What's the formula for pricing something for sale? Cost of materials plus labor, then multiply that by three or four as a base?
I studied industrial design and for most products, kettles, vacuum cleaners, refrigerators, etc. we would typically work on retail price being 5 x the cost of manufacture. So if you want to sell a kettle for £20, you have to be able to make it for £4.
However, with audio gear and some other products, clothing, shoes, cars, fashion items and things where a great deal of money is spent on marketing and building a brand, it's more a case selling for as much as you can get away with.
In the past few decades I think we've seen this trend increase and even fairly utilitarian items, like vacuum cleaners and refrigerators, are heavily marketed and branded and the price of "top spec" models has increased significantly over that of the base models, despite not being significantly more expensive to make.
Car manufacturers make far more profit on luxury cars than they do on the base models and other sectors have followed the example. A fancy refrigerator with a water chiller and temperature indicator on the front might only cost 5 or 10% more to make than a standard one, but will retail for 50 or 100% more.
I became quite dissilusioned with industrial design, I think there are very few products that are genuinely better than their previous incarnations. For the most part, it's just a styling excercise or inclusion of an ever increasing array of superfluos features, like refrigerators that connect to the internet and have a screen to remind me to buy milk, or a mobile phone with a camera sensor with 2 more megapixels than last years model.
Anyway, enough of my off-topic rant.