Firstly, businesses, such as supermarkets or grocery stores, operate on a profit-making basis. They aim to generate a profit by selling items at a markup, which is the difference between the cost of goods and the selling price. In the case of eggs, businesses have to consider several factors, such as the cost of feed, labor expenses, and shipping fees. Additionally, the demand for eggs varies throughout the year, and businesses need to adjust their prices accordingly to maintain profitability.
When businesses purchase eggs in bulk, they can negotiate a lower price per unit with suppliers due to economies of . Suppliers prefer to sell in larger quantities as it minimizes their processing time, transportation costs, and storage expenses. Hence, businesses can pass on this cost advantage to their customers by selling eggs at a lower price for those who buy in bulk.
On the other hand, if you purchase eggs in smaller quantities, businesses have to take into account the cost of packaging and retail labor. Packaging expenses, which include the cartons and labels, increase the cost of each egg. Retail labor, such as stocking shelves, checking expiration dates, and assisting customers, also adds to the overall cost of selling eggs. As a result, businesses have to charge a higher price per unit for eggs sold in smaller quantities to cover their costs and make a profit.
Moreover, businesses use a pricing strategy called price discrimination to maximize profits. Price discrimination is the practice of charging different prices for the same product based on the buyer’s willingness to pay. In the case of eggs, businesses charge a higher price per unit for people who buy in smaller quantities as they are seen as less price-sensitive and willing to pay a premium for convenience.
When you purchase eggs in smaller quantities, you are essentially paying for the convenience of buying only what you need. You avoid the hassle of storing and using a dozen or more eggs before they expire. However, this convenience comes at a higher cost per unit. Instead, if you were to purchase eggs in larger quantities, you would pay less per egg, but would have to deal with storing and using them before they expire.
In conclusion, eggs cost more if they are sold in fewer quantities due to several factors, such as the cost of packaging, retail labor, and the pricing strategy of price discrimination. While purchasing eggs in smaller quantities offers convenience, it comes with a higher price per unit. However, buying eggs in bulk offers cost savings while requiring storage and usage before they expire. Ultimately, the decision of how many eggs to buy and in what quantity depends on individual preferences, needs, and budget.