If you are active on social media you might have come across the issue surrounding the US$700 flowers. These flowers are being sold under the Luxe Flora brand under VIP Hosting. VIP Hosting is run by Kevin (affectionately known as Kevin The Wedding Planner). He is arguably one of the, if not the most sought-after wedding planners in Zimbabwe. He runs it with Craig Zoowie an award-winning stylist and grooming consultant. Anyways the flowers in question range from US$200 to US$700, specially earmarked for Valentine’s Day. You can understand how they have given rise to widespread discussion on social media. That is not the subject matter here though; it just got me thinking about high margin or profit products that you can sell. In this article, I am looking at products or services that do not cost that much to make available but have very high margins or profits.
Well, I can understand how baby clothes are usually made out of premium soft material for baby skincare. However, in most cases, it does not justify the crazy mark-ups that are placed on them. This is especially so when you consider that the clothing items in question are usually small. It is usually borne out the high demand for baby clothes. Thus businesses can take advantage of that.
Of course, it is appreciable that as a country we import virtually all prescription drugs. Here I am also referring to drugs used in livestock production too. Be that as it may, it has been noted that insanely high mark-ups are placed on prescription drugs. One of the loopholes that are capitalized on is monopolies (leading to lack of competition) in the industry. The other aspect that makes it easy to get away with huge mark-ups is the ever-present high demand for prescription drugs. Thus people end up just buying the drugs despite there being exorbitant.
Pre-cut Fruits And Vegetables
This was is quite interesting because there are so many things people are not aware of. It is a fact though that buying pre-cut fruits or vegetables does bring convenience for the consumer. However, the price tags are usually far-removed from had the fruits or vegetables been bought whole. If you could reconcile how much money comes from one fruit after it has been cut up as opposed to being whole you would shock. Interestingly, food outlets at times do pre-cuts to salvage everything they would have ordered. For instance, damaged fruits or vegetables might not be sellable as a whole thus cutting them masks the whole damaged element. Regardless they still capitalize on that to charge ridiculous prices.
Alcohol Served At Drinking Joints
You would be amazed at the money such outlets make from alcohol they serve. Here I am looking things like tots, or buying a glass of something, mixed drinks, and so on. If you could do the calculations you would realize the resultant mark-ups per full bottle of say, a wine, or a spirit, and the like would be in the regions of 150 per cent to even close to 500 per cent. It is somewhat similar to the pre-cut fruits and vegetable approach where smaller units of the whole area used to make more than would be made on the whole once-off.
This area has been the subject of controversy for so many years. How exactly can you really ascertain that bottled water is actually purified water? Take, for instance, mineral water, how can you be sure that it really came from a spring somewhere? Studies over the years have revealed that roughly 65 per cent of bottled water out there was simply drawn from a tap. This means by buying bottled water you can actually be spending 2000 more than you would have had you simply used water from your tap at home. In Zimbabwe, there are dynamics about how tap water is usually dirty which causes people to buy bottled water. Still, we can never absolutely ascertain it actually did go through some purification process. Maybe that is why there are so many bottled water brands now due to the huge mark-ups.
Mostly products and services in this domain are characterised by high mark-ups. Things that ordinarily cost less suddenly cost more when it is for a wedding. For instance, things like venue hire, photoshoots, cakes, and so on typically cost way more when it comes to weddings. Usually, it is because service providers consider that they are giving the luxury of convenience. As much as that can be true, it still does not take away the fact that the mark-ups they place on their prices can be too high.
Designer clothing can be ridiculously expensive. It is not surprising to find mark-ups above 300 per cent. This can be the case despite there not being much difference between the material used for it and that used for other general types of clothing. Usually, it is as if you are buying a name rather than the product per se. A variation of this scenario can even be seen if you visit some of the popular clothing shops. You can find a piece of clothing costing a particular amount in Edgars only to find it for half or less of that price in some boutique somewhere. Even the boutiques also do this whereby clothing items from second-hand bales of clothes are refurbished to look new and charged for unreasonable prices.
Home furniture is another example worth mentioning as I wrap up. In Zimbabwe, you will realize that most home furniture players buy their stock from informal traders. The same piece of furniture you find in TV Sales and Home you can find it for significantly way less being sold by an informal trader. Ultimately ends up being a scenario of buying a brand name. These are some of the products that usually have high mark-ups but with a questionable background.