Saturday, May 07, 2011

The Cost of Goods Sold

I'm fascinated by boxes and packaging. Some of it can be quite elaborate and I suspect some engineering team is paid quite a sum of money to devise the packaging so that a piece of cardboard or plastic can be constructed in such a way to facilitate a rather complex arrangement of products inside them. It's mind-boggling to me sometimes. And the only purpose is to get a product -- usually an electronic gadget of some sort -- delivered to us efficiently. We unpack and toss the box. It served its purpose. Trust me, I have a lot of experience with boxes and packaging.

This morning I went to the garage to break down some boxes that were stacking up in our utility room. They were beer boxes used to bring home six packs that we have purchased the last few months. Nothing too elaborate or complex there: four flaps on the top and four flaps on the bottom.

I often think about the beers we like being so expensive. Yes, they are high-end beers brewed with loving care by people who love the craft. And frankly, after breaking down a few boxes and contemplating this, I'm amazed they, and everything else we consume, aren't more expensive. I wonder how much of the $9 for some six packs is actually to pay for the 72 ounces of beer?

The bottles can't be cheap. There are full color labels on each one, and bottle caps as well. Sometimes clever stuff is printed on the underside of the caps. Six beers go into a carrying container which is covered with full color graphics promoting the brew. Four of these carrying containers go into a box. Each of the boxes are covered in ink promoting the product, and the bottoms and tops of them are glued shut for shipment.

Some graphics designer had to be paid to come up with the artwork, and marketing concepts take time to develop. All that cardboard had to be shipped from somewhere, as did the bottles, caps, and labels, and the glue used to seal them. Workers are paid to make the brew, and box it up for shipment. Equipment used to bottle the beers can't be cheap and surely requires frequent maintenance. These facilities require cleaning, and their utility bills must be enormous.

Large 18-wheelers come and load up hundreds of cases of these beers and prepare to haul them thousands of miles across the land. Truck drivers need to be paid, trucks require maintenance, insurance, and lots and lots of expensive fuel.

Upon delivery, some store clerk is paid to unpack the boxes and place the six packs attractively on the store shelves, and many of them sit in refrigerated compartments. Those of us craving a nice hop-filled brew will go to the store, select our brew of choice, and pay a clerk who is earning several bucks an hour to take our money. They place the beers back into a shipping box and off we go to drink it. We throw away our bottle caps, and toss the bottles into a recycling bin so another large truck can come every Wednesday and pick them up.

After a few weeks of this, I start breaking down boxes again, and thinking about all that ink.

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