So, I'm at Target tonight

[MattyMatt]

They said you're dating MattyMatt? You definitely know about shrinkage

Ya hired

She had this job long before she met me. Whew! Talk about being saved...

Or, maybe I really am responsible for that huge ass promotion she's about to get!

 

[Enfuego]

Yeah grocery stores only make about $1 in profit per $100 sold, it's a very low margin/high vol business obviously.

What you said about 55% starting in teens makes sense. When I meant most of it is younger people, I moreso meant starting out that way and not people starting to shoplift in their 30s and 40s.

Where do you get that number? I don't buy it.

 

[MattyMatt]

Where do you get that number? I don't buy it.

It's hard to say. It's categorized...

HBC (Health and Beauty) is normally the highest, Dairy is normally the lowest. Typical high is 30-50%, and low being 1-3%. This is on select items in categories, not overall profit. It typically ranges down to lower than the average of about 15%, or around 7-10%.

 

[Enfuego]

It's hard to say. It's categorized...

HBC (Health and Beauty) is normally the highest, Dairy is normally the lowest. Typical high is 30-50%, and low being 1-3%. This is on select items in categories, not overall profit. It typically ranges down to lower than the average of about 15%, or around 7-10%.

It seems like a tough business for sure.

 

[PatsFan1283]

There you go EF

http://smallbusiness.chron.com/profit-margin-supermarket-22467.html

 

[Enfuego]

There you go EF

http://smallbusiness.chron.com/profit-margin-supermarket-22467.html

That's an interesting article. Would like to know the profit margins according to an expert in the field instead of a reporter with NPR. That's a low margin though.

 

[MattyMatt]

There you go EF

http://smallbusiness.chron.com/profit-margin-supermarket-22467.html

Pretty spot on for the most part. My gf even mentioned the 70% on some that I didn't type in earlier, but it is rare.

 

[MattyMatt]

That's an interesting article. Would like to know the profit margins according to an expert in the field instead of a reporter with NPR. That's a low margin though.

The numbers I gave you are from an expert in the field. I could give you exact number, or more specifics, but she told me I can't. L

 

[MattyMatt]

You have to factor in bill backs from suppliers as well to get an overall profit margin on each item.

 

[Enfuego]

The numbers I gave you are from an expert in the field. I could give you exact number, or more specifics, but she told me I can't. L

I imagine it's also difficult for new companies to get their product on the shelf as well huh?

 

[MattyMatt]

I imagine it's also difficult for new companies to get their product on the shelf as well huh?

In her stores, it can be, but not so much if they offer incentives and bill backs. They also have reduced or done away with slotting fees, and try to have what the customer wants more than what makes the most profit or looks good like wal-Mart. But, of course, the main goal is to make a profit and getting you to want to shop there. At Wal-Mart, they rent shelf space. That's why you always see the name brands that everyone knows at eye level and top shelf.

 

[PatsFan1283]

That's an interesting article. Would like to know the profit margins according to an expert in the field instead of a reporter with NPR. That's a low margin though.

That was just the first thing that cameup on Google so was good for a quick link but most of the publicly traded supermarkets like a Kroger or Albertsons have 1-3% overall margins.

Reason that even though people spend like 10% of their $ on food, there is no grocery store that is among the biggest companies.

Kroger made 2 billion last year. Apple made 70.

 

[TomGshotput]

I don't know JC, the consumer ends up paying for that kind of loss with higher prices typically.

I have a hard time accepting this. If there was no shoplifting, wouldn't Target set prices their that maximizes profits. Which means any change in price would reduce profit. Just because shoplifting enters the equation it doesn't change the price-point that is best for the seller

 

[Shub]

Why would you even say anything? That's not your job.

 

[festeringZit]

You also have to remember they take a loss of certain items just to get you in the store. Sometimes a huge loss. I can also assure you nothing is the grocery store is marked up 200%. Some don't even make it to 3%.

"nothing in the grocery store is marked up 200%"

Not true at all. I worked in the grocery business for many years, to put myself through college. It's common knowledge that both bottled water and greeting cards
are marked up well over 200%.

 

[RenoChazz]

"nothing in the grocery store is marked up 200%"

Not true at all. I worked in the grocery business for many years, to put myself through college. It's common knowledge that both bottled water and greeting cards
are marked up well over 200%.

I did too, some stuff is marked up that high, but the over all margin is 1%. Magazines are way marked up. The grocery business is very cut throat. Lots of things are sold at cost to get you in the door. And checkers are supposed to check the bottom of the basket. Not doing so and getting caught is an automatic write up, and could result in termination. Corporate at the store I worked at, actually sent people in to do it on purpose. Two strikes an you're out.

 

[jett]

You get a bonus if you had your kids with you, they notice things like that. Mistake or not, you brought it up and that's all you could do. Turn a negative into a possible teaching lesson for younger, more impressionable people.

 

[MattyMatt]

"nothing in the grocery store is marked up 200%"

Not true at all. I worked in the grocery business for many years, to put myself through college. It's common knowledge that both bottled water and greeting cards
are marked up well over 200%.

Those are sold by outside vendors with only a cut coming to the store. Same with Coke, Pepsi, Bread. Shelves stocked by those vendors. Same with papers and magazines. The highest I've even seen is 70%, and nothing really exceeds the 30-50%.

Yes, grocery is definitely a cut throat business, though....

You guys need to keep in mind I'm normally talking overall profit on single items. You have to factor in shrink, kickbacks, incentives, and bill backs as well (if you know what those are)...

 

[RenoChazz]

Those are sold by outside vendors with only a cut coming to the store. Same with Coke, Pepsi, Bread. Shelves stocked by those vendors. Same with papers and magazines. The highest I've even seen is 70%, and nothing really exceeds the 30-50%.

Yes, grocery is definitely a cut throat business, though....

You guys need to keep in mind I'm normally talking overall profit on single items. You have to factor in shrink, kickbacks, incentives, and bill backs as well (if you know what those are)...

Yep and lots of shrink isn't even from theft. Every thing has a shelf life. Lots of shrink in Dairy and produce.

 

[MattyMatt]

Yep and lots of shrink isn't even from theft. Every thing has a shelf life. Lots of shrink in Dairy and produce.

Yea produce has a pretty big markup, and dairy has the lowest profit margin.