Ingrid Naiman
Member
Posts: 27
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« Reply #1 on: August 06, 2008, 06:17:05 AM » |
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All excellent points.
With transport costs soaring, there are many additional factors to consider, but first a note about taxes. At present, businesses buying for resale do not pay taxes on what they acquire from sources within the state. They also do not have to charge tax on purchases shipping out of state so the tax benefits in Oregon apply mainly to (1) office supplies sourced locally, and (2) sales to Oregon shipping addresses. Therefore, unlike food co-ops that rely on walk-in customers, Ahimsa would have an international membership and the sales taxes would probably not be nearly as important as transportation costs.
For precisely the reasons mentioned, there are individuals who work in Oregon and live in Washington, keeping the traffic on the bridges quite busy, I suspect.
Shipping costs are significant and these are both incoming and outgoing. In a worst case scenario, you have something like black cumin seeds, grown in Egypt or India, imported into the U.S., cold-pressed in one facility, gelcaps filled in another lab, filled bottles sent to vendor, then shipped cross country to seller and then shipped to Yemen or South Africa or Florida. The cost of the oil in the caps is probably less than a dollar but the customer pays $20 or thereabouts to get that bottle delivered where he or she wants it.
The closer to a hub, the more efficient shipping is, but this would generally mean Memphis if using FedEx, not sure where UPS and DHL route shipments, but even now, I could have an order going to British Columbia which as the crow flies is next door, but it goes down to Portland for customs clearance and then back up this way and to the other Vancouver. I don't see a solution unless a time were to come that there would be retail outlets in major population centers.
At the moment, it would be very difficult to analyze sales by region because there is not too much consistency, but clearly, one can say there are probably more shipments to states with large populations than to those with smaller populations, but the explanation is very obvious.
Finally, for exactly the reasons you mentioned, there are not so many shipments to Oregon because many people in Oregon can find what they want locally.
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