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price structure ?

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  • price structure ?

    What is the price structure for a beverage that will retail for $1.99

    I have been told the classic model is;

    Retail to consumer- $1.99 per bottle = $47.76 per case.
    Retailer will want about 50% mark-up or to purchase from Distributor for $32.00 per case.

    Distributor will want to purchase from bottler for $28.80 a case.

    How does this match up with real word numbers ?
    Also what happens when a master distributor step is added to the equation ?
    marshall thompson

  • #2
    Ooops, intended to say real world numbers.

    and that the $28.80 price to distributor includes shipping.
    marshall thompson


    • #3
      Retailers want minimum 30%, some even get 40%. Don't know any distributor that would work off the 10% you use as an example. dist needs to be 25% minimum plus free pos and samples.


      • #4
        Dist will pay anywhere from $22 to $24 a case plus free POS and samples a turn around and sell it for $32.


        • #5
          Thank you for your responses.
          A previous company I was associated with did have distributors that bought a beverage intended to retial for $1.99, at a price of $28.80 per case and then resold them for $32.
          I knew there side arrangements to allow such a margin but I was unaware of the terms of the agreement.

          I am now getting ready to strike out on my own and what it boils down to is if if the beverage is intended to retail for $1.99 each, what should the cost to the distributors be to allow for a good margin at each step.

          Right now I get the idea it should be about $25.
          Am I wrong ?
          marshall thompson