Thus spaketh Tony Bryer:
On Mon, 15 Jan 2007 12:24:34 -0000 Gaz wrote :
I find stores like poundland excellent, because you really get the
sense of how much margins some companies and their channels are used
to.

It is sometimes hard to accept, because we have being conditioned to
think of price=value. But the price of goods, is largely not
connected to the cost of production, but how much the consumer is
willing to spend.

Too right. Go to Tesco and see what they are charging for a bottle of
white label cola. 15p? Forget the contents: that price is made up of
profit, bottle, filling and labelling, transport and handling. Except
for the profit, these costs are the same for a bottle of the real
thing, 89p?, whose contents can only cost pence at most. Which leaves
a very nice additional margin to be shared between Coca-Cola and the
retailer.

Less than 2 pence for the bottle, the cap, the label and the contents.