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Last login: Thursday, November 5, 2009
I have been involved at every level of marketing and sales for over 55 years and yet I am baffled by the math in the above article regarding San Diego area produced Oranges.My understanding is that the Grower receives about 19% of the retail sales price for their San Diego Oranges, when they are sold in Foreign Markets.
The Foreign Market retail price has to be 5 times higher than what the Grower is paid. One of the mark-up costs, obviously has to be freight. The other burdens can either better or worse than in this domestic market.
Am I to conclude, that the demand (retail) price in the San Diego is such, that the Grower makes more money with a 19% Gross from Foreign Markets, than 100% Gross in the Domestic Market.
This would mean that if the Foreign Market retail price is $1.00 per Orange, the American (San Diego) Grower is receiving $.19 cents, and anything above that revenue would result in the Growner being over-priced, and non-competitive with the Imported Oranges from abroad, being able to be sold at a lower retail price in the Domestic (San Diego) Market.
I can't believe that the Retail Price for a San Diego Orange is 5 times higher when sold in a foreign market.
Why don't the Foreign Growers of Oranges, in the Countries mentioned as Foreign Competition, sell in the same markets overseas that the San Diego Growers compete in?
I also didn't think that manual labor (and the appropriate labor costs) was such a factor in the production,processing,and growing of Oranges.
I have no idea what the Labor Costs per ton of Oranges amounts to, and how that affects the cost of a single Orange, or a pound of Oranges, or however they are sold in a particular market.
It has been my experience, that Growers or Farmers, all seem to price all of their products at a higher price than they are being retailed for in Grocery Stores.
I would appreciate a more intelligent and informative article on this subject.
David A. Thorpe
November 5, 2009 at 7:04 p.m.
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