Any commercial dog food product, whether it is for meals, treats, chews or supplements, is very difficult to determine if it is a quality product because manufacturers are not required to disclose information to help make that decision. They can certainly create packaging and marketing copy to lead consumers into believing what they are purchasing is a quality product. But they do not have to prove what they say.
In this post, we will reveal a few secrets about pricing which may help you get a quick ballpark idea of the quality of the ingredients used.
First, determine the price you pay per pound. This should be fairly easy to do, as you take the net weight listed on a product's packaging and divide into the price you pay.
Before you do the next calculation, we need to educate you on a few other items.
The cost of goods sold (COGS) for any product is the cost of the raw ingredients plus the cost of production and manufacturing plus the cost of the labor plus the packaging and usually also includes some transportation costs to get everything where it needs to be.
A general rule of thumb is that COGS for packaged food products runs 30% of the price you as the consumer would pay to purchase that product.
For organic products, that number is higher, and a rule of thumb is 40%.
So, if you take a pound of dog food that you purchase, and determine that the price per pound is $2, then COGS for a non-organic product would be around $.30.
Keep that number in mind.
Now, dogs should be fed a diet that is approximately 80% meat.
And the very best quality meat that can be purchased at wholesale per pound is around $5 for chicken, and $6 for beef. We know because that is around what we pay for our meats, and we buy the best that can be found.
You might then ask if these prices go down with volume purchasing. The short answer is no.
There is so little supply of true grass fed and free range products raised in sustainable and humane ways in the U.S. that all of it sells out, so ranchers have no incentive to offer cost reductions for volume purchasing.
But remember, the COGS is not just the wholesale cost of the ingredients, but also the manufacturing, labor, packaging and transportation thrown in. So, throw another 30% or so on top of these wholesale prices and you have an idea of the COGS for our food, treat and chew products.
For us, our COGS per pound for our raw dog food products is $9-$10. Compared to our retail price, our COGS runs us around 50%.
To get it down to 30% like most other dog food products and maintain the quality we want, we would have to raise our prices.
But since we sell direct-to-consumer and not through distributors or retailers, we don't have to do that and can keep our prices lower.
So, if your dog food that you buy costs $2 per pound, and the COGS is $.30 per pound, something is terribly wrong because there is no way that this can be a quality product purchased from ranches that treat their animals in humane ways.
Either they are using extremely inferior meat products, or they are using far less meat-based protein sources and loading it with inferior plant-based proteins, or more likely, carbohydrates. Either way, this product is a very poor nutritional source for your dog.
Even if we give them the benefit of the doubt that their COGS might be 50%, which means that COGS would be $1 per pound, something is still terribly wrong because there is no way to purchase high quality meats from humane operations at that price.
So, next time you are buying dog food or dog treats, do some simple math and remember that The Light of Dog's COGS of $9-$10 per pound is for the absolute highest quality meat from humane operations. Anything less than $7 and the company whose product you are purchasing is cutting corners somewhere.