Originally posted by Michelle B:
Ah yes, so in that regard. Don't sell giftwrap at all. Instead, go with a company that sells cookie dough for a 50% profit. Even if they have a cheaper cost and less quality ingredients- they're cookies and they'll pretty much taste just the same.
MichelleB -- you're missing the point. Cookie dough (though I think it's an excellent FR product choice) is no magic elixir on the percentage issue. No matter what you sell, the same factors apply.
Let's say you're getting $4 selling an $8 tub of cookie dough (50%). You could get $6 (60%) if you sold that same tub for $10. By your analysis that would definitely be smarter/better. But what the FR old-pros know is that that extra $2 will seriously affect total sales volume and could well result in less total profit for your group.
Using 50% as such a hard-and-fast rule is such a random thing. At the end of the day you want as much
net profit as possible (gross doesn't matter) for as little work as possible (service and high-demand product), while keeping your supporters happy (quality of product and pricepoint).
I'll stop beating on this, but -- for traditional sales fundraisers -- this is a pretty black-and-white issue. Having folks focus on the percentage issue is a sure-fire way to make sure the lesser-quality FR companies win. There is no (none) connection between higher profit percentage and "these guys must be a generous FR company".
Tim