5 ms·

That is unreal. Fountain soda/pop is already dirt cheap for vendors.

jdmichal 7y ago
It's not about cost, it's about profit. It doesn't matter that it's dirt cheap, it matters that they can sell it for >>>dirt cheap.
rainyMammoth 7y ago
you don't seem to understand the concept of opportunity cost. In this case what is the optimal maximum they can extract for this product. The production cost is almost irrelevant.
- 52-6F-62 7y ago
  No I understand perfectly well. What I find amazing is the dedication to extracting potentially a little more money from people who may buy one extra cola rather than allowing a refill when the production cost is next to 0, but leaves a more satisfied, and likely return, customer. Practices like this are likely to turn people off. The fact that they think they can do something like this just displays how much of a monopoly/duopoly this company actually knows it enjoys. Where else will their customers turn? There's nowhere to turn. So gouge them.
WalterBright 7y ago
Back in the olden days (1970s) the organization I was with threw a party. My job was to go to the local McD's and get some gallon boxes of syrup. This was then mixed at the party with carbonated water to make Coke. The interesting thing was I realized that the syrup cost $.03 per cup, and McD's was selling it for - I don't remember 45 years later but it was a lot. Puzzled, I asked about it and was told that McD's lost money on the hamburgers and more than made it up with the drinks and fries. It's also how movie theaters make money. They lose it on ticket sales, and make it up at the concession stand, especially on the soda. Similarly for restaurants. The drinks are the big moneymakers. Camera makers don't make money on the camera bodies, but on the lenses and accessories. Car dealers don't make money selling cars, they make it on the financing and the service.
- darkkindness 7y ago
  This is insightful. It also massively calls into question if economic models on prices (CPI?) could ever keep up with reality, if trends like shrinkflation didn't make that impossible already.
- 52-6F-62 7y ago
  My partner worked high up in a local small chain of boardgame cafes. She would stress how little it cost and how much profit was made on those drinks. I don't think the syrup costs much more than that, now! Somewhere in the few cents a glass range, and they can easily charge $2-4 for a pint of cola now.

It's not about cost, it's about profit. It doesn't matter that it's dirt cheap, it matters that they can sell it for >>>dirt cheap.

rainyMammoth 7y ago

you don't seem to understand the concept of opportunity cost. In this case what is the optimal maximum they can extract for this product. The production cost is almost irrelevant.

52-6F-62 7y ago
No I understand perfectly well. What I find amazing is the dedication to extracting potentially a little more money from people who may buy one extra cola rather than allowing a refill when the production cost is next to 0, but leaves a more satisfied, and likely return, customer. Practices like this are likely to turn people off. The fact that they think they can do something like this just displays how much of a monopoly/duopoly this company actually knows it enjoys. Where else will their customers turn? There's nowhere to turn. So gouge them.

WalterBright 7y ago

Back in the olden days (1970s) the organization I was with threw a party. My job was to go to the local McD's and get some gallon boxes of syrup. This was then mixed at the party with carbonated water to make Coke. The interesting thing was I realized that the syrup cost $.03 per cup, and McD's was selling it for - I don't remember 45 years later but it was a lot. Puzzled, I asked about it and was told that McD's lost money on the hamburgers and more than made it up with the drinks and fries. It's also how movie theaters make money. They lose it on ticket sales, and make it up at the concession stand, especially on the soda. Similarly for restaurants. The drinks are the big moneymakers. Camera makers don't make money on the camera bodies, but on the lenses and accessories. Car dealers don't make money selling cars, they make it on the financing and the service.

darkkindness 7y ago
This is insightful. It also massively calls into question if economic models on prices (CPI?) could ever keep up with reality, if trends like shrinkflation didn't make that impossible already.
52-6F-62 7y ago
My partner worked high up in a local small chain of boardgame cafes. She would stress how little it cost and how much profit was made on those drinks. I don't think the syrup costs much more than that, now! Somewhere in the few cents a glass range, and they can easily charge $2-4 for a pint of cola now.