Overpaying — it’s every consumer’s greatest fear.
While a lot of us are keenly aware that the goods or services we pay for are typically marked up, it’s the percentage of the markup that can really gnaw at some people. For example, it’s fairly common knowledge that the restaurant business has notoriously high markups. But there are reasons for it. You’re not just paying for the food (yes, you can make it yourself at home for cheaper), but you’re paying for the atmosphere, service, and presentation. There’s a lot to consider.
Another example, which evidently bothers an awful lot of people, is the markup on our electronic devices. Apple sells Beats headphones for around $300. The cost to Apple to produce those headphones? A mere $18. So, what are you paying for? In the case of Beats, you’re paying for the brand name. A lot of people think that’s insane. Others gladly shell out the cash to get a pair.
Your girlfriend’s $500 purse functions exactly the same as a $20 purse, yet, you have to pretend that it’s somehow better. Same thing with clothing, or shoes.
Aside from food and brand-name electronics or accessories, there are thousands of other things that we pony up big money for, and likely don’t get anything near the kind of return we should. These are overpriced items, and a lot of them are things you may never give much thought to. Some of those overpriced items we’re more than okay with paying for, because even at a significant markup, the price seems more than reasonable.
So, what are some of those items that we’re paying through the nose for, without even realizing it? Luckily for you, we’ve put together a short-list. Read on to see seven of the most overpriced items you can buy.
1. Greeting Cards
Average Markup: 200%
While it’s true that you can find some cheap greeting cards out there, you’re more likely to find them ranging in price from a couple of bucks, to upwards of $10 in the aisles at Walgreens or Hallmark. And it’s a huge business — industry insiders speculate that Americans buy 6.5 billion greeting cards every year. That’s a lot of leeway for different price points, and why you see such a large markup on some cards.
Average Markup: 80-300%
We touched on restaurants previously, and coffee falls under that category. A visit to Starbucks or Dunkin’ Donuts provides some coffee drinks with steep prices, and the markups that many businesses put on coffee can range from 80-300%. But again, in a coffee shop, you’re paying for atmosphere — not just a cup of coffee. If you want to skip the markup, head to a local gas station, or 7-11.
3. Bottled Water
Average Markup: 4,000%
Remember that whole ‘$5 bottled water in the airport’ fiasco? Well, you shouldn’t be surprised — water is, after all, one of the most marked-up things you can buy. Some estimates put it at as much as 4,000%. If you want an easy way to save on water, just get it from a faucet. And don’t freak out about quality — even bottled water comes out of a faucet.
4. Printer Ink
Average Markup: varies
If you’ve never had to buy a replacement ink cartridge for your printer, consider yourself blessed. Sometimes, the ink costs more than the printer itself. Actually, you might be better off just doing all of your printing jobs at the nearest print shop. Or get a laser printer.
To put the price of ink into perspective, here’s MoneyCrasher’s take on it: “The true cost of a gallon of ink is $65,000, based on a price of $16.99 for the standard 3.5 mL regular cartridge size. That’s more expensive than champagne or gasoline.”
5. Movie Theater Concessions
Average Markup: up to 900%
Ever wonder why you’re paying $12 for a movie ticket, but $5 for Junior Mints? It’s because concession sales are how movie theaters make most of their revenue. By shutting out those who want to bring in outside food and drink, they can control the supply. That’s why you have $6 sodas, and $8 hot dogs.
The popcorn alone can be marked up 900%.
Average Markup: 18-100%
Diamonds are pretty much the biggest racket in existence — and it’s a matter of life and death. They can produce flawless diamonds in laboratories, meaning that there is virtually a limitless supply of them. No longer does the diamond cartel need to control things, using slavery and brutal capitalist tactics to control supply. Yet, things continue.
On the low end, you can get them for an 18% markup.
7. Razor Blades
Average Markup: 4,750%
The reason razor blades at the grocery store are often locked up is because they’re expensive. Very, very expensive. Though you can subscribe to very cheap services like Dollar Shave Club, buying razors at the store still has you shelling out way more than they’re worth. Buy a safety razor, get on Amazon, and look for alternatives. Otherwise you’re paying a massive markup.
Follow Sam on Twitter @SliceOfGinger