As Trent has stated, the cost of the machinery is extremely expensive. I am a GR dealer and GR has told me what his costs were to start up and what his machines cost - and he designs and makes most of his equipment. Brass went up as well and everyone knows what gold costs now, but few realize silver went up as well - although not to the staggering cost of gold. Lets not forget the skill in the designs of the mouthpieces, either. Some schlepp off the street isn't going to design a mouthpiece.
As a business, these folks have taxes to pay and still make enough to to live on. The Bach Company sells thousands upon thousands upon thousands every year. That is why they can be so inexpensive.
Take $1000.00 and you can buy 3 Monette Pranas of your choice with a few bucks left for lunch. Go try to buy a new head joint for a flute with that $1000.00. You will be hard pressed to find a decent one, let alone a great one.