Grande25 concluded: “So, basically Paradigm is the largest distributor for the US and possibly the world.” Yes, possibly the universe. But, others exist. MadDog says Paradigm has a North American exclusive (all product must flow thru Paradigm) to feed other distributors – Global Direct and Hagemeyer.
Investors in PDGT will want to know how much profit Paradigm makes. I do not expect Paradigm to tell us. That is WHERE my recent posts have been going –less the sidetracks.
Running the numbers:
The retail price for the combo walk-through FOB Busan is $22,000
Normal pricing practice would project it costs Sam Young $3,000- $4000 for materials and manufacturing. They would sell to large volume distributors for about $9,000.
It costs about $1000 to land (shipping, customs, transport to Paradigm) in US.
Cost to Paradigm about $10,000.
We also know that the highest retail price in US is $24,000.
A retailer (or contractor) would normally get the product for about $17,000
A distributor (like Hagemeyer) would get the product for about $12,000
That would make Paradigm’s profit about $2,000. Some of this profit would go to advertising, company awareness, warehouse, phones, employees, engineering staff, office space, taxes, bookkeeping, executive pay – normal business expenses – the rest to maybe buyback.
Now one may want to shift the numbers around- fine. But remember, each company that handles the product needs to pay expenses, find and support customers, and make a profit too. Each follows norms of profit. The numbers will follow similar percentages for the other Sam Young Unitech products.
I just thought the pie-in-the-sky estimates of selling two to each airport in the world and multiplying, very unrealistic. It was knowing where the product was manufactured, their suggested retail price, and the distribution chain that makes running the numbers possible. Your results may vary –let me know.
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