On Wed, 19 Sep 2007 14:05:59 -0400, JimR wrote:

"Ignoramus29233" wrote in message
news
On Wed, 19 Sep 2007 10:00:26 -0400, Kurt Ullman
wrote:
In article ,
Ignoramus29233 wrote:

On Tue, 18 Sep 2007 21:47:03 -0700, Too_Many_Tools

wrote:
Why can't the company making $50 shovels make $5 shovels too?

Typically, the reason for doing so is maintaining a "premium brand
identity", which makes perfect sense.
Many do. For instance, many of the store brand products you see in
target or even WalMart are made by the same guys and gals who make the
"brand name" thing you see right next to it.

I also tend to think that if Walmart has products of Company X on its
shelves, then their stuff is probably not worth buying, even not from
Walmart.

You've missed the point completely.

I did not miss the point, I simply did not reply to it and mentioned
something else.

If two items come from the same production line, and one has a
national brand name label and the second has a store-name label --
e.g., the first is "Truetemper" and the second is "Target" or
"Walmart" -- the cost to produce the store brand is always less,
EVEN IF THE ITEMS ARE IDENTICAL IN CONSTRUCTION -- because there is
little or no marketing cost compared to the branded item. Another
example -- Gibson refrigerators cost less than their identical
Whirlpool clone. Marketing and overhead costs for store brands are
almost invariably lower, yet the merchandise may be from the same
production line.

That's a big reason store brands can be sold at a lower price -- they have a
lower cost for the identical product because they're not burdened with the
advertising costs of the national brand.

This looks at it backwards. The "cost of marketing" is the expense of
the company and how you allocate it (to all items, to corporate
overhead, etc), is arbitrary.

Due to advertising, the company can charge more for branded product,
and thus it is normally the case.

i