[The Mystery of Snacks at Overseas Supermarkets] Free Thinking ⑥ Digging into and solving the mystery of why the price is about double for the same manufacturer & snack name 🍫 [Part 2: The Fact of Unit Price Reversal] & Satisfying Intellectual Curiosity!
<Recap of the previous post> 98% of the price mystery is solved by the 'net weight'!
In the previous article, I approached the 'mystery of the price being about double' for Lotte Almond Chocolate found at the Thai supermarket 'Big C'.
The conclusion was simply that the 'net weight was about double'.
Here are the results of comparing the unit prices after adjusting for net weight.
【Left: Japan Specification】 【Right: Overseas Specification】
Unit Price (per 1g)
Approx. 1.02 Baht/g Approx. 1.04 Baht/g
Surprisingly, a reversal occurred where the Japanese product on the left, which is an imported product, was slightly cheaper!
However, this result created a new mystery.
'Why is the overseas specification, which should be sold locally, slightly more expensive?'
This time, I will thoroughly dig into the economic mechanisms and manufacturer strategies hidden in this 'mere 1.9% unit price difference'!
⑤ The fact of unit price reversal! Where does the 1.9% difference come from?
[1] Japan's manufacturing efficiency is overwhelming! 🏭
・The victory of Japanese mass production
Japanese factories have extremely high manufacturing efficiency (economies of scale), so the cost of the product itself is very low.
It is speculated that this low cost absorbed the import costs (transportation fees, tariffs, etc.) that should have been incurred, resulting in a unit price lower than that of the overseas specification.
<Vocabulary check to deepen understanding>
⚠ You might know the vocabulary, but remember the meanings vaguely
Manufacturing efficiency → The ratio indicating how much production volume or results were obtained relative to the time or cost invested
Cost → The total expenses incurred until a product or service is provided to the customer.
In terms of types of expenses, it is composed of three elements: 'material costs (raw materials)', 'labor costs (personnel expenses)', and 'manufacturing expenses (cooking utensils, etc.)'.
Tariff → Tax applied to products imported from overseas into the country
Unit price → Price per unit (such as per gram or per piece)
Import costs → Includes not only tariffs and product costs, but also a large amount of transportation fees, insurance premiums, and consumption taxes. In other words, Tariffs ⊂ Import costs
[2] Differences in local 'profit strategies' 📈
・Pricing of overseas products
Local subsidiaries or authorized distributors may be setting unit prices strategically to ensure stable profits, including advertising expenses and distribution margins.
・Pricing of Japanese products
Importers may be keeping profit margins low to enter the market as 'quality Japanese goods'.
〈Vocabulary check for deeper understanding〉
⚠ Even if you know the vocabulary, you might remember the meanings vaguely
Local subsidiary → A separate company (subsidiary) established by a Japanese company overseas based on local laws
Authorized distributor → A company or store that has signed an official sales contract with a manufacturer or brand to sell authentic products on their behalf
Advertising expenses → Costs for informing an unspecified number of people about products or services to get them to purchase
Distribution margin → The difference between the selling price and the purchase price
Market entry → When a company introduces products or services into a new field or market for the first time to start a business
By the way, to succeed, it is important to research the market in advance and develop a strategy (market entry strategy) on what to provide to which customers and how.