Paul Below wrote:

They consider all of "their" costs. Or at least the costs they incur
in the short term.

They likely don't consider any costs that don't get passed along to
them, which is what I think the poster was referring to. I could be
wrong, though.


The costs passed on to them become part of the prices they pay. Every
business -- or at least those that'll stay in business -- will pass on
their overhead costs to the next step. Then those costs are passed on to
the next step, and so on and so on.

So the cost of the peat used by the grower is passed on to the
distributor who passes them on to the retailer.

Or to get a little more detailed, the costs involved in harvesting and
shipping the peat is part of the costs the grower adds on before selling
to the distributor. Those costs get passed on to the retailer.

And if the retailer doesn't sell the plant, either their cost in lost
merchandise is passed on to the consumer in the form of higher overhead
used in determining prices for everything else in the store. Or if the
retailer gets a refund from the distributor, those costs are passed back
to the retailers when the distributor adds in additional costs in their
overhead, and ultimately this cost reaches the consumer again.

Sounds horrible that the consumer is ultimately paying for all this
waste, doesn't it? Until you consider that the costs involved in
handling the situation differently are higher. The pressure from the
consumer market to keep the final retail price low causes everyone at
every step in the process to look for ways to cut their costs. The lower
their costs are, the less they have to pass on to the next step to still
make a profit.

In the end, either the consumer pays for everything, including waste in
the production chain, or someone else along the way pays those costs in
business losses.

While each step in the chain doesn't necessarily know what the breakdown
of the costs of those before them in the chain are, they're still paying
those costs. So ultimately, they are considering all those costs.
There's no way they can't, and still have a profitable pricing model.

--
Warren H.

==========
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On Sat, 10 Apr 2004 17:01:07 GMT, Warren wrote:

In the end, either the consumer pays for everything, including waste in
the production chain, or someone else along the way pays those costs in
business losses.

You missed the point. I was talking about things like diesel soot pollution
spewed by trucks carrying these products that are thrown away. And stripped
peat bogs that may never recover. Fertilizer from these plants that runs off
and produces the Mississippi dead zone. We bear those costs, and they aren't
paid by the consumer or anyone along the way. They are left unpaid.

--
John GOTTS http://linuxsavvy.com/staff/jgotts