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Different Prices Everywhere

 
 
Reply Sat 25 Jul, 2015 07:18 am
I've noticed that Marlboro cigarettes sell for different prices according to state, city, country, etc. Does the profit that Marlboro earn per pack differ from each state, city, and country, too? If so, how exactly does that work?
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jespah
 
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Reply Sat 25 Jul, 2015 11:45 am
@elsie01px2019,
Local taxes (if any) differ, depending on where you go. You're likely noticing this with cigarettes but this is also the case with booze, gasoline, and other taxed commodities.

Local price differentials also reflect area demand, what the market will bear (e. g. is it a wealthy or a poor area, where a small discount could potentially drive sales up, thereby readily paying for itself), and retailer markup, as do the prices of everything else that you have ever bought.

As for Marlboro itself, the company seems to really make a killing (heh) overseas, where taxes are lower and regulations tend to be considerably looser, plus the smoking rates are often higher (go to Europe or Asia, and you'll see people smoke like you don't see in a lot of America anymore, particularly in the Northeast). But in the United States, Marlboro as a wholesaler probably isn't garnering too much of a significant difference in profits from state to state or municipality to municipality. Cigarettes might cost more in, say, Alaska, but the shipping costs offset a chunk of that.

If you want to learn the specifics of Marlboro's profits, I suggest you Google smoking lawsuits. People do sue cigarette manufacturers when they get cancer, and sometimes profits are made a matter of public record. Philip Morris is publicly traded so you can also get profit information by checking their trade records. Buy a share of their stock and you'll be privy to that information as a partial owner of the company.
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