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by screcth 637 days ago
When Starbucks sells a cup of coffee who makes more money? Starbucks or the coffee farmer?

This is the same thing. Businesses that are closer to the consumer make more money than their suppliers.

3 comments

This is a completely false equivalence. While the coffee farmers do deserve to get paid more Starbucks is also doing an incredible amount of supply chain management, making sure that the stores work and they are also employing a bunch of more people and they're getting a bunch of things in place for that coffee to be sold.
This isn't always true - dropshipping is being a sharecropper of a manufacturer. Enterprise software that most people will never touch has wildly better margins than consumer software like Spotify.
NVidia makes more money on a GPU sale than the vendor selling it, even though it's farther from the consumer.