Why are plastic drinks bottle so expensive??
- Thread starter F70100
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nickyboy
Norven Mankey
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- You want hills? We got hills
The pure production cost of the bottles is extremely low, a few pence. The costs you have to bear in mind are the tooling and the distribution. Tooling costs are fixed regardless of volume so if you make gazillions of the same shape, it is insignificant. But if you only make maybe 100,000, the tooling costs per bottle can be as high as the production costs.
Bottles are largely fresh air so distribution is always relatively expensive (that's why they are made in UK, not China). Your retailer mark up is the biggest cost however. No idea what poundland will be working on but a mainstream retailer will be looking at 40% of the selling price (ex VAT) as margin. So your £2 bottle is £1.60 ex VAT, of which the retailer probably keeps 70p, leaving 90p for tooling, manufacture and distribution.
Bottles are largely fresh air so distribution is always relatively expensive (that's why they are made in UK, not China). Your retailer mark up is the biggest cost however. No idea what poundland will be working on but a mainstream retailer will be looking at 40% of the selling price (ex VAT) as margin. So your £2 bottle is £1.60 ex VAT, of which the retailer probably keeps 70p, leaving 90p for tooling, manufacture and distribution.
