Replies to post #219897 on Plastic2Oil Inc (PTOI)

[the big guy]

I am flabbergasted that posters say such things without explanation. It is very simplistic to say that once throughput increases all that cost will be spread over lots of units so that cost per unit will magically become a fraction of what it was.

I doubt it. First off, the production process utilizes the concept of machine time, does it not? Each barrel of oil uses so much machine time at some standard cost. Direct Cost. All the costs of P2O go into that.

THe only overhead is the lights, utilities etc. I am not a CMA, but.. I would guess that OH is no more than 5 or 10% of the Total Cost. So, with increased throughput, 10% becomes 5%. Total cost per barrel does not change that much. Margins are slightly better.

The main advantages of mass production is better efficiency and throughput. More output means more margin which means more money. It is a question of repaying invested capital with a decent rate of return.

[the big guy]

Do you think that increased production is going to offset that SG&A or something? SG&A has nothing to do with product cost. Have investors ever questioned or wondered why SG&A is so high? What is it anyway? Ever work out what kind of throughput they would need to offset that SG&A and actually make money? It is astronomical.