Egg Cartons and self-publishing - How to Command a Premium in a Commodity Business

Monday, February 04, 2008

Forbes Magazine recently had a profile on Country Hen eggs.Selling eggs is a commodity business, yet Country Hen appears to earn a gross profit margin above 10?Their eggs fetch over $6 per dozen, triple the price of supermarket brands.How do they do that?They feed their cage-free hens nutrient-packed feed that costs $400/ton (double the price of normal chicken feed). Their eggs have 2 times the lutein, 3 times the choline, and 15 times the omega-3 fatty acids as regular eggs.But, here is where they get clever. They can't make medical claims about their eggs on the carton (i.e. it fights heart disease, cancer, memory loss, etc). However, the right to make these claims in books and magazines is protected by the First Amendment.So, the company skirts the issue by publishing a two-page newsletter about its health claims, and tucking a copy in each egg carton.Labels: Business

posted by Praveen Puri at 11:30 AM

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