What is the profit margin on name brand diet soda such as Diet Pepsi,
Diet Coke, Diet Dr. Pepper, etc. as sold by a typical small grocery
store chain (i.e. 3-5 stores) in the U.S.? |
Request for Question Clarification by
ragingacademic-ga
on
22 Dec 2002 19:00 PST
willieg -
Thanks for your question.
Are you referring to fountain soda - or bottled soda?
It may be difficult to get the exact profit margin for a chain of the
specified size (e.g. 3-5 stores). What is the minimal amount/type of
information you would deem acceptable as a reply? For example, would
the profit margins of Circle-K work?
thanks,
ragingacademic
|
Clarification of Question by
willieg-ga
on
23 Dec 2002 10:10 PST
I am focused on 12 oz. cans of name brand diet soda. Large retailers
such as Albertson's, Kroger, and Circle K would not be usefull. I am
focused on small grocery chains -- Mom & Pop operations -- local
grocers -- small chains of 5 stores or less. Thanks, WillieG
|
Request for Question Clarification by
alienintelligence-ga
on
27 Dec 2002 22:34 PST
Hi willieg...
This information is almost impossible
to ascertain. The US is large, very
large. The cost of living across the
US varies enough that the profit margin
would be greatly different from one
area to another. I'm sure that there
are areas that are large enough that
a small grocery store can get a good
quantity discount that could easily
allow an 800% markup. As an example
I can frequently purchase 12oz cans
for $0.16 and sell QUICKLY for $0.65.
400% markup there. If you can get
the cans for $0.10 and sell for $0.80
that's your 800% markup. You could
expect this in LA, or Miami, downtown
NY, etc.
Smaller rural areas probably can't
get the cans for less than $0.20
and might not be able to sell for
more than $0.50. Barely 250%.
The markup will definitely depend
on the specific area and shrewdness
or the business owner. Anyone can
overprice an item, it doesn't mean
the market will support it. Would
you care to specify a market area?
thanks
-AI
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Clarification of Question by
willieg-ga
on
28 Dec 2002 07:08 PST
AI:
The area is the Florida Keys, a 120 mile string of islands extending
SW from Miami. All retail goods are trucked in. Currently soda sells
throughout the keys for $1.00 from a machine, $.65 per can in the
stores and $2.60 per six pack. There is a soda made in the NE (not
available south of PA) which is very tasty and has no cal., no sodium,
no caffine, and no Aspertime as it's made with Sweeta. I can buy FOB
at the plant for $.69 a Six Pack. To this I must add my cost of
transport from the NE and distribution in the keys. In order for me
to make a profit the small retailers here would make 30% to %40 if
they sell at competative prices to Diet Coke etc. So, I am trying to
determine what their typical profit margin on 12 oz. can six packs of
diet soda is so I can compete. The Coke is Pepsi route reps pull up
now and unload diet soda which the store then sells for $2.60 a six
pack. Somehow those route reps and their distributors and the coke
plant in Atlanta all making money. All this before the grocer marks
it up. So, a critical link for me is what the profit expectation of
the grocer is in order for him to want to carry my product.
Thanks
WilliG
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