Cookie Costs
By Callie Bednarek
As the cookie season wraps up, many of us are noticing that our kitchen cabinets are, once again, freshly stocked with boxes upon boxes of Girl Scout cookies. Beyond the fact that it’s hard to refuse the little girl coming to your door and reciting her well-rehearsed one-liner of “Would you like to buy some Girl Scout cookies?”, we continue to buy each year because of the product’s scarcity. Since we can only buy the product once a year, we are willing to splurge a bit more, and stock up at the one time of year they’re available, which is why some of our wallets may be feeling lighter right now.
However, recent spikes in cookie prices are begging the question: How much are we willing to pay for a box of thin mints? In the past couple of years, Girl Scout cookie prices have been on the rise. We’ve seen an increase from $3.50 to $4.00 in our area, and places like L.A. are seeing jumps up to $5.00 (Moyer). With a recent increase in baker cost from $.85 per box to $1.10, Girl Scouts must estimate a demand schedule to best determine how much they can increase their sale prices without losing too many customers. Below is an approximate distribution of money for each box sold at a price of $4.00.
This distribution is also affected by individual troop decisions. For example, some troops opt to spend some of their profits on rewards for the girls selling the most boxes, which decreases the troop proceeds from around $.80 to $.75 per box (McKnight). The opportunity cost in this case is the troop activities they may not have enough money for anymore. However, some troops argue that the rewards increase competitiveness, and therefore increase the total sales for that troop. If this is the case, then the marginal costs outweigh the marginal benefits, making the decision to reward girls worthwhile.
On the consumer side, we are being forced to make tough decisions regarding our purchases as well. While it’s understandable that prices need to be raised due to increased baking costs, and our natural increase due to inflation, we can’t help but cringe when prices spike. Here is a graph depicting the price of a box of cookies compared to the inflation rate over the last century. To better understand, “A value of 1 indicates the increases are equivalent, and this is indeed the case for the majority of the last century.”
According to this graph, the price of cookies has been increasing steadily along with the rate of inflation. Still, after repeated price increases, many of us will be feeling the income effect, and need to cut back on extra spending even if it means saying no the cute Girl Scout at your door. $5.00 may be the breaking point for many of us. Feel free to check out more about price increases in this video.
Works Cited:
Abc15com. "Get your wallets ready! It's Girl Scout cookie time!" YouTube. YouTube, 23 Jan. 2017.
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"Girl Scout Cookie Price History." On The Feed. N.p., 01 July 2011. Web. 04 Mar. 2017.
McKnight, Amanda. "Now on sale: Girl Scout cookies." SWNewsMedia.com. N.p., 15 Feb. 2015.
Web. 04 Mar. 2017.
Moyer, Liz. "$5 Thin Mints? The Changing Economics of Girl Scout Cookies." The Wall Street
Journal. Dow Jones & Company, 02 Feb. 2015. Web. 04 Mar. 2017.
Roberts-Grey, Gina. "Girl Scout cookies by the numbers: Just where do all those dollars go?"
AOL.com. AOL, 14 July 2016. Web. 04 Mar. 2017.
WochitGeneralNews. "Girl Scout Cookies May Be Getting More Expensive." YouTube. YouTube,
05 Nov. 2015. Web. 04 Mar. 2017.
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