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152 points lr0 | 2 comments | | HN request time: 0.418s | source
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cjensen ◴[] No.42201750[source]
The US has 222 C-17 Aircraft. A single C-17 costs over $300 million.

If you ask Boeing for soap dispenser parts for these, what should they cost? Boeing charged $149,072 for the dispensers. That's $671 per plane. Is that too much?

If you had to make these dispensers, make sure they conform to rules for aircraft parts and Air Force parts, provide formal responses to bids, etc., how much could you make them for?

It seems high to me. The article says 8000%, which is less than $10 per plane. So while it seems high, it's definitely not 8000% high.

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bagels ◴[] No.42201842[source]
Can you imagine even being a one-man shop making 222 bespoke soap dispensers to some absurd spec AND jumping through all the documentation hoops that are required for only $150k? I wouldn't take that job. Sounds awful.
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dmurray ◴[] No.42202118[source]
Sounds interesting!

The first year you learn how hard it is, you spend 80% of your time on compliance documentation and 80% of your budget on tooling. You still don't have a satisfactory product or a mastery of filling out the forms. It drags on into the second year, you're living on ramen but eventually deliver it (if there's one thing the government procurement process is tolerant of, it's delays) and get paid.

The third year you take on a additional contract, for 200 toilet flushes or whatever. New manufacturing challenges, but at least you're getting the paperwork down.

After a few more jobs, you've cracked it. You start bidding for all the military's bathroom-related contracts. At five or six contracts a year, you have a million or two rolling in (and low manufacturing costs - remember, the spec is such that you can produce it for 80x lower) and you've hired five employees.

By year five, the only thing you care about improving is sales. You still have 5 machine shop staff, paid well but not enough to make them wealthy. You focus on hiring ex-military brass and making them sales reps and lobbyists. You're into tens of millions of revenue, that is, profit.

Year 8, you sell the thing to Northrop or to a private equity firm and go retire on an island.

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1. ryandvm ◴[] No.42204424[source]
I worked on a government software contractor that ended up growing from 10 people to 300 people in about 8 years and sold to Booz Allen Hamilton for around $50 million. You absolutely nailed it.

Sadly I didn't get much of a payday out of it.

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2. rrr_oh_man ◴[] No.42210438[source]
Any thought what you should have done differently, with the information available at the time?