Do you think Buy one Get one earns you 100% profit?

First of all, there is no such product that gives you 100% profit as 100% profit is the uppermost limit which is impossible to achieve in reality. Every product comes with a cost and if there is a cost, it will eat out your profit.


Cost eats your profit and hence profit can't be 100%.


We are hardwired to include only Purchase Cost as 'Cost'. But in reality, it is just a slice of the huge pie.


Some of the invisible costs include

  • Inventory Cost/Holding Cost

  • Paid Cost vs Unpaid Cost(Credit)

  • Labor Cost

  • Utilities Cost(EB,Rent etc)

  • Marketing Cost

  • Logistic Cost

  • Taxes etc


Let us prove by comparing Pure Product Offer(1+1) and Hybrid of Cash(25%) and Product Offer(30%)


Let us buy Product A in these two Schemas

Pure Product Offer = No Cash Offer

Hybrid = Cash + Product offer(Best of both worlds)





Note:

In Pure Product Offer, when you buy 10 Qty you actually buy 20 Qty(1+1)

In Hybrid When you buy 10 Qty you actually buy 13 Qty(30% Product Offer) and 25% of cash in Hand at the disposal


Take a note of Profit per Qty(Last Column) - It is hardly a difference of 0.5 rupees.


This is just proof to show that 1+1 is just differed by a meagre amount in profit.

In this proof, I just considered Buying and Selling and tried to simplify the case as bottom as possible.


Next Post I will exactly prove HYBRID >> PURE PRODUCT OFFER. Stay tuned !!

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Disclaimer: This article is me speaking to me through this blog! Short Intro: If you want to innovate in a particular field, you need to understand how things work in the first place. Innovation is a