This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

10 Products With Big Markups

BOSTON ( MainStreet) -- While chatting with an acquaintance at the popular Italian restaurant he owns, our conversation was interrupted when he learned a customer had complained about a meal.

The waiter, feeling the diner was merely being finicky, resisted a request that the meal be removed from the bill. "Give it to them," the owner countered. "A plate of pasta costs me almost nothing. It is worth more in the long run to get good word of mouth than to worry about a few cents worth of spaghetti."

His point was that, all things considered, the meal itself wasn't the commodity -- the experience was. It is the latter that justified the significant markup on the meal.

When it comes to pricing, you typically pay what the seller thinks you are willing to pay. Aside from fixed costs -- raw materials, labor and overhead -- consumers are plunking down their money on perceived, not actual, value. For example: Gold, used for little more than jewelry, isn't really worth $1,600 because of scarcity or necessity. It is worth that much because buyers and sellers have negotiated that cost over time.

A huge decision for any company -- whether it sells food, electronics or clothing -- is pricing, but it is as much art as science. There is a hard number for what it takes to cover costs and scratch out a profit, of course. But great care is made to find the sweet spot for getting customers to pay as much as possible without driving them away.

Determining what a product "could" cost versus what it "can" cost isn't always a matter of gouging for profits. Companies need to factor in overhead, manufacturing and marketing when setting a price. People often complain about the high cost of prescription drugs, but then again the drugmakers have years of research -- as well as a limited time free of generic competition -- to account for.

The following are 10 products that have notable, if not the highest, markups.

1 of 11

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
KO $43.36 0.00%
PEP $100.50 -0.13%
SBUX $62.19 0.37%
S $3.76 -1.83%
TIF $80.77 1.83%


Chart of I:DJI
DOW 17,813.39 +1.20 0.01%
S&P 500 2,088.87 -0.27 -0.01%
NASDAQ 5,116.1430 +13.3350 0.26%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs