The fiasco that is Ocean / Air Freight
Ocean freight is largely what makes supply chains of consumer goods (like that new DJ gear you want) possible. It allows products to be manufactured in a market where components and skilled labor are readily available and then shipped all over the world at a reasonable rate in roughly a month to any destination.
The “fiasco” is this: ocean freight has consistently been overbooked and delayed in the last few months, with no signs of it getting better. It’s no better on the arrival side (especially for the US), where port congestion has gotten out of hand. Here’s a excerpt from a weekly shipping newsletter that I watch closely:
The number of ships at anchor, waiting for berth space to open up at America’s two largest boxports, has hit a new record today with more than 40 ships now forming queues further and further away from the terminals at Los Angeles and Long Beach.
The extraordinary congestion seen at America’s main two west coast ports is far worse than the port lockout days of 2002 and 2004.Kent Qi, Brilliant Group Logistics newsletter on Sept 6th, 2021
This has led to increased ocean prices (companies paying a premium to guarantee space on a ship) and air freight prices (companies paying a lot more to get their goods faster). Needless to say, air freight is also far crappier for the planet until we figure out a way to fly cargo without burning through jet fuel.
We’ve had our own experience directly with this. DJ TechTools had a large batch of Chroma Caps headed to our HQ earlier this summer, booked on an ocean vessel bound for Oakland. They got pushed back multiple times due to overbooked ocean vessels, meaning more than a month total delay in delivery time.
The good news here is that supply chains can adapt to longer lead times, but in the near future, it will continue contributing to many out-of-stock products.
Tariff relief, or lack thereof – and the inability to move manufacturing
One may have thought that the administration changes in 2021 in the US would have meant some relief to gear manufacturers who rely on Chinese partners to produce goods – but it hasn’t happened. For companies that manufacture their DJ and production gear in China (there are a lot of them), the tariff increases amounted to at minimum a 20% cost increase on goods delivered to the United States. That’s a huge percentage, and has lead to many companies to look elsewhere to produce their products.
However, there’s no place quite like Shenzen when it comes to manufacturing. The amount of specialized labor, factories, and goods in one region is unsurpassed almost anywhere else in the world. To get a sense of this, check out this amazing video from Strange Parts that takes you on a tour of the Yihua and Depu industrial markets in Shenzen. There’s simply nothing like it in the US, and that is a big reason why even a 20%+ tariff increase mostly hasn’t changed where consumer electronics are made.
This is a big one – and it’s likely going to impact gear in our industry for a few years. For those of you who have tried to buy a car or a graphics card in the last 6 months, you already know the deal: there’s a shortage of semiconductors available right now, and it won’t get any better in the short term.
While big companies like Apple have a solid lock on their high-end semiconductors, lower-cost silicon products like those that end up in cars or DJ gear are much lower priority for companies making chips. This has directly contributed to longer lead times, “empty shelves”, and higher-cost gear.
Live events slowly recovering
Thankfully for all of us in the DJ world, events have kicked back into gear this year with vaccination and pandemic best-practices becoming a reality in many parts of the live events space. Even so, there’s certainly lower demand for festival-level amounts of gear, which drives a lot of the revenue throughout our industry. Events absolutely are not back at 100% of what they were “pre-pandemic”, and that has meant more careful purchasing by companies throughout the industry.
What this means for DJs
Don’t underestimate the practical realities of what the above factors are already doing to our industry. As an example, Pioneer DJ recently increased a lot of their products’ prices about 2-4% and have extended lead times for a lot of their coolest gear (we’ve heard we might not get DJM-V10s back in stock until March 2022…).
Here’s what we think every DJ should be considering right now:
- If you’re looking to buy DJ gear or production hardware in the next 6 months, start thinking about it now.
- The DJTT store team has set up a Gear Hotline right here to help you find what you want and get first in line for units when they come in stock. Check it out and chat with our team today.
- Don’t expect prices to go down later. Often there is a high expectation of Black Friday being the driving force for discounts in our industry, but with supply so low, getting your hands on what you want should be the first priority.
- The used market is going to be a good source of gear – but you’ll be paying inflated prices. We can highly recommend Reverb as a great platform to get used gear. You can use this code to get $10 off your first purchase.