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Nestle Makes Billions Bottling Water It Pays Nearly Nothing For (bloomberg.com)
Nestle, the world's largest food and beverage company, has been bottling water since 1843 and has grown into the largest seller of bottled water. But a detailed report on Bloomberg uncovers the company's operation in Michigan, revealing that Nestle has come to dominate in the industry in part by going into economically depressed areas with lax water laws. It makes billions selling a product for which it pays close to nothing. Find the Bloomberg Businessweek article here (it might be paywalled, here's an alternative source).
I've heard a lot about how "evil" Nestle is for these practices. But as usual, we're simply dealing with shrewd businesses taking advantage of situations where they can make huge profits because the law of the land doesn't prevent any of it.
IMO, laws can be changed at any time -- so blame the governments for this.
THEY'RE BOTTLING WATER.
Their biggest expense is probably the bottle, and then moving it to somewhere they can sell it.
This isn't news.
Nor is it news that stupid people will pay again for something that already comes out of their bathroom taps or falls from the sky for free all the time.
Dasani (Coke-owned?) were bottling River Thames water and selling it to Londoners. Everyone bought it UNTIL it made the news. They hadn't even noticed or cared up until then.
Bottled water has its place, sure, but paying for a bottle of water if you live in a huge house with hot and cold running water is like buying a can of air.
Shhh, now Everybody who's Anybody is going to have to breathe exclusively canned air, because Jeff Bezos and Elon Musk say so. The truly elite breathe iAir, natchurally.
the largest expense is transportation. my dictionary costs $0.44 to make.
A 2-liter of Coca Coca cost pennies to make.
This has absolutely nothing to do with nerds, technology, internet, or anything even close. It's a food company putting water in bottles. WTF. Not news that matters.
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Why does it have to be so polarized? (EG. Nestle = victim, OR Nestle = evil sociopaths)
I really don't find Nestle as either one. I think they're just taking advantage of the opportunities presented to maximize profits, as they've promised their stockholders all along. If Nestle was really SO evil, they'd be putting highly addictive substances into their water bottles causing you to crave Nestle branded water - or something like that?
Yes, corporations tend to have enough money to buy influence in the political system. That's why I've always felt we need to both pay attention to what's going on and vote in an informed manner, AND reduce government's size and scope. The more power and influence central government has in the first place, the more ability it has to selectively grant businesses specials favors or privileges - despite the will of the people being against it.
I'd love to see political lobbyists outlawed, period. There's no reason someone should get paid just to try to win a politician's favor on an issue when that's the job of the voting public to decide. My elected representatives are supposed to be up there, doing the lobbying for the issues those of us in their district believe should be handled a certain way. Individuals trying to influence them with gifts, dinners, and what-not? They're clearly only there to subvert the process.
I'm not sure if Nestle makes billions, either. At this point it's not worth looking (I'm not about to sit down and tackle this problem right now), especially since Nestle's practices are known-harmful and how much they make off them is irrelevant.
Still, on the subject of how much a company makes: the gross profits are often the subject of discussion when we want to attack a business for price gouging, or for any other reason. A Wendy's franchise, for example, charges twice as much for a hamburger as the cost of the burger flipper, the burger maker, the gas, the grease, and the burger itself; yet the franchise makes an 8% average yearly profit.
Net profits include a lot of organization and things like rent and power, while gross profits skip all that and just focus on what specifically went into the assembly of a product. You also get things like the cost-of-risk, which ends you with e.g. Eli Lily making some 40% profits one year and -21% profits another year, with a five-year average of around 12% (not small, but not egregious). It's a great narrative in the prescription drug debate to call out Lily for making 40% profits [one year], or to point out that those pills cost 11 cents to manufacture; it just happens to be lies told entirely by careful arrangement of true facts.
So does Nestle have billions in revenues, or enormous revenues and billions in profits?
(The problem with seeking the truth--or maybe the best part, depending on your perspective--is you'll routinely say things that make someone on every point on the political spectrum squirm around a lot. Sometimes they throw things at you because they don't like having those thoughts.)
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I'd love to see political lobbyists outlawed, period.
How would that work? First, you'd have to define a political lobbyist. Second, you'd need an enforcement mechanism.
Part of the problem in making political lobbying illegal is that everyone has the right to communicate with their elected officials. Are you going to say that once someone makes a profession of communicating with a politician that they cannot talk to them any more? Okay, define the point at which a person is a professional lobbyist.
For an example let's assume I want clean water for my community. So, I start a little group, Keep My Water Clean. I collect donations, hold fundraisers, and so forth so that I can spend my time traveling through the state and the nation telling those in public office that there needs to be government enforcement on keeping municipal water safe to drink and to fund the creation of municipal water sources for growing communities. You want to ban that?
Let's say there is a ban. How should I be punished if I violate this law and create Keep My Water Clean in spite of the ban? Would you have me jailed? Should I be fined? How do you think that would look in a court of law? Or, the court of public opinion?
I've seen arguments like this before and the typical response would be that non-profit corporations would be exempt. Okay, did you know that the NFL was a non-profit until there was enough public outrage that they changed their legal status? Being a non-profit doesn't mean the entity cannot be very large and make a lot of people a lot of money. Also, suppose a bunch of people got together to make a non-profit that made it no secret of it's affiliation with a large for-profit entity. Let's call this group Pepsico Employees for Clean Water. Every member of the group is a Pepsico employee, and the board is identical to the board of Pepsico. When they hold a meeting they "rent" a conference room at Pepsico headquarters, and Pepsico then "donates" this rent to the non-profit Pepsico Employees for Clean Water, which is then noted on their tax return as a donation to a non-profit.
I say let people say what they want.
I've heard this somewhere before and it comes to mind here, liberals want people to shut up while conservatives want people to keep talking. Go ahead, keep talking. Let the best argument win.
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