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Old January 15th, 2009, 11:15 AM
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Hookah Guru
Join Date: Mar 2008
Location: Texas
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Default Re: Why so expensive?

Originally Posted by ************* View Post
tobacco taxes which are different from local state sales taxes are being figured in, for example, tobacco tax in CA is 45% and in TX 40%, those are figured into your final price, for example, if AF is being sold to a distributor at approx $4 per 250g, the distributor will have to charge the wholesaler 45% on top making it 5.80 to break even, then that wholesaler needs to mark it up to make a profit, what would a fair markup be (you decide $1 maybe) $6.80 to the retailer who needs to mark it up. retailers like to double their money at least, it should cost $13+, that's fair right? but then you factor in competition so the price is less than that. None of this has to do with sales tax which in CA is another 7.75%. hope that makes sense.
Very nicely done John.
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