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South Carolina | I will preface this by saying I used to work for a retailer.
In our part of the world, the retailer has a price sheet with three numbers per product. 1 is Invoice or what they paid for it, the second is Low Net or what they will end up paying for it after the manufacturer rebates which they will recieve about the time it is time to order for the following year (9-12 months later) and the 3rd number is MSRP. On basic chemicals 90% of the time they are sold for a figure very close to low net, which means until the retailer receives their rebate (if they do because that is constantly held over their head), they have financed the manufacturer at their own loss. During the year a bulk of the chemicals sold are at a negative margin that is made positive at the end of the year. It is a really screwed up system and the rebate game makes it even worse every year. Fertilizer has better margins but a helluva lot more infrastructure costs.
At the end of the day it seems like we are all slaves to Big M and syngenta and the rest of the big boys. | |
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Retailer Mark-Up
