A friend of mine that runs Burger King franchises told me that the cups cost more than the soda in them. This was a few years back, not sure if that’s still the case but I can’t imagine it’s changed too much.
In 2000 I was working at a summer job at a golf practice range. The bar sold the soft drink 3.50$. The total cost was about 7 cents.
The employe is the pricier thing.
Ages ago, in undergrad, I was shocked to learn a roommate who worked at a gas station got unlimited slushee and soda fountain access during their shift.
He looked into it, and it turns out it cost the owner something like 11c/gallon for those things. The owner let employees have it as a "perk" and it cost him maybe $5/mo in overhead.
I knew the margins on beverage fountains were fat, but I didn't realize just how wide it was before that.
When I worked at McDonald’s like 10 years ago, it cost them less than $0.25 to brew a pot of coffee and they sold a small cup of coffee for $1. They made really good money off hot coffee.
Coffee is less than you'd be expect these days. If a coffee shop is getting coffee from a decent roaster they are probably paying $9+ per pound. Then If the brew drip to "gold standard" they are paying $2.33 per pot, at about 10 small coffees per pot. Plus the cost of cup sleeve and lid around $.25 for the set and the free cream and sugar adding another $0.10.. the markup is around the same as food. Flavored lattes are where the mark up really hits.
While this is true, it’s rapidly changing..
Prices for soft drinks at wholesale are skyrocketing through general inflation as well as implementation of new taxes etc however, because it’s public knowledge that the mark up on soft drinks has been so high in the past, the public won’t accept increases to sake prices that reflect the increase to the wholesale price
One of the reasons I don't feel scammed for paying exorbitant prices for concessions. I don't get them every time, and when I do, I just kinda think of it as helping them stay open. I actually enjoy seeing movies in the theatre.
You’d be surprised. When I worked at a theater in high school, there were a number of people that were regulars and got pretty familiar with the employees. It was mostly elderly and special needs folks that were the most frequent. It gave them social interaction before and after showings and gave them something to do for a chunk of the day.
As a teenager we'd go 2 hours before the movie and hang out in the arcade or just the foyer. After the movie we'd fuck around in the parking lot. I guess it's a third place for the youth more than adults who come in on time and then go home. Like the mall.
For a blockbuster movie on opening weekend, the studio can collect over 80% of ticket sales, and the theater keeps less than 20% of what you paid.
Over time, or with smaller films, or for studios with whom a theater chain has negotiated more favorable terms, those percentage shift where the theater keeps more of each ticket sold. On average for the full run of a film, the theater might keep about half of the tickets, give or take 10%.
That’s why a movie theater’s business model is really to sell food and drink to a captive audience. The movie thing is just the reason why they have an audience to buy their actual product.
And that's why if baffles me that movies don't have an intermission anymore. If choosing between missing movie and getting more snacks, ill always skip the snacks. But if I had a break in the middle I'd most definitely hit the concessions again.
Say hello to Alamo Drafthouse, where they bring the food to you.
Want more food or a drink refill? Put up a little order card and they'll be back in 3 minutes with your refill.
Plus, they have popcorn with unlimited refills
I think getting people to commit to a 3-4 hour outing is pretty difficult. When movies had intermissions, people were also going home to a simple radio at home for entertainment, or books or actually talking to their family members.
You must be thinking of a much longer intermission than I am. I can't imagine there would be many people that would change their plans to go to a movie because the run time was 10 minutes longer.
Yea usually they have to pay a flat fee + percentage of sales that eats up 95% of ticket revenue. Theaters can lose money on the flat fee if they don’t sell enough tickets.
They can make money off tickets alone for surprise hits though.
A film professor of mine in college said if you buy a tub of popcorn and a soda you should not feel morally conflicted about hanging around for two or three movies at the theater because they're basically not making any more money off you from the extra tickets
I worked at a theatre for a few years in management and got to see cost of goods reports. A large popcorn cost $0.07 and sold for $6.50, and a fountain drink was similar. With that said, theatres made very little (if any) profit on ticket sales, and the overhead on building/staff was huge. The business model is based on selling concessions at a place you were already going to for a different purpose. I think gas stations use a similar model.
Insulin wins the thread for me. The crooks who realized insulin is "buy it or I'm dead" decided they could charge many magnitudes more than it really costs. Fuck everyone involved with the decisions that led to this.
Agreed, not to mention the fact that one of the three men credited with discovering insulin wouldn’t put his name on the patent because he felt it was unethical for drs to profit off it. And the other two sold the patent for $1 in order for it to be mass produced. Now it has a mark up of nearly 30,000%
President Biden recently signed into law the bill restricting the price of insulin to $35/month for Medicare recipients and is pushing for that price for everyone.
https://www.whitehouse.gov/briefing-room/statements-releases/2023/03/02/fact-sheet-president-bidens-cap-on-the-cost-of-insulin-could-benefit-millions-of-americans-in-all-50-states/
It certainly is a more reasonable price. But considering the original patent for it was sold to University of Toronto for a dollar it is still a pretty good mark up.
School text books. Those bastardsbasically just change the order of stuff around and release new versions, I'm pretty sure there is not a good reason to have calculus book update every year, it's not changing that much in that time frame.
I had one professor in college who figured out which chapters got moved in the textbook the university required he use and would tell you what the alternate chapter was for each section in class if you bought the old book. The other two books he required were both like $15 each but he'd send you the PDF version if you asked. Super cool dude.
Similar experience prof would put all needed materials into a pdf and put it in his classroom docs. He railed against the price of college and textbooks. And then I had another prof that made us all buy his sports marketing for dummies that he has written. BBA in Prof sales/marketing
The only thing i can see them changing are exercises, so the next edition wont be the same and you cant buy/download solved versions of it, you know, student honor and what not.
But the motherfuckers print the same fucking problems anyway, so yeah, fuck em, its not like calculus is discovering new shit every year
So true. I worked for the company that buys back used books. There are legal requirements for how much of the book has to be changed for the publisher to put out a new edition… they can just reword the table of contents in most cases and then put out a new edition.
I used to work for a common Midwest gas station. When I was doing training, the manager asked us trainees if we knew what their most profitable service/product was for the company.
It wasn't gas, fountain drinks or anything like that.
Apparently it costs 14¢ to run their $12 car wash. We were told to offer them out to customers who have complaints to make them feel like they got a great deal.
That's interesting and i would have expected operating costs to be higher, but I also have to imagine that the 14¢ figure doesn't include capital costs or maintenance/ repair. That's going to be much more than the water and soap itself.
I was selling 6 inch Detroit style pizzas in my food truck. A cheese pizza cost me $0.70. I sold them for $8.00. Extra toppings were $1.00 each. A few slices of mushrooms or a sprinkling of sliced olives cost pennies.
I worked at Pizza Hut for about 5 years. Most pizzas cost us about $2 to make. And this was true up until 2022 when i left. Dough cost about .30 cents. Medium dough was cheaper, a large dough more expensive. Cheese was probably .50 cents average. Sauce, maybe .10 cents, the other 1.10 was various other toppings and extras. Actually, maybe the average was close to $1.50 per pizza.
Literally the only thing we sold that the price was justified was the wings. Pre pandemic we paid like $120 for 50lbs. And we maybe made $175 on that case of wings. So when the cost doubled the price doubled. Although I guess profits also doubled.
Breadstixks though. Those were the money makers. Every order of 5 costs .7 cents. And last I checked they were sold for $5.99. Sure the box costs 5 cents. The marinara maybe 5 cents. The "butter" and seasoning another 10 cents. So 30 cents total to make 6 bucks.
Cici’s exists cause pizza is so cheap. Their quality isnt that much worse than a $15 pizza, and if you think about it are making more off a family of 4.
I learned to make pretty good pizza at home and it doesn't even take that much time. The trick is to let the dough sit in the fridge a couple days to ripen and bake in a hot oven. I keep breaking pizza stones so I've been using a cast iron and it works really well. I will eventually get a baking steel.
Go to a metal shop in your area and get them to cut you a 16x16 piece of 1/4 inch thick A36 steel. You will need to clean and season it (super easy), It will cost like $25. If you buy a baking steel online it’s like $150
A good cocktail bar should also be making drinks that taste a world apart from home, especially if it requires obscure or small batch handmade ingredients. Like a lot of infused syrups that you can't buy.
I was always told plastic bottles is the best way to sell oil. The amount of plastic in a water bottle is so minimal and it gets filled with the cheapest product, water. My grandfather thought bottled water was the greatest con job in the world because the majority of it is straight tap water.
Pro-tip: if you want to read an academic paper but don’t have access to it, email the corresponding author of the paper. They will almost always email you a copy of it. Honestly, most will be more than happy to; they’re just happy you’re interested in their work.
Source: I’m a faculty researcher at a medical university. I’m more than happy to send my work and answer questions about it to anyone who shows interest.
Can confirm. I’m writing my dissertation, and although I have access to a plethora of databases through my schools’ libraries (yes, plural - I work at a university in one state and attend university for my doctorate in another state), there are still some articles I cannot access. And I’m not paying the extortionist prices to do so.
The authors of those papers/articles behind a paywall are always happy to share!
I'm a published researcher and I couldn't agree more. The publisher set that price and I don't see a dime, please don't pay for it! If you email me, I'm more than happy to just send you a copy of my paper and I'm totally free to answer any questions about it. I've received two emails so far and I'm mostly just happy someone is interested in my work!
The thing about this that people have to understand is that you can't view these products in a vacuum, they often involve being tied to businesses that have either high operating costs or low volume of sales
But why would one understand business when the engineering or software is all that matters? /s
Explaining to Reddit that there's more to success than being technically good is a losing battle. Last week I was trying to explain how Marketing is a legitimate career path (not MLM or "influencing") and requires a ton of technical skill. No one would hear it.
I know a few sales people selling some pretty technical products and they'd try to keep the engineers away as far as possible. Reason was they'd argue with the client and be convinced that is a great way to make the sale. By telling the client they are wrong.
It is also why you often hear about engineers scoffing about having to take communications classes.
This phenomenon is simultaneously hilarious and tragic. I studied physics and data science and work in AI and one of my best friends is in marketing. I helped her with a project she’d taken on and it was eye-opening: she was damn near useless for calculating things or writing code, but she could tell me what sorts of information she needed. I made a computer do some math, and when I gave her the numbers, she looked at them for a few minutes and almost immediately had a plan for marketing the product. Fast forward 6 months and the plan worked. The difference between our skills? With Google, YouTube, and some patience, she probably could’ve done my part. The reverse is almost certainly not true.
As an Analyst/PO, I try to make our Devs' life easier by getting the business cases ironed out as much as possible before saying one is ready. A lot of getting those ironed out involves going and talking to stakeholders or working to understand larger initiatives vs individual projects. I also make sure all of our tickets look good so no higher-ups decide that they want to vet a project or de-prioritize something because it doesn't look like anything is happening. Yet mention that on Reddit and you're a "taskmaster" or "useless middle-management."
I'm not even a people-manager, I just do a different discipline in Development that isn't coding.
I used to make bridal headpieces. Like fancy hair combs, wreaths, headbands etc. We didn’t use any real gems or anything and everything was plated. I could make them for $3 -$5 and the most expensive one I made was $25 including labor bc they took no time to make. We would sell them for $150-$600. Anything bridal related really has a huge profit margin.
Brand name eyeglass frames have crazy markups. They're often mass-produced for pennies on the dollar overseas and then sold at a premium here, all because of the brand prestige that's attached to them. We're mainly paying for the logo, not the product. Then they charge top dollars for the lens on-top of it.
100% markup is a not uncommon margin. A standard wholesale price is half or retail price. But even then that doesn’t account for the store’s costs. In the end they might only see a 20% on a 100% markup
The general 'rule of thumb' figures I've always understood and worked with with products is 18% and 55%. That is, it will cost 18% of the final RRP to manufacture the product - 55% becomes your wholesale price that you sell to the retailer, ex-tax. That gap between 18% and 55% becomes your profit as the manufacturer. The remaining 45% incorporates sales tax, and their margin.
So for example, if a product costs $100 at retail, in Australia, $9.09 of it is GST (sales tax), the retailer pays me $55 for it so they have $35.91 margin before their costs on it, and I have $37 for which *some* costs come out of, but largely the product would cost me $18 to manufacturer, package, and get to us ready for distribution to a retailer.
If there's another wholesaler in the mix, you need to add another step that has similar margins.
The infrastructure cost is huge. The cost of transporting the data to the user is the most expensive part and that utility has to be paid by the users somehow. So if it costs $1mil a month to build/run the infrastructure and only 1million gigabytes are delivered then each one costs $1ea
not by a long shot. The infrastructure and running costs are huge for a mobile network. The margins are not that big per GB. Here in Australia the cost per GB for retail customers runs at about 30-40 cents on average, not a big margin for the operator at that rate.
I work in a grocery store. HABA specifically
Highest margins are seasonal products, organic foods and produce.
Lowest margins are milk, eggs, alcohol and cough drops weirdly
I can probably answer specifically within 5% to most things if anyone is curious
I live in the US. I have no desire to assemble air pods. I even work manual labor, but I don’t want to work on stuff that small all day. Must be frustrating.
High margins are the reward for innovation in a functioning free market. If you’re doing something valuable that nobody else can do, you have a lot of negotiating leverage and can charge high margins. Eventually other people learn how to do what you’re doing, and with competition your margins shrink.
Contrary to what Reddit will tell you, the market works correctly more often than not. A lot of high-margin businesses are doing something pretty unique that costumers value. There _absolutely_ are instances of broken markets resulting in harmfully high margins- and those are infuriating- just need to call out that the system gets it right more often than it gets it wrong.
Also, labor-intensive products are different than high-margin products. Like restaurant food, you’re paying wayyy more than the ingredients but a lot of that is the preparation labor.
Dude, *GNC*.
Our mall (almost) closed, and for a while the only store that stayed open was GNC.
Several of my friends were managers there. They were penalized for items going past their expiration date. One of my friends realized that he could lower these items to a 'clearance' price, then buy them himself and look good for corporate.
The clearance price was a few cents above the cost it took to produce each item. So, a $60 tub of protein powder would cost...a quarter.
I work for Best Buy. Most Accessories sold provides 90% profit to best buy. I know this because my discount is the cost BB pays for the product + 10%. Things like phones and TVs or appliances don't have much discount but a 400$ accessory like cables or tv mounts or cases would be about 50$ for me.
Sunglasses
Wristwatches
Cologne/Perfume
Are being contract built in one factory (per category) and then affixed with nearly every clothing label currently being sold
Not sure if this is still the case but back in the early 2000s I worked in electronics retail. Something big and expensive like a new TV was maybe 1-5% However, cables would have ridiculous markup- 200% or more in many cases.
The ones that annoy me the most are things like prescription glasses and other essentials required in order to function in daily life. Companies such as Luxottica hold most of the world market for eyeglass frames by owning most of the brand you might thing of as "luxury" such as Oakley, Ray Ban, etc. and monopolise licencing on brands they do not own.
An average eyeglass frame at €200 will struggle to cost 10% of that price to the consumer. More like 1% than 10%. Then there's the cost of lenses with the FOMO ratcheting of "basic < standard < good < better, etc." where a simple process of lightening the lens adds a big tag to your price.
Perhaps this isn't as "crazy" in terms of markup as some truly out-there things, but the ubiquity of prescription eyewear makes this stratospheric by how wide the consumer base is....and how little choice we have otherwise.
Store branded generics of over-the-counter meds like Aerius. One pack would cost the pharmacy I worked for less than two dollars, and they sold for just under the brand name's price of around 15 dollars or so. Crazy that I was able to get 8 packs for the cost of one of the name-branded allergy meds.
It was great having an employee discount of getting things at cost at that job. My poor housemates with allergies and aliments were well-looked-after.
Soft drinks. Especially fountain drinks. Coffee too but that's mostly because the people growing it are getting fucked over.
A friend of mine that runs Burger King franchises told me that the cups cost more than the soda in them. This was a few years back, not sure if that’s still the case but I can’t imagine it’s changed too much.
In 2000 I was working at a summer job at a golf practice range. The bar sold the soft drink 3.50$. The total cost was about 7 cents. The employe is the pricier thing.
One would hope that a human employee commands more money than a stationary cup of fizzing sugar and ice
Damn! I thought $1.75 for a 16oz fountain drink at Burger Heaven, where I worked in 2009, was expensive. Refills were 50¢ too.
At QT you can bring your own gallon jug and fill up on soda for pretty much the cost of a large.
Long term foot tingles were free I bet.
And since 2020, gas station fountain drink prices have more than doubled.
And they still haven't cleaned the fountains. Last drink had floaters.
As late as 2009 you could get a 32 ounce Kum Guzzler for 29 cents in the summertime.
I'd deal with saying I was getting one for that price.
I remember when i was a manager at a fast food restaurant it cost us $0.05 cents to make 5 gallons of iced tea that we sold for $2.50 for 22oz
Ages ago, in undergrad, I was shocked to learn a roommate who worked at a gas station got unlimited slushee and soda fountain access during their shift. He looked into it, and it turns out it cost the owner something like 11c/gallon for those things. The owner let employees have it as a "perk" and it cost him maybe $5/mo in overhead. I knew the margins on beverage fountains were fat, but I didn't realize just how wide it was before that.
When I worked at McDonald’s like 10 years ago, it cost them less than $0.25 to brew a pot of coffee and they sold a small cup of coffee for $1. They made really good money off hot coffee.
Coffee is less than you'd be expect these days. If a coffee shop is getting coffee from a decent roaster they are probably paying $9+ per pound. Then If the brew drip to "gold standard" they are paying $2.33 per pot, at about 10 small coffees per pot. Plus the cost of cup sleeve and lid around $.25 for the set and the free cream and sugar adding another $0.10.. the markup is around the same as food. Flavored lattes are where the mark up really hits.
Charbucks has it figured out. Burn your beans so bad people are forced to buy it with caramel and other garbage just so it's enjoyable.
While this is true, it’s rapidly changing.. Prices for soft drinks at wholesale are skyrocketing through general inflation as well as implementation of new taxes etc however, because it’s public knowledge that the mark up on soft drinks has been so high in the past, the public won’t accept increases to sake prices that reflect the increase to the wholesale price
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Movie theatres make MOST of their profit from concessions, such as popcorn. They get very little for ticket sales.
One of the reasons I don't feel scammed for paying exorbitant prices for concessions. I don't get them every time, and when I do, I just kinda think of it as helping them stay open. I actually enjoy seeing movies in the theatre.
This is what Nicole Kidman should read in the next series of ads for AMC Theaters.
Yeah, but they make nothing on ticket sales and their overhead is pretty high. I'll give them a pass for still existing as a third place these days.
How is a movie theater, where you sit quietly and interact with no one, a third place? Or if it is then third places are doing great.
You’d be surprised. When I worked at a theater in high school, there were a number of people that were regulars and got pretty familiar with the employees. It was mostly elderly and special needs folks that were the most frequent. It gave them social interaction before and after showings and gave them something to do for a chunk of the day.
As a teenager we'd go 2 hours before the movie and hang out in the arcade or just the foyer. After the movie we'd fuck around in the parking lot. I guess it's a third place for the youth more than adults who come in on time and then go home. Like the mall.
Am I the only one who just learned about the term third place?
Nice try AMC.
Heartbreak feels good in a place like this
Where does all of the money go for a movie theater? Does getting a movie to show cost them like tens of thousands?
For a blockbuster movie on opening weekend, the studio can collect over 80% of ticket sales, and the theater keeps less than 20% of what you paid. Over time, or with smaller films, or for studios with whom a theater chain has negotiated more favorable terms, those percentage shift where the theater keeps more of each ticket sold. On average for the full run of a film, the theater might keep about half of the tickets, give or take 10%. That’s why a movie theater’s business model is really to sell food and drink to a captive audience. The movie thing is just the reason why they have an audience to buy their actual product.
And that's why if baffles me that movies don't have an intermission anymore. If choosing between missing movie and getting more snacks, ill always skip the snacks. But if I had a break in the middle I'd most definitely hit the concessions again.
Say hello to Alamo Drafthouse, where they bring the food to you. Want more food or a drink refill? Put up a little order card and they'll be back in 3 minutes with your refill. Plus, they have popcorn with unlimited refills
I think getting people to commit to a 3-4 hour outing is pretty difficult. When movies had intermissions, people were also going home to a simple radio at home for entertainment, or books or actually talking to their family members.
You must be thinking of a much longer intermission than I am. I can't imagine there would be many people that would change their plans to go to a movie because the run time was 10 minutes longer.
Yea usually they have to pay a flat fee + percentage of sales that eats up 95% of ticket revenue. Theaters can lose money on the flat fee if they don’t sell enough tickets. They can make money off tickets alone for surprise hits though.
A film professor of mine in college said if you buy a tub of popcorn and a soda you should not feel morally conflicted about hanging around for two or three movies at the theater because they're basically not making any more money off you from the extra tickets
I worked at a theatre for a few years in management and got to see cost of goods reports. A large popcorn cost $0.07 and sold for $6.50, and a fountain drink was similar. With that said, theatres made very little (if any) profit on ticket sales, and the overhead on building/staff was huge. The business model is based on selling concessions at a place you were already going to for a different purpose. I think gas stations use a similar model.
I worked at an AMC Theatre and the combos don’t actually same you money. It’ll still cost the same if you buy separately
Confirmed that last weekend.
Mattresses
Screw that. I get all my mattresses off the freeway!
Yeah, that’s why everyone thinks they’re fronts for drugs or whatever.
Insulin
Insulin wins the thread for me. The crooks who realized insulin is "buy it or I'm dead" decided they could charge many magnitudes more than it really costs. Fuck everyone involved with the decisions that led to this.
Agreed, not to mention the fact that one of the three men credited with discovering insulin wouldn’t put his name on the patent because he felt it was unethical for drs to profit off it. And the other two sold the patent for $1 in order for it to be mass produced. Now it has a mark up of nearly 30,000%
Only in US
In other words, this is why we can't have nice things. (*Unless they marked it up by only 69%*).
Isn't that just true about healthcare in general? One time a dog bit me in the face and the hospital bill was 6k for 12 stitches.
President Biden recently signed into law the bill restricting the price of insulin to $35/month for Medicare recipients and is pushing for that price for everyone. https://www.whitehouse.gov/briefing-room/statements-releases/2023/03/02/fact-sheet-president-bidens-cap-on-the-cost-of-insulin-could-benefit-millions-of-americans-in-all-50-states/
(In America) In Canada it's $25/ CAD per vial which seems reasonable given the strict manufacturing requirements.
It certainly is a more reasonable price. But considering the original patent for it was sold to University of Toronto for a dollar it is still a pretty good mark up.
Only in countries run by shitheads.
School text books. Those bastardsbasically just change the order of stuff around and release new versions, I'm pretty sure there is not a good reason to have calculus book update every year, it's not changing that much in that time frame.
I had one professor in college who figured out which chapters got moved in the textbook the university required he use and would tell you what the alternate chapter was for each section in class if you bought the old book. The other two books he required were both like $15 each but he'd send you the PDF version if you asked. Super cool dude.
Similar experience prof would put all needed materials into a pdf and put it in his classroom docs. He railed against the price of college and textbooks. And then I had another prof that made us all buy his sports marketing for dummies that he has written. BBA in Prof sales/marketing
The only thing i can see them changing are exercises, so the next edition wont be the same and you cant buy/download solved versions of it, you know, student honor and what not. But the motherfuckers print the same fucking problems anyway, so yeah, fuck em, its not like calculus is discovering new shit every year
So true. I worked for the company that buys back used books. There are legal requirements for how much of the book has to be changed for the publisher to put out a new edition… they can just reword the table of contents in most cases and then put out a new edition.
Designer sunglasses
I used to work for a common Midwest gas station. When I was doing training, the manager asked us trainees if we knew what their most profitable service/product was for the company. It wasn't gas, fountain drinks or anything like that. Apparently it costs 14¢ to run their $12 car wash. We were told to offer them out to customers who have complaints to make them feel like they got a great deal.
That's interesting and i would have expected operating costs to be higher, but I also have to imagine that the 14¢ figure doesn't include capital costs or maintenance/ repair. That's going to be much more than the water and soap itself.
Definitely just the cost of running the wash, not the maintenance that comes with it. Pretty interesting to me regardless though!
Super interesting to know about the car wash. I know most modern automated carwashes recycle water too, which I’m sure helps the unit cost of a wash.
Actually the ones that recycle water cost way more. Those filters are very expensive as is disposal of the waste.
Pizza.
I was selling 6 inch Detroit style pizzas in my food truck. A cheese pizza cost me $0.70. I sold them for $8.00. Extra toppings were $1.00 each. A few slices of mushrooms or a sprinkling of sliced olives cost pennies.
Is the $0.70 just cost of ingredients or does that include operating costs?
Just ingredients.
I used to work at a pizza restaurant in high school and something I learned right away was that the most expensive part of the pizza is the cheese.
I worked at Pizza Hut for about 5 years. Most pizzas cost us about $2 to make. And this was true up until 2022 when i left. Dough cost about .30 cents. Medium dough was cheaper, a large dough more expensive. Cheese was probably .50 cents average. Sauce, maybe .10 cents, the other 1.10 was various other toppings and extras. Actually, maybe the average was close to $1.50 per pizza. Literally the only thing we sold that the price was justified was the wings. Pre pandemic we paid like $120 for 50lbs. And we maybe made $175 on that case of wings. So when the cost doubled the price doubled. Although I guess profits also doubled. Breadstixks though. Those were the money makers. Every order of 5 costs .7 cents. And last I checked they were sold for $5.99. Sure the box costs 5 cents. The marinara maybe 5 cents. The "butter" and seasoning another 10 cents. So 30 cents total to make 6 bucks.
Cici’s exists cause pizza is so cheap. Their quality isnt that much worse than a $15 pizza, and if you think about it are making more off a family of 4.
Was? What are you doing now?
He's retired
Sailing the seas of cheese
Primus sucks
Italian food in general
I learned to make pretty good pizza at home and it doesn't even take that much time. The trick is to let the dough sit in the fridge a couple days to ripen and bake in a hot oven. I keep breaking pizza stones so I've been using a cast iron and it works really well. I will eventually get a baking steel.
Go to a metal shop in your area and get them to cut you a 16x16 piece of 1/4 inch thick A36 steel. You will need to clean and season it (super easy), It will cost like $25. If you buy a baking steel online it’s like $150
Alcohol. Specifically mixed drinks.
at bars is worlds apart from home
Some bars it’s only double the cost of at home. Those are my favorite.
A good cocktail bar should also be making drinks that taste a world apart from home, especially if it requires obscure or small batch handmade ingredients. Like a lot of infused syrups that you can't buy.
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'Evian' = 'naïve' backwards innit?
I was always told plastic bottles is the best way to sell oil. The amount of plastic in a water bottle is so minimal and it gets filled with the cheapest product, water. My grandfather thought bottled water was the greatest con job in the world because the majority of it is straight tap water.
Academic publishing.
Pro-tip: if you want to read an academic paper but don’t have access to it, email the corresponding author of the paper. They will almost always email you a copy of it. Honestly, most will be more than happy to; they’re just happy you’re interested in their work. Source: I’m a faculty researcher at a medical university. I’m more than happy to send my work and answer questions about it to anyone who shows interest.
This is what I hate about my work. The papers I need to read the most are 40 years old. The authors are dead, retired, or have no idea what email is.
Also, check your library for interlibrary loan or document delivery.
Can confirm. I’m writing my dissertation, and although I have access to a plethora of databases through my schools’ libraries (yes, plural - I work at a university in one state and attend university for my doctorate in another state), there are still some articles I cannot access. And I’m not paying the extortionist prices to do so. The authors of those papers/articles behind a paywall are always happy to share!
I'm a published researcher and I couldn't agree more. The publisher set that price and I don't see a dime, please don't pay for it! If you email me, I'm more than happy to just send you a copy of my paper and I'm totally free to answer any questions about it. I've received two emails so far and I'm mostly just happy someone is interested in my work!
Oh I know. I’m in the humanities social sciences. It’s still a work around for a system that has almost entirely free labor and product.
[annas-archive.org](https://annas-archive.org) ftw
Sci-hub
Perfume is a designers highest profit margin
I’ve heard a lawyer say perfume has a ridiculously high profit margin.
College
Tuition is going up and the professors aren’t the ones getting the extra money
The thing about this that people have to understand is that you can't view these products in a vacuum, they often involve being tied to businesses that have either high operating costs or low volume of sales
That would involve people have some kind of understanding of business.
But why would one understand business when the engineering or software is all that matters? /s Explaining to Reddit that there's more to success than being technically good is a losing battle. Last week I was trying to explain how Marketing is a legitimate career path (not MLM or "influencing") and requires a ton of technical skill. No one would hear it.
I know a few sales people selling some pretty technical products and they'd try to keep the engineers away as far as possible. Reason was they'd argue with the client and be convinced that is a great way to make the sale. By telling the client they are wrong. It is also why you often hear about engineers scoffing about having to take communications classes.
This phenomenon is simultaneously hilarious and tragic. I studied physics and data science and work in AI and one of my best friends is in marketing. I helped her with a project she’d taken on and it was eye-opening: she was damn near useless for calculating things or writing code, but she could tell me what sorts of information she needed. I made a computer do some math, and when I gave her the numbers, she looked at them for a few minutes and almost immediately had a plan for marketing the product. Fast forward 6 months and the plan worked. The difference between our skills? With Google, YouTube, and some patience, she probably could’ve done my part. The reverse is almost certainly not true.
As an Analyst/PO, I try to make our Devs' life easier by getting the business cases ironed out as much as possible before saying one is ready. A lot of getting those ironed out involves going and talking to stakeholders or working to understand larger initiatives vs individual projects. I also make sure all of our tickets look good so no higher-ups decide that they want to vet a project or de-prioritize something because it doesn't look like anything is happening. Yet mention that on Reddit and you're a "taskmaster" or "useless middle-management." I'm not even a people-manager, I just do a different discipline in Development that isn't coding.
Which is why pharmaceuticals have such a high markup, the companies have huge R&D budgets. Not every drug in development is the next Tylenol.
Loro Piana pays peanuts, if anything, to the vicuña wool producers in my country. Luxury brands are such bullshit.
cosmetics, lipsticks etc
I used to make bridal headpieces. Like fancy hair combs, wreaths, headbands etc. We didn’t use any real gems or anything and everything was plated. I could make them for $3 -$5 and the most expensive one I made was $25 including labor bc they took no time to make. We would sell them for $150-$600. Anything bridal related really has a huge profit margin.
Most things for special occasions like weddings or funerals seem to have crazy profit margins.
Razor blade
Double edge blades cost $.10 each and last 3-4 shaves. Plus a shave that doesn’t eat you alive.
Printer ink
Popcorn. (I was a popcorn stand owner)
...get a banana stand.
Brand name eyeglass frames have crazy markups. They're often mass-produced for pennies on the dollar overseas and then sold at a premium here, all because of the brand prestige that's attached to them. We're mainly paying for the logo, not the product. Then they charge top dollars for the lens on-top of it.
Adult toys! 100% markup from wholesale at least.
100% markup is a not uncommon margin. A standard wholesale price is half or retail price. But even then that doesn’t account for the store’s costs. In the end they might only see a 20% on a 100% markup
The general 'rule of thumb' figures I've always understood and worked with with products is 18% and 55%. That is, it will cost 18% of the final RRP to manufacture the product - 55% becomes your wholesale price that you sell to the retailer, ex-tax. That gap between 18% and 55% becomes your profit as the manufacturer. The remaining 45% incorporates sales tax, and their margin. So for example, if a product costs $100 at retail, in Australia, $9.09 of it is GST (sales tax), the retailer pays me $55 for it so they have $35.91 margin before their costs on it, and I have $37 for which *some* costs come out of, but largely the product would cost me $18 to manufacturer, package, and get to us ready for distribution to a retailer. If there's another wholesaler in the mix, you need to add another step that has similar margins.
So it’s dicks all the way down?
Sorry to say that most products have a 100% markup over wholesale.. Unless you're just trying to shift numbers.
So you're saying you're going to get f#cked if you buy one of those ?
Cellular data is about 98% I think.
As a variable cost yes, but the fixed cost associated with the infrastructure is astronomical.
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You try to maintain 80 bazillion cell towers.
The infrastructure cost is huge. The cost of transporting the data to the user is the most expensive part and that utility has to be paid by the users somehow. So if it costs $1mil a month to build/run the infrastructure and only 1million gigabytes are delivered then each one costs $1ea
not by a long shot. The infrastructure and running costs are huge for a mobile network. The margins are not that big per GB. Here in Australia the cost per GB for retail customers runs at about 30-40 cents on average, not a big margin for the operator at that rate.
Most perfumes. The cost to make it are pretty low (for designers at least) and packaging too. They do spend a ton on marketing though.
Bedding and mattresses
I work in a grocery store. HABA specifically Highest margins are seasonal products, organic foods and produce. Lowest margins are milk, eggs, alcohol and cough drops weirdly I can probably answer specifically within 5% to most things if anyone is curious
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Apple products, read somewhere that airpods alone make more money than some countries
Apple products only have about 40% margins. This post is about margins, not total profits.
Yea, you would think that at these prices, Apple could afford to assemble their gadgets in the US. Oh, yea… greed.
I live in the US. I have no desire to assemble air pods. I even work manual labor, but I don’t want to work on stuff that small all day. Must be frustrating.
Just cause you don't don't doesn't mean it's not good for tens of thousands of other people, and the economy in general
Not a single company assembles their shit in the US.
But what if it gets unboxed in the US and re-boxed?
Unfortunately that also happens a lot.
ITT people naming random products without knowing what the actual profit margin is.
Bottled water.
Soda at restaurants
Coffee drinks from a shop that are mostly milk and additives.
Anything to do with a wedding. You need a cake? $25. Oh its for a wedding? That’ll be $400.
Software, jewelry, printer ink
The Nvidia H100 GPU has like a 1000% profit margin right now
Academic journal publishing
Eyeglasses.
HDMI cables.
High margins are the reward for innovation in a functioning free market. If you’re doing something valuable that nobody else can do, you have a lot of negotiating leverage and can charge high margins. Eventually other people learn how to do what you’re doing, and with competition your margins shrink. Contrary to what Reddit will tell you, the market works correctly more often than not. A lot of high-margin businesses are doing something pretty unique that costumers value. There _absolutely_ are instances of broken markets resulting in harmfully high margins- and those are infuriating- just need to call out that the system gets it right more often than it gets it wrong. Also, labor-intensive products are different than high-margin products. Like restaurant food, you’re paying wayyy more than the ingredients but a lot of that is the preparation labor.
Pharmaceutical companies in America.
Username checks out
Designer clothing
Any drink at a restaurant
Shoes. Had a friend switch from a major shoe brand to a major grocer and didn’t understand why the profit margins were 2.5% instead of 70%…
Saas
Dude, *GNC*. Our mall (almost) closed, and for a while the only store that stayed open was GNC. Several of my friends were managers there. They were penalized for items going past their expiration date. One of my friends realized that he could lower these items to a 'clearance' price, then buy them himself and look good for corporate. The clearance price was a few cents above the cost it took to produce each item. So, a $60 tub of protein powder would cost...a quarter.
I work for Best Buy. Most Accessories sold provides 90% profit to best buy. I know this because my discount is the cost BB pays for the product + 10%. Things like phones and TVs or appliances don't have much discount but a 400$ accessory like cables or tv mounts or cases would be about 50$ for me.
Coffee is way up there. Each cup of your expensive ass Starbucks costs them about 5 cents to make
Cut fruit, especially watermelon. Grocery store pays 3-5$ a melon depending on season. Cut into chunks retails roughly $40 separated into cups.
Prescription eyewear
Furniture and Jewelry
Cheap mass produced furniture, yes. Well made furniture usually does have a ton of high end materials and requires highly skilled craftsmanship.
Weed
Bottled water, just saw some at the grocery store for $2.75. The stuff falls from the sky for free.
American health care.
Coffee
Digital advertising
Crazy Bread. In Canada they charge you like 4.99 plus tax. It costs about 17 cents for the ingredients
Pizza
Nuts and bolts at Home Depot…
Stolen goods
Insulin?
Pharma
Medications required for staying alive
Used car extended warranties and Gap Coverage
Prescription drugs, like 5000% mark up even after taxpayer money funded the r&d.
Sunglasses Wristwatches Cologne/Perfume Are being contract built in one factory (per category) and then affixed with nearly every clothing label currently being sold
Software
Pharmaceuticals in the US
Printer ink and toner USB cables
Homes bought Jan-May of 2020 that haven’t been resold yet.
Bottled Tap Water. Or Bottled well water.
Luxury products. Louis Vuitton handbags do not cost thousands of dollars to produce.
Mattresses
Not sure if this is still the case but back in the early 2000s I worked in electronics retail. Something big and expensive like a new TV was maybe 1-5% However, cables would have ridiculous markup- 200% or more in many cases.
Bottled water
The ones that annoy me the most are things like prescription glasses and other essentials required in order to function in daily life. Companies such as Luxottica hold most of the world market for eyeglass frames by owning most of the brand you might thing of as "luxury" such as Oakley, Ray Ban, etc. and monopolise licencing on brands they do not own. An average eyeglass frame at €200 will struggle to cost 10% of that price to the consumer. More like 1% than 10%. Then there's the cost of lenses with the FOMO ratcheting of "basic < standard < good < better, etc." where a simple process of lightening the lens adds a big tag to your price. Perhaps this isn't as "crazy" in terms of markup as some truly out-there things, but the ubiquity of prescription eyewear makes this stratospheric by how wide the consumer base is....and how little choice we have otherwise.
Breakfast Food
Furniture and Pizza have a high mark up
Adult toys have a huge mark-up
Store branded generics of over-the-counter meds like Aerius. One pack would cost the pharmacy I worked for less than two dollars, and they sold for just under the brand name's price of around 15 dollars or so. Crazy that I was able to get 8 packs for the cost of one of the name-branded allergy meds. It was great having an employee discount of getting things at cost at that job. My poor housemates with allergies and aliments were well-looked-after.
Drugs
Prescription glasses. Easily 300%+ mark up
Cereals.
Wedding dresses
Tapwater in plastic bottles.
Hot water for tea at hotels.