Many years ago I had a coworker who had once worked for a major supplier of fruit juice. At that time, a large can of juice sold for around $1.00. He said the metal can cost about $0.10. The juice in the can cost only $0.01. The remainder of the dollar price was labeling, marketing, transportation, retailer markup and a small profit.
I suspect that a $14 tub of shaving soap has a similar cost structure. The tub and carton likely cost more than the soap inside. Transportation costs make up a significant portion of the overall cost, especially since shaving soap are not ordered by the truckload. Unlike a can of juice that you consume in a few days, a tub of soap can last months. The profit on an individual tub of soap is probably no more than a few pennies.
If the artisan were to increase the cost of the 8 oz tub to the point they can make a reasonable profit, the overall cost might reach a level that some customers find too high, especially a potential customer trying the product for the first time. Thus, by reducing the price and reducing the container size, the artisan can make a profit without scaring off potential customers.
As an example, consider Martin de Candre soaps. The cost is about $70 for a 200 gram jar (about 7 oz) or $10 per ounce. People who have used these soaps say they smell and perform wonderfully. They claim a tin will last "forever". So the soaps may be a better value than they first seems. However, since I have never tried MDC, I won't risk $70 on a tin of soap I might not like any better than my usual soaps and creams. However, I might try a sampler.
I suspect that a $14 tub of shaving soap has a similar cost structure. The tub and carton likely cost more than the soap inside. Transportation costs make up a significant portion of the overall cost, especially since shaving soap are not ordered by the truckload. Unlike a can of juice that you consume in a few days, a tub of soap can last months. The profit on an individual tub of soap is probably no more than a few pennies.
If the artisan were to increase the cost of the 8 oz tub to the point they can make a reasonable profit, the overall cost might reach a level that some customers find too high, especially a potential customer trying the product for the first time. Thus, by reducing the price and reducing the container size, the artisan can make a profit without scaring off potential customers.
As an example, consider Martin de Candre soaps. The cost is about $70 for a 200 gram jar (about 7 oz) or $10 per ounce. People who have used these soaps say they smell and perform wonderfully. They claim a tin will last "forever". So the soaps may be a better value than they first seems. However, since I have never tried MDC, I won't risk $70 on a tin of soap I might not like any better than my usual soaps and creams. However, I might try a sampler.
