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689 points taubek | 1 comments | | HN request time: 0.217s | source
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greatgib ◴[] No.43632088[source]
All around the "developed world", the shop/retailer/supermarket/distribution part of the price of a product is around 50%. Whatever the product or its price.

I'm wondering if part of our issue with crazy inflated prices despite low margin for industry and manufacturing actors is not because of this abused margin for retailers. That have also a huge power as it is difficult to negotiate when you depend on your product to be buyable in the market.

To me, that explain a big difference with asian world, where you notice, even for asian shops in western countries that prices are still quite cheap.

Something parallel to that that I have noticed is that decades ago we were used to buy from small individual shops, but now a few retailers and chains have almost a monopoly on the market.

I see the same pattern for movie theaters. They used to be independent mostly with affordable prices. Now 2 or 3 big chains bought them all, and it is very rare to still encounter independent movie theater. And once they got a good monopoly, ticket prices skyrocketed to insane levels.

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1. toast0 ◴[] No.43633065[source]
If you look at the retailer margin on an individual product, it looks pretty big. But if you look at their overall financial report, their overall margins aren't anywhere close to that.

There's a lot of cost to running a retailer. If it was so easy to avoid the costs and the margins, you'd see more brands going direct to consumer exclusively, but most brands do a little direct to consumer and most of their sales through retailers.

Movie theater economics basically suck and have gotten worse over time. The projectors are very expensive, the pricing to show a film is bad, so ticket and consession prices go up and people stop showing up. Big chains have more negotiating power for film terms and equipment, which can help them survive. Sometimes the independents band together for group purchases, but I think that doesn't always happen.