Reminds me of the college bookstore. They price the 1-liter soda's at 1.50 with the tax factored in, and the 12oz at 1.25 with tax factored in. The vending machines have em at 1.50 for the 12oz ones.
Needless to say, the bookstore flat-out schools the vending machines in profit on soda, even though the price is lower. The kid who sets the prices agrees that selling more volume at a lower per-unit profit is a lot better than selling low volume at a higher per-unit profit, since you end up getting more sales in the end. Walt On Sat, Sep 25, 2010 at 10:19 PM, Dieselhead <126die...@gmail.com> wrote: > That would be a 33% margin and yes overall that is probably close. Out of > that, all freight and op exp has to be paid. In reality, you have some low > margin or loss leaders you use to lure folks into the store. Then you have > normal items that have a 30-35% margin. And then you have the gravy items, > where you make 50 to 75% margin. ... and everything in between. Big > companies pay neilson billions to figure out the exact optimal price point > for profit. The point of consumer pain. In our small business, we had > things like spices that were around 60% margin. Lots of other items that > were around 30-40% margin and the things I called loss leaders or staples, > that you had to be competitive on. The overall goal was to have an average > margin of 40-45% and turn the inventory total value every month. The > second, velocity, is a key to profitability that most retailers (or > manufacturers) don't look at enough. Dr. Goldratt teaches focus on velocity > and strategic buffers. It makes a world of difference, but most bean > counters don't understand the TOC approach and how to use it. I just heard > a war story this morning form a guy who retired from the office > furniture/supply business. He was telling how their young MBA was going to > put them on "just in time" but didn't understand drum buffer rope or > strategic buffers. The result was disastrous, and took many years to > recover from. > >> They probably sell it at about 1.5x their cost. >> >> Rolf <r...@winmutt.com> writes: >> >>> Wow I cant believe they make any kind of profit margin on their crap :D >>> >>> On 9/23/2010 8:48 PM, Dieselhead wrote: >>>> >>>> Spoiled brats, even 50 yr old spoiled brats, ruin families and >>>> companies. >>>> >>>>> so in other words they will be out of business soon. That is sure >>>>> quite a few $20 power tools to sell to pay for all that stuff. >>>>> >>>>> On 9/21/2010 11:54 AM, Curt Raymond wrote: >>>>>> >>>>>> >>>>>> http://www.vcstar.com/news/2010/jul/19/harbor-freight-ceo-accused-by-parents-of-looting/ >>>>>> >>>>>> >>>>>> -Curt >>>> >>>> _______________________________________ >>>> http://www.okiebenz.com >>>> For new and used parts go to www.okiebenz.com >>>> To search list archives http://www.okiebenz.com/archive/ >>>> >>>> To Unsubscribe or change delivery options go to: >>>> http://okiebenz.com/mailman/listinfo/mercedes_okiebenz.com >>> >>> >>> _______________________________________ >>> http://www.okiebenz.com >>> For new and used parts go to www.okiebenz.com >>> To search list archives http://www.okiebenz.com/archive/ >>> >>> To Unsubscribe or change delivery options go to: >>> http://okiebenz.com/mailman/listinfo/mercedes_okiebenz.com >>> >> >> -- >> 1983 300D >> >> _______________________________________ >> http://www.okiebenz.com >> For new and used parts go to www.okiebenz.com >> To search list archives http://www.okiebenz.com/archive/ >> >> To Unsubscribe or change delivery options go to: >> http://okiebenz.com/mailman/listinfo/mercedes_okiebenz.com > > > _______________________________________ > http://www.okiebenz.com > For new and used parts go to www.okiebenz.com > To search list archives http://www.okiebenz.com/archive/ > > To Unsubscribe or change delivery options go to: > http://okiebenz.com/mailman/listinfo/mercedes_okiebenz.com > _______________________________________ http://www.okiebenz.com For new and used parts go to www.okiebenz.com To search list archives http://www.okiebenz.com/archive/ To Unsubscribe or change delivery options go to: http://okiebenz.com/mailman/listinfo/mercedes_okiebenz.com
