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I think we can safely assume that the discount is tiered - so that if you buy the $4000 of DC product, you get 55% discount only on the last $500 worth; this is how supplier-incentives work in my experience (and since we're on teh internets, my mere anecdotal evidence translates into immutable and objective fact, natch).
Otherwise, you can imagine a situation where one is buying $3499 of product; if one spends an extra dollar, one gets 55% off the whole order, thereby reducing the cost of the order to $1925 - which makes no sense whatsoever.
(I would further imagaine that if one were to buy $3000-$3500 worth, they might get, say, 35% off the $500 dollars between $3000-$3500, and so on and so forth)
So, the only benefit of buying more than Brightraven's $5k-$6k would be the discount that you get on the extra volume.
So, a sensible retailer would be best served by buying proportionally more DC product, and then promoting the buggery out of it, pocketing more discount per issue sold than if he had sold an equivalent amount of Marvel.
So:
Hypothetically, assume that there is no disount below $3500. Further, assume that cost per unit is $2.
So, your retailer purchases $4k worth - $3500 at $2 (1750 comics), and $500 at $1.10 (455). They sell ALL 2205 of these at $3 dollars, making $6614, a profit of $2614, and reducing the average cost per comic to $1.81. In effect, the extra $500 worth has reduced the cost by 19c per unit. The profit per comic is $1.19.
Now, let's assume that Marvel requires an order of $5500, and then one gets the 55% discount.
So, your retailer orders $6000. For this, he gets 2750 comics at $2, and 455 at $1.10. He sells all 3205 of them, making $9613, a profit of $3614. His average cost per comic, however, is $1.87, 6c more than the DC example, and he still needs to sell 1000 more units than in the DC example.
Now - imagine he had spent his $6000 on the DC product instead; he'd have made $6068 profit, having reduced the average cost to $1.49.
I've generalised and simplified horribly, but it works, I think for the sake of example. |
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