We all understand that a retailer has to make a profit. It is the very basis of the capitalist system.
With that in mind, there are certain products that carry a markup that will make you gasp. Here are ten products that are marked up so much that you will probably get a little angry.
- Popcorn at the movies usually carries a 1,275 percent markup. The candy is usually marked up at least 200 percent.
- Prescription drugs have been marked up so much that, in the US, the Arizona Attorney General is suing one distributor. With markups that are as high as 3,000 percent it is easy to see why. This is less of an issue in Canada, where drug pricing regulation means brand-name medications are typically cheaper than they are south of the border. However, prescription drug prices are always a concern.
- Diamonds may be a girls best friend, but they are marked up by as much as 400 percent over the wholesale price. That figure triples if you figure the actual cost of mining them.
- Bottled water is marked up by 4,000 percent in some cases. Some companies simply bottle the tap water from another city, so why waste the money?
- Eyeglass frames are marked up an average of 1,000 percent. You can shop online at optical sites and save plenty of cash.
- Alcoholic beverages in a restaurant or bar are usually marked up by at least 400 percent. How often have you paid $5 for a single beer at the local grocery?
- Do you enjoy going to your local coffee shop for a beverage? Every drink in that little store is marked up by at least 300 percent.
- Designer jeans are a trap for anyone. For example, Super T Jeans, made by True Religion, cost less than $50 to make and ship, but the average retail price for those jeans hits $335. It is easy to imagine plenty of better ways to spend that money.
- Cosmetics are a ”necessity” for many people. These products actually have the lowest markup on this list. At a mere 78 percent, cosmetics look like a comparative bargain. However, as Mr. Wonderful said this past Friday on Shark Tank, cosmetics is a super-saturated industry, because only drug-dealers have higher profit margins!
- The textbooks that you desperately need for college are usually marked up by a few thousand percent. Unfortunately, many new students do not take advantage of rental opportunities or shop used bookstores that are off campus. With an average bill of $665 a year for new textbooks, it behooves you to look for a better deal.
The moral of the this little story is that you could be wasting a fortune by not buying generics or finding other alternatives. Ask yourself a few questions before you buy anything: Do I need this or just want it, is there a generic version, or can I make this at home? All of these questions could lead to more money in your savings account.