Originally Posted by
pinworm
Not a bad idea.
And I would like to see a law in which retailers are required to show you their markups. Currently many retailers have taken to putting "Compare At" or "MSRP" on their price tags along with THEIR price. This number is ARBITRARY and means nothing, it only serves to make their sticker price seem low by comparison. It's a merchandising trick.
So, I would like to see their actual cost in place of the "Compare At" or MSRP. How would this help? It would allow consumers to make a more informed choice about the retailer they choose to give their biz too. If company A bought it for 1.00 and sells it for 3 dollars, vs company B who has the same thing and they bought it for 1 dollar and are selling it for 4, I can see who inflates the margin and passes more expense along to the consumer, and who is more competitive.
I also get to see how reasonable a markup is. 20% is one thing, 3000% is quite another. I would like to take my biz away from any company with the cajones to try and charge 3000%.
I think that goes too far. If company A is more successful than company B at both (a) managing their internal operations to increase margin and (b) adding superior value in their own portion of the supply chain, contributing more to the end-user's overall value of the product, why shouldn't they be rewarded for that?
The example you give probably isn't the best one: if a commodity is selling for $3 in one place and $4 in another, who cares what each company's COGS is...you're buying the $3 product. I think the realistic example is where both companies are selling the (commodity) product for $3 but company A has a COGS of $0.98 and company B has a COGS of $1.00.
For these kinds of products - especially now in the Internet age where we generally know what a particular little gadget
should cost - all of the competition is farther up the supply chain and in the internal operations. I don't think firms should have to reveal their own "secret sauce" there.
For the kinds of specialty products and services where you might see truly huge markups and high services/labor costs, there usually is no side-by-side comparison to do. You're buying or not buying based on how you value the end product, period.