Let me break down the cost of Whey Protein for you

[Pillai]

Okay, so here's the thing. Most good protein brands in India are actually importing whey from Europe, mostly Poland. Why? Because cows in India aren't well-fed or grass-fed like they are over there. Plus, importing works out cheaper. So, there's this brand selling 1kg whey protein for ₹3500 (MRP), direct to customers—no middlemen. I did some math. Imported whey concentrate (80%) costs around $10/kg internationally. Add shipping, you're looking at $12 landed. That's roughly ₹1000. Then customs hits. Duties are around 40-43%. So now we're at ₹1430. Packaging, label, scoop, labor - maybe ₹150 max. Operations, storage, miscellaneous - another ₹100. So total cost before marketing? Around ₹1680. Marketing spend is huge. Gym commissions, influencer promos, "code" discounts. That can easily add ₹500-800 per kg depending on how aggressive they are. So all in, they're probably at ₹2300-2500 cost. And they're selling at ₹3500. That's like ₹1000-1200 profit per kg. Which is roughly 30% margin. I get it, businesses need to make money. But 30% seems kinda steep for basically repacking imported powder. Like if duties are "only" adding ₹430 to the cost, why are we paying almost double the landed price? Shouldn't a fair price be closer to ₹2800-3000? Curious what you guys think. Is this normal or are we getting played?

[Dev]

Yeah, let's not count the salary of the staff, quality checks, cost of damaged products, etc. Easy peasy. Just repackage and ship to customer, right?

[Suraj]

Raw whey concentrate is actually around 2300 per kg.. seems alright as per your maths.

[Rekha]

You haven't accounted for business overheads, permit renewals, and other costs that come with running a business. Now, I'm not aware of how much money businesses in India spend behind overheads, but I'm very sure those numbers will bring down your stated profit margin of 30% to half that, or even lower. This is an assumption made without considering if these companies sell products that are loss leaders.

[Rupali]

You aren't wrong about overhead costs, but the level of costs involved.. Let's take raw material as 1450 as you said. Add 200 for manufacturing, processing and packaging. Add the major cost of shipping and warehousing. That's another 150-200 per kg. Then add rent, salaries and compliance costs, that would easily be 300 per kg. They spend heavily on advertising and what you said is true. Let's take that 500 at the minimum. Add all these up and you get 2500 taking everything at a minimum, same as your cost. Let's add platform commission like amazon, flipkart or wherever you want to sell. That's another 10-20% anywhere in between depending on your volume. You reach 2750 then easily. Add 5% gst and you reach 2900. We have not added many other fees but let's assume these are it. There are many sales and stuff where we get things even at half the rates for stock clearance and many times glitch discounts. If any brand is selling the whey at below 20% margin then it is cheating somewhere or doing no marketing at all. Businesses need to run and capital is mostly taken in the form of loans. After interest and taxes you end up with a measly 10-15% margin at a max that too if there aren't any blunders. I run a Pvt ltd company and all these costs add up. The raw material in any ad heavy spend industry cannot be higher than 30% of the product cost. If it is higher than 30% you will be unable to achieve profits. Google and instagram ads cost a fortune. Each customer acquisition cost is around 300-500 rupees depending on the day. Companies need to be profitable with at least a 25% EBITDA for the founder to get anywhere near 8-10% in the end after all the taxes and stuff. Otherwise, the business isn't worth running.

[Aditya]

Where is the bribery and corruption cost? That's increased multifold and quite celebrated under the current government regime

[Prakash]

I refuse to believe that whey costs that much high because of the trainer cuts they are willing to give. As companies purchase in tons, I believe they will get it even more cheap. One of my friends who works on these protein powders selling told me that at least 100% profit is expected.

[Komal]

10$ per kg. Where did you get this number from?

[Anil]

I love the vibe math. A high margin product like this and all the players in the game are offering same prices? I mean a company could easily run a massive operation, slash profits to 200 and kill everyone else if that's the case.

[Sonia]

I dont think Amul and Nakpro import from Europe, maybe they produce their own

[Saritha]

I just know you haven't done any business and please don't do in future