4 ms·

This isn't correct. Big brands virtually never skimp on product quality for smaller stores because it harms the long term equity and value. They customize quant

by sfifs 5y ago

This isn't correct. Big brands virtually never skimp on product quality for smaller stores because it harms the long term equity and value. They customize quantity.

raverbashing 5y ago
These products are so well optimized now they're mostly margin and packaging/shipping/handling cost. I doubt your toothpaste tube cost more than $0.50 in actual materials to make. And on a store this can go for $3? $4? (from a quick look in Amzn - approx values the cheapest one is $8 for 6)
- sfifs 5y ago
  CPG industry margins are quite public as almost big brands are owned by listed companies. They're not high. The highest margin categories for big retailers i believe tend to be clothing.
  - Scoundreller 5y ago
    They're not wrong about the big difference between production cost and selling price. CPGs are basically in a war with eachother over marketing and need to spend the maximum amount possible to get you to but their $3 toothpaste over another CPG's $3 one and over a lower-priced generic. If they could cut their marketing budget in half, they would, but that would only work short-term.
- arcturus17 5y ago
  Toothpaste costs $6-$8 in Amazon US? Holy cow.
  - lotsofpulp 5y ago
    No, it is ~$3 for a standard ~5oz size. https://www.amazon.com/Crest-Complete-Whitening-Toothpaste-Triple/dp/B005PLQIQ4 https://www.amazon.com/Crest-Complete-Whitening-Toothpaste-T... Amazon is more expensive than Costco/Walmart/Target, but especially so for dense, heavy items like liquids (or toothpaste).
jhbadger 5y ago
At least clothing manufacturers do skimp on quality for downmarket sales. It used to be that clothing at "outlet centers" were literal overstock items, but as they've become more popular, clothing makers now have cheaper, lower quality clothing made especially for sale in outlets.

4 ms·

This isn't correct. Big brands virtually never skimp on product quality for smaller stores because it harms the long term equity and value. They customize quant

by sfifs 5y ago

This isn't correct. Big brands virtually never skimp on product quality for smaller stores because it harms the long term equity and value. They customize quantity.

raverbashing 5y ago
These products are so well optimized now they're mostly margin and packaging/shipping/handling cost. I doubt your toothpaste tube cost more than $0.50 in actual materials to make. And on a store this can go for $3? $4? (from a quick look in Amzn - approx values the cheapest one is $8 for 6)
- sfifs 5y ago
  CPG industry margins are quite public as almost big brands are owned by listed companies. They're not high. The highest margin categories for big retailers i believe tend to be clothing.
  - Scoundreller 5y ago
    They're not wrong about the big difference between production cost and selling price. CPGs are basically in a war with eachother over marketing and need to spend the maximum amount possible to get you to but their $3 toothpaste over another CPG's $3 one and over a lower-priced generic. If they could cut their marketing budget in half, they would, but that would only work short-term.
- arcturus17 5y ago
  Toothpaste costs $6-$8 in Amazon US? Holy cow.
  - lotsofpulp 5y ago
    No, it is ~$3 for a standard ~5oz size. https://www.amazon.com/Crest-Complete-Whitening-Toothpaste-Triple/dp/B005PLQIQ4 https://www.amazon.com/Crest-Complete-Whitening-Toothpaste-T... Amazon is more expensive than Costco/Walmart/Target, but especially so for dense, heavy items like liquids (or toothpaste).
jhbadger 5y ago
At least clothing manufacturers do skimp on quality for downmarket sales. It used to be that clothing at "outlet centers" were literal overstock items, but as they've become more popular, clothing makers now have cheaper, lower quality clothing made especially for sale in outlets.