Strategy 17 common products that cost way more than they should

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Many common products have very high mark-up prices, often because they hold a high symbolic value, require specialized skills to produce, or there's little generic competition.

In 2016, Mylan Pharmaceuticals raised the list price of a two-pack of EpiPens to $600, due largely to the fact that there's little generic competition. play

In 2016, Mylan Pharmaceuticals raised the list price of a two-pack of EpiPens to $600, due largely to the fact that there's little generic competition.

(Bob Bird/AP)

Consumers often pay much more for products than what it costs to make them.

The reasons for steep mark-up prices depend on the product. It could be that the item is in high demand, is difficult to make, or holds a great amount of symbolic value.

Here are 17 popular products with incredibly high mark-up prices.

Note: For this story, we looked at various popular US brands, but price mark-ups are often similar for competing brands.

Popcorn at movie theaters

Popcorn at movie theaters play

Popcorn at movie theaters

(Getty Images/Scott Olson)

Wholesale price for a small popcorn: About $0.35

Price you pay at Regal Cinemas and AMC Theaters: $6.50

Movie theater chains, like AMC and Regal, charge a lot for popcorn (and other snacks), but according to a 2009 Stanford study, the mark-ups allow them to sell movie tickets at a much lower price.



Smartphones

Smartphones play

Smartphones

(Thomson Reuters)

Cost to make an iPhone X: $370.25

Price you pay: $999

As CNBC notes, the decreasing cost of many iPhone components and smartphone market dominance helps Apple's profitability from iPhones.



Text messages

Text messages play

Text messages

(Getty Images/Sean Gallup)

Cost for most phone carriers to send one text: Three-tenths of a cent

Price you pay per text via Verizon and AT&T: $0.20 on average (without an unlimited plan)

By making pay-as-you-go plans expensive, carriers like Verizon and AT&T can herd customers into longterm, multi-year plans, according to The Chicago Tribune.



Greeting cards

Greeting cards play

Greeting cards

(YouTube/Hallmark)

Cost to make a standard birthday card: About $1 to $2

Price you pay for a Hallmark card: About $3 to $7

High-grade paper (to distinguish greeting cards from something you could print from a home computer) and labor costs from making Hallmark cards in the USA lead to price hikes. As The Atlantic notes, consumers are also least sensitive to products' prices when they're trying to convey a sentimental message (like you do with greeting cards).



Designer jeans

Designer jeans play

Designer jeans

(Facebook/True Religion)

Cost to make a pair of True Religion Super T Jeans: $50

Price you pay: More than $300

True Religion's jeans are made in the USA, where manufacturing costs are much higher compared to overseas. The price mark-up also covers designer brands' big marketing budgets, and the costs of running stores, headquarters, shipping, and other overhead, according to The Wall Street Journal.



Graphing calculators

Graphing calculators play

Graphing calculators

(Wikipedia)

Cost to make a TI-83 calculator: $15 to $20

Price you pay: Around $100

Texas Instruments, the manufacturer of the TI-83 calculator, has retained a monopoly in the field of American mathematics, allowing it to charge a lot for its products. Textbooks, like ones made by Pearson, often feature illustrations and exercises that pair with TI-83s, so students must buy them.



College textbooks

College textbooks play

College textbooks

(Christian Columbres)

Cost to print "Introductory Algebra, 4th Edition:" $10.75

Price you pay: $100

The giant mark-up for college textbooks largely comes from author royalties, editorial production, marketing, transportation, and the cost to pay employees at bookstores. According to The College Board, the average student spends upwards of $1,200 per year on textbooks.



Wedding dresses

Kim's dress was custom-made, of course, so it likely cost a lot more than $8,000. play

Kim's dress was custom-made, of course, so it likely cost a lot more than $8,000.

(instagram.com/kimkardashian)

Price for 25 yards of silk satin to make a Badgley Mischka wedding dress: $2,500

Price you pay: Upwards of $7,000

With wedding dresses, brides are not just paying for the fabric. They are paying for the stitch, the fit, but most of all the emotion tied to the wedding dress itself.

"A bride's dress can signal how wealthy she is, what her status in society is," NPR's Caitlin Kenney wrote. "But it can also signal how seriously she's taking this marriage."



Diamond rings

Diamond rings play

Diamond rings

(AP Images)

Average wholesale price for a one-carat diamond: Around $1,000 to $3,000 (depending on the cut and style)

Price you pay at Kay Jewelers and Jared: $4,000 and up

On average, stores like Kay and Jared will institute a 100% to 200% price mark-up on diamond jewelry. The demand for diamonds in the US is largely a marketing invention.



HDMI cables

HDMI cables play

HDMI cables

(Amazon)

Wholesale price for a six-foot cable: $3.39

Price you pay at Best Buy: $5.99

Electronics stores often don’t make much profit off TVs and video game consoles. So to balance out the big items, most retailers mark up smaller items that many people use, like HDMI cables (which allow you to stream content from your laptop to a TV).



Printer cartridges

Printer cartridges play

Printer cartridges

(frankieleon/Flickr)

Cost to make one black printer cartridge: About $4 to $5

Price you pay for an HP cartridge: $14 to $50 (depending on your printer)

Electronics manufacturers like HP are able to sell you inexpensive printers (which they make little profit from), because they know you will pay a premium for ink. In a Computer World story from 2010, HP also argued that it spends a billion dollars each year on ink research and development.



Wine at restaurants and bars

Wine at restaurants and bars play

Wine at restaurants and bars

(Getty Images/Justin Sullivan)

Wholesale price for a bottle of standard table wine: Around $10 to 20

Price you pay at Olive Garden: Around $30 to $48

You pay a lot more for wine bottles when you eat out (at Olive Garden as an example), because of each restaurant's and bar's operational costs. Each state also has its own alcohol laws and taxes that can affect the price of wine.



Beer at restaurants and bars

Beer at restaurants and bars play

Beer at restaurants and bars

(Africa Studio/Shutterstock)

Wholesale price for a bottle of Budweiser: $0.85

Price you pay at an average bar: $4 to $6

Like wine, the price hike of beer at bars and restaurants comes from costs of doing business, like payroll, equipment maintenance, theft, marketing, the state's alcohol tax, and each location's lease.



Bottled water from convenience stores

Bottled water from convenience stores play

Bottled water from convenience stores

(Getty Images/Matt Cardy)

Price to make: $1.50 for 1,000 gallons of purified water

Price you pay for a 16.9-ounce bottle of Aquafina or Dasani: $1 to $3

It takes the profit of about five bottles of water to make the plastic for one bottle of water, a partial reason for the heavy price mark-up. The price hike also comes from Coca-Cola and Pepsi's (the manufacturers of Aquafina and Dasani) marketing and distribution costs.



Soda from convenience stores

Soda from convenience stores play

Soda from convenience stores

(Shutterstock)

Price to make one can of soda: About $0.16

Price you pay for a can of Coke or Pepsi: $0.50 to $1.50

Transportation and marketing costs as well as Coke and Pepsi's brand-name dominance allows them to charge you way more for a can of soda than it costs them to make it.



Prescription eyeglasses

The woman above is not wearing Luxottica glasses. play

The woman above is not wearing Luxottica glasses.

(Flickr/Jim Fischer)

Price to make an average Luxottica pair of frames and lenses: $30

Price you pay: Around $300

The Italian eyewear firm Luxottica (which owns Ray-Ban, Sunglass Hut, and LensCrafters) retains a big chunk of the market, meaning it has little competition and can determine price mark-ups.



Epinephrine auto-injectors

Epinephrine auto-injectors play

Epinephrine auto-injectors

(Thomson Reuters)

Cost to make a two-pack of EpiPens: A few dollars

Price you pay: $600 or more (without health insurance)

EpiPens each hold about $1 worth of Epinephrine, the medicine that combats allergies, though Mylan Pharmaceuticals hiked the price of an EpiPen two-pack from $57 to around $600 in 2016, since the company doesn’t have much competition from generics.

Responding to uproar from from consumers and politicians, however, the company said it would offer more financial assistance to people who need EpiPens.

The device also only lasts between six months and a year before it must be replaced.



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