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Originally posted by LoneGunMan
Walmart does the same thing. It works like this:
The buyers of K-mart bought so many thousand of these bikes from the manufacturer. They sold enough of them to make the money back plus turn tidy profit. The bikes that are left over are pure profit. They need floor space for something else they got a deal on and its best to blow them out. They are not losing a dime but still making money selling them way less than what they bought them for because they already made profit plus on the others they sold.
All too easy.
Originally posted by burdman30ott6
This certainly provides some window into just how much of the price of items are related to the actual material/labor/shipping costs and how much is pure profit for the sellers. Really makes you wonder how any store can actually go underwater if they have an 80% item markup baseline with which to work with to entice buyers.